All you need to know about mediation in Scandinavian countries

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September 26, 2021

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This article has been written by Debatree Banerjee which deals with mediation in Scandinavian countries. The article has been edited by Khushi Sharma (Trainee Associate, Blog iPleaders)

Table of Contents

Introduction

Mediation is one of the basic dispute resolution systems. It is a voluntary, binding process where an impartial mediator facilitates the parties in dispute to resolve and reach a solution by creating a conducive environment. In Nordic countries, mediation is very broadly defined and does not have different words for mediation and conciliation. There are several definitions and a wide range of views on mediation. Often distinctions are made between theoretical models of mediation and mediation in practice to use it as an analytical tool in empirical studies. The distinction between theoretical models of mediation, practical systems of mediation, and mediation in action also provides an analytical method to view and study the system. All these categories are interactive with one another and have an influence over each other.

There are numerous theoretical models of mediation. In Scandinavian countries, there are many discussions on such models and their taxonomy (Ervasti and Nylund 2014), Vindeløvs “reflexive mediation” (Vindeløv 2012), the creativity of mediation agreements (Adrian and Mykland 2014), mediation in the light of understanding of identity (Asmussen 2018) and meaning of restorative approach in mediation (Rasmussen 2018). For practical systems of mediation, Nordic countries have community mediation for school, neighborhood and community, multicultural mediation, mediation for the workplace and commercial matters, and international peace mediation. There are no institutionalized mediation systems for the field of administrative law yet. The third category is mediation in action. In Nordic countries, there are thousands of mediators working as professionals or as laymen, trained in different theoretical and practical systems. Along with them, the mediators also have different personalities and behaviour which also have some influence over the mediation process and its result.

Theoretical models of mediation

In discussions on theoretical models of mediation in civil cases, the division of the mediation system into facilitative and evaluative models have been analysed since its division. Transformative mediation is considered the third primary model for mediation in civil cases. Among these, the facilitative method of mediation is the most common model used for civil cases in Scandinavian countries. It is considered the purest form of mediation where the mediator helps the disputed parties to find their solution. The old indigenous mediation methods of the countries along with the theoretical methods are generally used for the purpose of dispute resolution and mediation in Nordic states. However, in recent years, the mediation theories of the United States have also greatly influenced the mediation processes in these countries. In Scandinavian states, the research on conflict resolution is strongly linked with socio-legal studies. And in Norway, there are many prominent researchers in this area. In the 1970s, Norwegian professor Wilhelm Aubert developed the conflict theory in Nordic countries, where he distinguished two types of conflict and conflict resolution: competition and dissensus.

Torstein Eckhoff also contributed immensely to the Nordic conflict resolution research. He analysed the role of judges, mediators and administrators in resolution processes; and also discusses the key concepts of mediation such as conflict, dispute, solution, outcome, opinions and interests. Johan Galtung is known as the principal founder of the discipline of peace and conflict studies. Norwegian professor, Nils Christie had a remarkable influence in building the victim-offender mediation (VOM) system in Nordic countries. Unlike other countries where mediators are generally professionals, the mediators in VOM are laymen. He also had a great influence on other mediation systems in the Nordic countries. The idea of Christie was that the people should handle their own problems and conflicts as a community so that they can grow as humans. Currently, the common theoretical approach in VOM in Scandinavian states is restorative justice. For civil cases in Nordic countries, the common model of mediation is the combination of the facilitative method with an interest-based approach. Denmark has generated “reflexive mediation”, which lies in the values of understanding of conscious mediation practice.

Practical mediation systems

In Nordic countries, there are many practical mediation systems, and also there are some differences and also similarities between those practices in different countries.

Communal mediation systems

Since the 1980s, many new mediation systems have been introduced in the Scandinavian states. However, there has not been many private mediation systems out of legal context before the 2000s. At present, Finland like other Nordic countries has a communal mediation system, which has handled several disputes and conflicts in the neighbourhood and community. The background of this system is the community mediation system of the United States. However, the ideas of Christie and the restorative justice model have also built this system. In Finland, around 100-200 cases per year are filed for community mediation. In Norway, the National Mediation Office provides the community mediation service which is based on interests, facilitative mediation and the ideas of Christie.

The School mediation system was introduced in Finland in 2000, with the aim to resolve conflicts directly with the trained pupils and teachers. The theoretical basis for this system is the restorative approach. Cases of bullying and name-calling are also handled in this system. Norway also has a comprehensive school mediation programme built on the ideas of Christie and the Restorative Justice model. Sweden also has some school mediation projects.

Norway, Denmark and Finland have street mediation systems to stop young people from doing wrong, understand their blunders, take responsibilities and correct them.

Mediation in legal context in Scandinavian countries

Victim offender mediation

This system of mediation is popular in Finland, Norway, Denmark, and Sweden. Victim Offender Mediation first experimented in Finland in 1983, and the Act on mediation for criminal and civil cases was enacted in 2006. The focus of this system is mostly on juvenile crime cases and cases of assaults, thefts, and criminal damages. The mediators are provided with brief training before they start meditating. VOM is voluntary and not mandatory mediation. In Finland, there are about 12,000 cases of VOM per year. In 1981, the first victim-offender mediation started in Norway, and the act for mediation was enacted in 1991. Norway has about 9000 cases in VOM per year.

The first experiment of VOM started in the mid-1990s in Denmark. Here, mediation is an option for parties in suitable criminal cases. Unlike Finland, where mediation can replace criminal procedures, in Denmark VOM can only supplement the procedure but can not replace it. In Sweden, the VOM experiment started in 1987. It is mandatory to offer mediation to offenders under the age of 21 years. However, according to Marklund, the Swedish system seems ineffective when compared with both Norway and Finland. The VOM was built as a part of a movement criticizing the criminal justice system. Initially, the builders of VOM were sociologists. The main idea behind VOM was to seek more individualistic solutions for criminal cases. The background behind its development was the thinking of Christie and the reflexive theory of Gunther Teubner.

Judicial settlement and court connected mediation

In Scandinavian countries, the judicial efforts for settlement in civil procedure play an important role. As per Finnish legislation, a judge has to look for prospects of settlement during its preparation to get an amicable resolution of the matter that complies with the substantive law. In Finland, nearly 2500 settlements are certified by the district courts per year. Moreover, not all parties who have reached settlement requests to be certified. These judicial settlements are more like a compromising or conciliation system than a mediation system, as they are strictly settlement-focused.

In Denmark, after the main hearing of the civil case, the judge tells his or her probable judgment and asks the parties to settle among themselves to that approximation. There is no regulation for this system, the judges have developed it over the years. In Denmark and Norway, the term mediation also refers to such judicial settlement efforts.

Norway, Denmark and Finland have introduced a system of court-connected mediation. Norway started an experiment of this system in 1997and has been a permanent system since 2008. Denmark started the experiment in 2003 and has been permanent since 2008. No experiments were held in Finland, but at the beginning of 2006, the act on court-connected mediation was enforced. This procedure is voluntary to the parties and is managed by a judge in situations where parties can find a proper resolution to their conflict. The court decides whether the case is to be referred for mediation or not. And once the court decides to refer parties to mediation, another judge from the same district court is appointed to act as a mediator. In Denmark, the mediators for court-connected mediation are judges and lawyers. Whereas in Norway, primarily judges act as mediators but others are allowed to.

The judges acting as mediators in Nordic courts is quite unique, as most of the countries use a referral system where courts send a case to out off court mediation. The system of court mediation has developed over the years from unofficial experiments in the court system by the judges. The efforts to limit the number of court cases and the costs of the court system also played a role in the foundation of this system.

Lawyer mediation

The system of lawyer mediation in Nordic countries was founded by Finnish Bar Association in 1998 to resolve different kinds of conflicts. This system is voluntary in nature and takes a facilitative approach to mediate conflicts. Here, the parties in conflict appoint an advocate to mediate between them. In 2000, the Norwegian Bar Association adopted the mediation system and, in 2003 Danish Bar and Law Society established an Association of Danish Mediation Advocates. Along with Finland, the culture of lawyers and courts in other Nordic countries is changing to direct “negotiated law”

Other mediation systems

Nordic countries also use other mediation systems to resolve conflicts. Like in workplace mediation, a new phenomenon, where a mediator is appointed to resolve conflicts in a work community. Apart from this, the systems for commercial mediation, environmental mediation and labor mediation are also present. In Finland, Mediation by the Finnish Association of Civil Engineers deals with disputes of building projects, an industry prone to conflicts.

Since the mid-1990s, International Peace Mediation has been a widely used procedure in Scandinavian countries. Norway is a pioneer in international mediation, Sweden and Finland are also active in this system. This system aims to manage international crises and prevent violence. Nordic countries have several internationally acknowledged mediators. To name one such mediators, Nobel laureate Martti Ahtisaari. Research on peace and conflict are also very dynamic in these countries.

Mediation in action

Mediation in action is constructed on the theories and practical systems of mediation. Different theories need different mediation styles and techniques. Such techniques of mediation generally include skills of active listening, questioning, analytical reasoning and brainstorming. For example, in shuttle mediation, the parties stay in different rooms and the mediator is responsible to deliver offers and counter-offers between the parties. This kind is also known as strategic bargaining. In facilitative style, the mediator leads the mediation process and the typical skills needed are active listening, questioning and brainstorming. Whereas, in transformative style, the parties are in control of the process and thus the techniques of empowering, recognising and supporting the self-determination of the parties are typically used. In evaluative mediation, the mediator is responsible for the process but at least in part of the results.

The problem arises as to the mediator’s act and think differently in their day to day work and sometimes interprets what the theory of mediation postulates differently. To substantiate, Victim Offender Mediation does not always follow restorative justice theory and neither does court-connected mediation always uses the facilitative model. In practice, the mediation systems often evolve into mixed systems diverging from what the theories require them to be. These actions are called situational style, eclectic style, hybrid and mixed resolution systems. This confusion arises as mediators have many possibilities to choose from and the legislation of Nordic countries does not provide a detailed framework and regulations on what mediation process is to be followed. Research conducted by various scholars like Elonheim, Adrian and Jacobsson have found a gap between the theoretical basis of the mediation system and the behaviour of mediators. One of the reasons behind the gap is that the behaviour and style of mediators varies a lot.

Thus, the education and training of mediators is an important step so that they can recognise their actions and reflect on them. Apart from it, empirical studies and research on mediation are to be conducted for the development of the system.

Vibeke Vindeløv has stressed that the “mediator must take on the role of the reflective practitioner” who “trusts the parties to bring their knowledge and skills to bear on the problem”. She emphasises that the parties must define how broad the mediation should be.

Conclusion

Since the 2000s, Nordic countries have seen rapid growth in the effective use of mediation systems. Besides, research on dispute resolution methods and mediation have become quite dynamic. However, there still exists a lack of empirical studies and evaluations of the systems. Countries like Finland and Sweden still needs some sufficient training in areas of mediation to be as effective as other Nordic countries. In conclusion, for the development of a mediation system more empirical and theoretical studies are needed along with the development of mediation training.

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Important Supreme Court judgments on maritime piracy

By

Diganth Raj Sehgal

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September 26, 2021

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This article is written by Ridhi Mittal, a student of Symbiosis Law School, Noida. This article talks about the maritime piracy laws and certain important judgments that were passed concerning the said laws by the Supreme Court.

Table of Contents

Introduction

Maritime piracy laws are the laws related to maritime crime. Maritime crime has been a great problem. This worldwide issue ranges from people smuggling to drug trafficking. Piracy refers to all the illegal acts including robbery and other high sea crimes occurring outside the 12 nm limit of territorial waters. Whereas robbery occurring within the 12nm limit is treated as a crime of robbery under the laws of the coastal state. Maritime piracy was defined under Article 101 by the United Nations Convention on the Law of the Sea, 1982. Maritime piracy is an international crime that is to occur on the high seas, i.e., on international waters.

Crimes under maritime piracy

There are various types of crimes that are covered under the ambit of maritime piracy. Some of them are:

Hit and run crime by the pirate ships. It is theft of cash and kind stored in the ship by the sea pirates.
Kidnapping for ransom is done by removing a person from the ships and then demanding extortion money. Kidnapping is also done to take kind or cash for survival by the pirates.
Hijacking a ship for getting ransom or the detention of the target to extort the release money
Stealing ships and cargo by targeting vessels, done often during Ship-Ship operations to remove cargo.

All in all, every maritime piracy act is done to have money by the pirates. They aim to extract the maximum amount of monetary value possible.

This extortion is done by the pirates either by using violence against the vessels and the crew members as a means or by attempting to take over the vessels. Attempts to counter the ship’s defences and ship protection measures by use of ladders, grappling hooks, and weapons deliberately used against the vessel are also witnessed.

Anti Maritime Piracy Bill

The Anti-Maritime Piracy Bill was passed in 2019. This Bill was introduced in Lok Sabha on December 09, 2019. Then it was referred to the standing committee on 23rd December 2019. By February 11, 2021, the standing committee passed it as a report. This Bill gave authorization to the Indian authorities to take action against piracy on the high seas. It is based on the guidelines of the UN Convention on the law of the sea. The laws or the Bill has jurisdiction till 200 nautical miles from India’s coastline. Any action occurring within this diameter comes under the ambit of Indian authorities. As per this Bill, piracy covers inciting and intentionally facilitating such acts of violence, and voluntarily participating in the operation of a pirate ship or aircraft. The punishment for the acts of piracy was also laid down in this Bill. Both life imprisonment and death sentences can be given in case of piracy depending upon the nature and kind of piracy. Participating, organizing, aiding, supporting, attempting to commit, and directing others to participate in an act of piracy will be punishable with up to 14 years of imprisonment, and a fine. Whereas if the act of piracy seeks to cause the death of another, a death sentence must be ordered. The Supreme Court held that the mandatory death sentence for any offence is unconstitutional and violative of Article 14 and Article 21 of the Indian Constitution. Yet, the bill was passed by the parliament including a mandatory death penalty for some offences. The central government, in consultation with the Chief Justice of the concerned High Court, may notify Sessions Courts as the Designated Courts under this Bill. The courts are to try the offence against the person in custody of the Indian navy or coast guard and an Indian citizen, foreign resident in India, or a stateless person. The Court will not have jurisdiction over offences committed on a foreign ship unless an intervention is requested either by the country of origin of the ship or by the ship-owner or any other person on the ship.

Cases of maritime piracy

There have been a lot of cases of maritime piracy that have been tried in the court of law. Many have witnessed incidents of maritime piracy on the high seas. Some of the cases are discussed below.

The Republic Of Italy v. Union Of India & Ors, 2012

The Republic of Italy V. The Union of India, (2012) case took place on September 4, 2012. In this case, Kerala police arrested two Italian marines for an Indian fisherman who was killed on board a fishing vessel 20.5 nautical miles off the Kerala coast. It was held by the supreme court that the state of Kerala had no jurisdiction to investigate the incident. It was ordered by the court for the respondent to set up a session court to try and dispose of the case in respect of the Maritime Zones Act of 1976, the Indian Penal Code, the Code of Criminal Procedure, and UNCLOS. Liberty was given to the appellant, the Republic of Italy, to raise the question of jurisdiction once evidence was adduced on the parties’ behalf. The Indian Ministry of Home Affairs, in respect to the court’s direction, appointed the National Investigation Agency for handling the investigation. It was informed by the respondent to the court that the case was under investigation by the NIA. The appellant argued that it was a violation of the forum by giving the investigation authority to the NIA. Also, the NIA was permitted to invoke the Suppression of Unlawful Acts Against Safety of Maritime Navigation and Fixed Platforms on Continental Shelf Act, 2002, which provided for the death penalty to be applied in any of the scheduled offences. Appellant of the case also said here that because of the exclusion of the act in the original charge-sheet, the investigating authorities were not permitted to take recourse to its provisions in the light of the Court’s directions. This appeal was dismissed by the court as it did not see any reason for calling upon the agency and deciding the conduct of the investigation. The court gave its decision concerning the courts having jurisdiction over Italian marines. The court allowed the respondent to decide on an agency that is neutral to both parties and thereafter to have a dedicated Court to have jurisdiction to conduct the trial. The judges, in this case, were Altamas Kabir CJI, Anil R Dave, and Vikramajit Sen JJ.

United States v. Smith, 1820

This case of US v. Smith, (1820) is regarded as the Supreme Court decision on the subject of piracy. This case dates back to the March of 1820 in Virginia. This case proved to be a great influence on both international as well as domestic piracy laws. It talked about universal jurisdictions and a range of broader themes of the countries in respect of piracy.

Issue of the case

Whether the definition of piracy given by the Act of 1819 was within the power of Congress to define and punish piracies.

Held

Smith, in this case, declared that the definition of piracy was well within the constitutional powers of congress to define piracy by the law of nations as a robbery upon the sea. Smith court examined a lot of treaties in various languages like English, Latin, French, Spanish, and also the case laws. It laid down that various sources depict the same definition of maritime piracy under international laws. The common law recognizes and punishes the offence of piracy as it is considered against the law of nations and the universal of society because a pirate is seen as an enemy of the human race.

The Almezaan

It refers to the action that took place on 23 March 2010. It was an attack by Somali pirates. It was further captured by the Spanish navy. The private security guards, in this case, onboard a UAE-owned cargo ship shot dead a pirate who was in an attempt to onboard the ship off the coast of Somalia. Later on, a Spanish warship took over the control of the boat and pirates and the captured pirates were released by the captain.

In this case, the questions that were raised were:

Do the piracy laws apply to the actions of private agents or security guards?
The clarity of what jurisdiction does the law and authority have, and till where?
The effectiveness of private security guards on the board merchant ships

The United States v. Said, 2010

The United States v. Said, 2010 case talks about pirates approaching the USS Ashland in a small skiff in the Gulf of Aden. The USS Ashland was shot by one of the pirates with the help of a firearm. The crew returned fire, destroying the skiff which led to the killing of one passenger. The pirates neither tried nor did they board the USS Ashland. They were taken into custody by the crew members. The pirates were indicted on multiple counts. They moved for dismissal of the count for violation of 18 U.S.C. § 1651. It was done on the ground that their act was not considered piracy since the boarding of the place did not take place and neither was the control of ASS Ashland taken by the pirates. The motion was granted by the district court. It was held that due process considerations did not allow construction of the piracy statute to include actions other than robbery or forcible depredations upon the sea. This was as per the guidelines and actions of the US v. Smith case and the definition of piracy given then.

Conclusion

Maritime piracy laws evolve around the cases of piracy happening on the high seas. It talks about the types of offences and their punishments by the court. There are limitations to the jurisdictions of the countries due to which their laws apply to a certain area or parameter only. For instance, Indian maritime piracy laws apply to all the piracy acts happening within the boundaries of India and 200 nautical miles from the Indian coastline. Ahead of that, the jurisdiction of Indian courts ends and any case happening beyond that distance won’t be dealt with by the Indian authorities. There are various supreme court judgments on maritime piracy laws. Due to these judgments, the law has kept evolving. All the above-mentioned cases might have different facts and issues, but all of them were set forth on the lines of piratical acts on the part of the defendants. Every country has its jurisdictions and laws to handle the cases of maritime piracy and deliver a fair judgment.

References

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Significance of revised syllabus in legal education

By

Abanti Bose

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September 26, 2021

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This article is written by Neeraj Salodkar. The article has been edited by Khushi Sharma (Trainee Associate, Blog iPleaders).

Table of Contents

Introduction

“Education is the most powerful weapon you can use to change the world”, Nelson Mandela. Education is the tool that can bring transformation not just in people and communities but in an entire nation and humanity’s fate. The education system of a country reflects the true index of the development of a country. The prevalence of a high standard of education fixes the intellectual standards and is a matter of national pride and prestige. In this parlance, the law is the mechanism to achieve an egalitarian social society where no one is deprived of their inherent rights, the importance of legal education cannot be denied. Legal education can be regarded as a primary instrument to bring about social revolution. It is a sine qua non for the very existence of a democratic state. However, the standard of legal education should be determined with the utmost diligence, as it paves the way for bright lawyers, magnificent judges, ambitious jurists and radiant academicians. The National Education Policy (NEP) of 2020 regarding legal education has explicitly stated that legal education in India requires to be competitive globally, quality assessment to be provided, and adoption of best practices to deliver justice within a reasonable time. Prescribing a standard syllabus that consists of an updated syllabus shall lay the first stone for future lawyers and judges. In today’s contemporary world, where rights are challenged every now and then, a dexterous lawyer or judge plays a key role in upholding those rights. It is the need of the hour that the syllabus is altered at regular intervals. However, many law schools in India, either Government or private, are found to have not included several subjects in their current curriculum, which are crucial in the context for lawyers. Pertinently, the curriculum of these law schools is still in the formative process wherein students are being imparted the outmoded syllabus. Various directives have been issued by the Supreme Court of India as well as various reports have been published which envisage the importance and need for a revised syllabus in the curriculum of legal education. In this regard, we shall peruse the reports of the statutory bodies and shall study how its non-adherence will degrade the legal education system.

How outmoded syllabus leads to the degradation of legal education?

In a Public Interest Litigation (PIL) before the Bombay High Court, Nagpur Bench, the petitioner had brought into the notice of the court the lacuna and adversity in the administration of the Nagpur University and their ineffectiveness and lack of prompt action in matters relating to change of outdated syllabus of the BA.LL.B, LL.B, and LL.M which is being taught in law colleges affiliated to the Rashtrasant Tukdoji Maharaj Nagpur University.

That the petitioners and other fellow students of the legal fraternity were aggrieved due to the lack of steps by the Nagpur University and Bar Council of India to update the syllabus in accordance with new amendments in the legislature and to update and amend the syllabus of law on a regular and continuous basis.

It is mentioned in the petition that the Rashtrasant Tukdoji Maharaj Nagpur University has issued impugned direction no. 33 of 2019 (5 years LL.B) and Direction No. 34 of 2019 (3 years LL.B) for a change of syllabus of law. The petitioners pointed out that the new updated syllabus was being implemented for the students who were taking admission to the first year of both the above-mentioned courses from the academic year 2019-2020 and does not apply to the existing students of the course of law for both (3 years as well as 5 years course).

In the petition, the following points were highlighted.

It is to be noted that the entire crux of the change in the syllabus is to teach amended laws as they are on this date to students irrespective of what direction any given university governs them.
The petition states that the scheme to implement the new syllabus is very shoddy, improper, and slapdash and purports to breach the vested rights of the students to study the laws with the latest amendments and not old and obsolete laws which have been removed from the statute book in toto.
The scheme of implementation of the new syllabus could have been rolled out in such a way that all the students, irrespective of which direction governs them, could study the amended laws.

However, when a university lacks the zeal to revise the syllabus appropriately from time to time, it fails to perform its basic function and thereby fails to achieve the purpose for which it was brought into existence.

The petitioner pointed out that the Bar Council of India and Nagpur University have completely deformed their statutory duties and functions. Such non-observance of their duties by the above-mentioned authorities had led to the dilapidation of the quality of legal education which is being imparted to the students, which is a contributory factor in reducing the quality of service of lawyers and judiciary.

Significantly, in the profession of law, dynamic laws are being passed and implemented and, in these circumstances, if the law students are taught the same obsolete laws at the college level, the future will not see young and bright advocates comprehending and applying new laws in practical life.

Reports by statutory bodies

Report by the Supreme Court

A report was formed by the committee constituted by the Hon’ble Supreme court on the subject matter of legal education in India. The report highlights the importance of a revised curriculum time and again. The report states the following: – “The Inspection and Monitoring Committee is to be constituted under the Rules of the BCI. As per the provisions of Rule 20, it shall comprise at least two members of the BCI to conduct an inspection of newly established or existing Universities. According to the provisions of Rule 22, the Inspection and Monitoring Committee shall inspect the University, examine the documents and reports, visit the institution to assess the infrastructure, curriculum design etc. It can be inferred clearly that if the Bar Council had properly done the inspection and monitoring, the problems of the syllabus would have been clearly visible.

The report talks about accreditation and performance rating systems. It states as follows;

“Rules 28 to 32 of the 2008 Rules contain provisions regarding an accreditation and performance rating system for institutions imparting legal education. Out of the many criteria, “system of detail curriculum development and teaching practice session” is one. It explicitly signifies that curriculum is an extremely important factor of accreditation.

The matter of syllabus, training, period of practice etc. were taken up in a Conference of Chief Justices held in December 1993. The report states that “the Bar exam and apprenticeship requirements are extremely pivotal in ensuring high standards of the legal profession. It must be noted that the introduction of such a requirement would (1) prevent law schools from escaping the high standards imposed by the governing legal education body; (2) promote curriculum reform thus increasing the quality of lawyers. Again, the Bar exam has been introduced but the university is still not promoting its curriculum reform. However, it is noted that though the Bar examination has been brought, the standardization and the constant innovation in the standards of the curriculum are still missing, which was the main objective and spirit of introducing the Bar exam.

Reform of legal education in India

“The Reform of Legal Education in India,” a report published by the Bar Council of India, reveals that legal education quality has been degraded. One of the recommendations of this report is that the curriculum must be revised continuously. On the first page of the report, it is stated that Indian legal education is struggling in comparison to its counterparts across the world, which belies the tremendous potential that the Indian legal profession can unleash in the years to come. Further, it also states that legal education cannot be value creation only for “top of the pyramid” law graduates but must have stringent minimum standards so that it is transformational for all law students, irrespective of the law school they choose to graduate from. In the report, a vision statement was published in the year 2010, which identified two reasons for affecting the image of the legal profession in India. The two reasons were inadequate legal education and infrastructure and lack of relevant skills training to meet the ever-changing demands of the modern world. The report has suggested several measures for the improvement of legal education. One of the measures suggested is a revised curriculum.

Design of syllabus as per the report by the BCI

As per the report, there is an urgent and imperative need to evolve the curriculum prescribed to law students. As the law is continuously evolving and organic, the curriculum must also be made as an evolving subject, never stagnant. Just as the law develops itself according to the situation, the curriculum must also be developed accordingly. The syllabus should be equipped, comprehensively and systematically, to cater to the complexities of different as well as changing scenarios and situations. Legal education has to adapt and transform according to the situations. Legal education must aim at preparing legal professionals who will play decisive leadership roles, not only as advocates practising in courts but also as academicians, legislators, judges, policymakers, public officials, civil society activists as well as legal counsel in the private sector, maintaining highest standards of professional ethics and a spirit of public service.

The syllabus of legal education should be as such to prepare professionals equipped to meet the new challenges and dimensions of internationalization, where the nature and organization of law and legal practice are undergoing a paradigm shift.

Words of the then Chief Justice of India A.M. Ahmadi on legal education

While speaking at, “All India Conference of Lawyers on Legal Education and Training” held in New Delhi on 18.11.1994, the then Chief justice of India A. M. Ahmadi had expressed his opinion while referring to a report of the Law Commission Legal Education, “If the standard of legal education in law schools is poor and if enrolment of such ‘half-baked’ untrained graduates is automatic, as is the position today, the burden has to be borne by the judiciary at all levels since they are, to use the expression of Shri Setalved, ‘let loose’ on the judiciary. The unbecoming scenes which are witnessed in courts are largely on account of lack of proper training in law and ethical values and the desire to make a fast buck. The justice delivery system depends on the quality of the Bar and, therefore, the judiciary is vitally interested in the improvement of legal education in the country. I am, therefore, of the opinion that the Bar, the judiciary and the UGC must join hands to raise the standard of legal education in the country.”

State of Maharashtra v. Manubhai Pragaji Vashi and Ors

In the instant matter, it was held by the Supreme Court of India that, ‘The explosion in population, the vast changes brought about by scientific, technological and other developments, and the all-round enlarged field of human activity reflected in modern society, and the consequent increase in litigation in courts and other forums demand that the service of competent persons with expertise in law is required in many stages and at different forums or levels and should be made available. The need for a continuing and well organised legal education, is absolutely essential reckoning the new trends in the world order, to meet the ever-growing challenges. The legal education should be to meet the ever-growing demands of the society and should be thoroughly equipped to cater to the complexities of the different situations’.

M. Santhosh Antony Vareed v. The Registrar

The Apex Court had observed and suggested a few measures in the present case, in the following words, “The legal education has to be made meaningful. William Wordsworth wrote: “Child is the Father of Man”. Likewise, the law student is the future of the Legal profession, Judiciary and Rule of Law. Hence utmost care has to be given to legal education which was hitherto neglected. Legal education requires it to be made on par with the other professional courses. The following suggestions are made regarding quality law education and the Government and Bar Council of India may take note of the suggestions:

h) Standardizing legal education, in keeping pace with globalization and new trends and challenges in the field by updating the syllabus is essential.

Significance of updating the syllabus

With the advent of globalization, the framework of legal education in India requires profound changes to meet the emerging demands of the consumers of legal services. This requires a thorough revamp of the present curricula crafted to stay in sync with the country’s evolving needs. The law students need to be taught and equipped with such tools and techniques of the trade which render them to face the new globalized world order effectively, to which they are exposed. This requires a paradigm shift and transformation of our present curricula taught in law schools. Students passing out from legal institutions need to be taught and trained in newer disciplines that hitherto remained at the periphery or outside the present framework. It requires the cooperative and collaborative effort which involves the academics, the Bar, the universities.

National Education Policy (NEP) of 2020

A framework has been provided by the National Education policy of 2020, which is required to be adopted by all centres of legal education, which has been stated below:

Legal education needs to be competitive globally, adopting best practices.
Legal education must be embraced with new technologies for wider access to and timely delivery of justice.
Legal education must be informed and illuminated with constitutional values of justice; social, economic, and political.
Legal education must direct towards national reconstruction through democracy, the rule of law, and human rights.
The legal education curriculum must reflect socio-cultural contexts emphasizing the history of legal thinking, principles of justice, and jurisprudence practices.
Legal education in State institutions must consider offering bilingual education for future lawyers and judges in English and in the State language where the legal institution is established.

Conclusion

In today’s contemporary world, the quality of legal education should be a benchmark to meet the requisites of the Bar and the needs of trade, commerce, and industry. In addition to this, with the inception of globalization, the standard of legal education should be able to meet its challenges. It is to be noted that Law Schools play a pivotal role in creating and disseminating legal education.

It is to be highlighted that the Bar Council of India (BCI) is a statutory body constituted under Section 4 of the Advocates Act 1961. It is the duty of the Bar Council of India under Section 7(h) of the above-mentioned act to promote legal education and to lay down standards of such education in consultation with the Universities in India imparting such education and the State Bar Councils. Therefore, it is the responsibility of the Bar Council of India to regularly inspect the teaching standards and the syllabus of the Law course and should pass appropriate directions to the Universities to change the outdated syllabus yearly. Also, the report presented by the BCI mentions the need to have an updated curriculum as Indian Legal education is already far behind its peers in terms of imparting quality legal education. Therefore, it can be said that the BCI has failed miserably to perform its duty towards promoting quality legal education, thereby failing the very purpose for which it was brought into existence and given the form of a statutory body.

Thus, the various reports and judgments elucidate in a very comprehensible manner the significance of the revised syllabus in the field of legal education. Also, the Bar Council of India (BCI), University Grant Commission (UGC), Law Schools and Universities must understand their duty to promote quality legal education so that the knowledge of future lawyers and judges is not compromised. Further, the various Law schools and Universities should adopt the NEP 2020 and should act in consonance with the measures and suggestions given by the Committees on Legal Education.

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Is it necessary for disobedience of injunction to be wilful to invoke Order 39 Rule 2A of CPC

By

Diganth Raj Sehgal

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September 26, 2021

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This article is written by Priyanshi Soni, a student of Symbiosis Law School, Noida. This article seeks to analyze if it is important to commit ‘wilful’ disobedience of injunction to invoke Order 39 Rule 2A of CPC with a brief analysis of injunctions.

Table of Contents

Introduction

Civil Procedure Code of 1908 helps in regulating the civil courts’ procedures. One of the provisions mentioned herewith regarding injunction is that of disobedience of such injunction ordered by the Court. Injunctions are the temporary remedies given to the plaintiff with respect to the dispute of his claims, to prevent the defendant from disposing of the rights of the plaintiff, and disobedience of such an injunction can result in punitive actions.

Injunctions and their types

An injunction is a type of judicial and equitable remedy in which a party is granted relief by the court’s order. In this, the court directs the party to do or refrain from doing any specific act. If the party disobeys this order of the court, then heavy penalties are imposed and can even lead to imprisonment. The main objective of this remedy is to protect the property in dispute until the competing claims and rights are resolved before the court. Sections 94, 95, and Order 39 of the Civil Procedure Code specifically discuss injunctions, and also the temporary and perpetual injunctions are defined under Sections 36 to 42 of the Specific Relief Act, 1963. These injunctions help in protecting the property from future damage, violation of law, or infringement of intellectual property rights. An injunction can be filed by the defendant or plaintiff, but not by or against any third person.

Kinds of Injunctions

Injunctions are granted for a particular duration as decided by the court on the basis of the cases. The different kinds of Injunctions can be classified as –

Prohibitory injunction

This type of injunction is passed by the court to prevent the party from doing something which may hamper the legal right of the other. Thus, it is also called a preventive or restrictive injunction.

For example, “A” is a trespasser or wants to trespass into B’s premises so “B” can seek a prohibitory injunction to prevent him from trespassing.

Mandatory injunction

A mandatory injunction is granted by a court ordering the party to do something mandatory. The two things which are necessary for granting mandatory injunctions are – the defendant had an obligation that was not fulfilled earlier and the relief must be enforceable by the court.

Permanent or perpetual injunction

Section 39 of the Specific Relief Act, 1963 deals with the perpetual injunction. By this, the court can order the party to completely refrain from doing something forever. This injunction can only be granted after the final decree is given by the court and is decided based on merit. This is given at the discretion of the court.

Temporary Injunctions

A temporary injunction is granted by the court to temporarily restrict the defendant from causing any injury to the plaintiff’s property or threatening the plaintiff with dispossession or making any third party claim in it. This is a temporary relief issued to ensure that the plaintiff’s rights are not infringed upon. This injunction can be granted by the court before the disposal of the suit at any stage of the trial. Temporary Injunctions are governed by the Civil Procedure Code of 1908. Here are the provisions under CPC which govern this –

Section 94 – The purpose of this section is to keep the goal of justice from being defeated. Section 94(c) discusses giving temporary injunctions and, if the party is disobedient, can commit the person to civil prison or order that his property is attached and sold.

Section 95 – If the claim of the plaintiff is defeated, then the court can grant compensation to the defendant if he claims so.

Order XXXIX – Rule 1 of Order XXXIX mentions the ground on which a temporary injunction may be granted by the court. These are as follows –

Any property in dispute is in danger of being damaged, squandered, alienated, or wrongfully sold in execution of a decree by any party to the suit.
When the defendant threatens or wants to remove his property in order to cheat creditors.
The defendant threatens to evict the plaintiff or otherwise harm the plaintiff in relation to any property in dispute in the suit.

Rule 2 stipulates that an interim injunction might be imposed to prevent the defendant from breaching the contract if any harm to the plaintiff is imminent. The plaintiff bears the burden of proving that the injunction should be enforced.

Order 39 Rule 2A of CPC

Order XXXIX CPC deals with the grant of temporary injunctions. Rule 1 deals with the cases in which temporary injunctions can be granted and Rule 2 is about granting an injunction to restrain repetition or continuance of breach. Rule 2A of the order the consequence of disobedience or breach of injunction as follows:

In the case where there is disobedience shown in any injunction granted or other order ordered under Rule 1 or 2 or breach of any of the terms on which the injunction was granted or order made, the court can order that property of such a person can be attached and he can be sent to civil prison for a period not exceeding three months unless in the meantime the Court directs his release.
Also, no attachment made under this rule shall remain in force beyond 1 year and if the breach continues, the court can allow that The attached property may be sold, and the court may award such compensation as it sees suitable to the injured party out of the revenues, and the rest, if any, shall be paid to the person entitled thereto.

Should disobedience of injunction be wilful to invoke Order 39A Rule 2A

In a recent case of Amazon v Future Retail (2021), a Supreme Court bench comprising Justices RF Nariman and BR Gavai made an important observation regarding if “mere” disobedience will suffice or it has to be ‘wilful disobedience’ of injunction to invoke Order 39A Rule 2A. This provision was interpreted in the Amazon by a single bench in an application filed by Amazon to enforce the award passed by the Emergency Arbitrator, which had issued a show-cause notice under Order XXXIX, Rule 2-A of the Code of Civil Procedure.

Background of the Amazon-Future Retail case

On March 18, a single bench of Justice JR Midha of the Delhi High Court granted Amazon’s petition for enforcement of the interim order dated October 25, 2020, passed by the Emergency Arbitrator under Section 17(2) of the Arbitration and Conciliation Act, 1996 read with Order XXXIX Rule 2A and Section 151 of the Code of Civil Procedure. The single bench determined that the ‘Emergency Award’ is enforceable under Indian law as an order for interim relief issued under Section 17(1) of the Arbitration Act. The single bench also used the term “group of companies” to hold that FRL and the Biyanis are subject to the Singapore award.

Significantly, as per the latest judgment, the Supreme Court has held, after appeal, that the emergency Award passed by the Singapore arbitrator stalling the FRL-Reliance deal is enforceable in Indian law, thus favouring Amazon.

Observations made by the Court

Remembering an old judgement on Food Corporation of India v. Sukh Deo Prasad (2009) the Court observed that the power of the court which Order 39A gives is punitive and so the court can punish in case of civil contempt under the Contempt of Courts Act, 1971.

In U.C. Surendranath, the bench of Justices R. Banumathi and AS Bopanna had observed thus: “For finding a person guilty of willful disobedience of the order under XXXIX Rule 2A C.P.C. there has to be not mere “disobedience” but it should be a “willful disobedience”. The allegation of willful disobedience being in the nature of criminal liability, the same has to be proved to the satisfaction of the court that the disobedience was not mere “disobedience” but a “willful disobedience” and that the allegation of willful disobedience being in the nature of criminal liability the same has to be proved to the satisfaction of the court that the disobedience was not mere ‘disobedience’ but ‘willful disobedience.

Now recently, doubting this decision, the Court says that it is doubtful regarding if “willful” disobedience is necessary to analyze the case or not. So the court has asked for a review of this by a larger bench. Suffice it to say that there is a vast difference between the enforcement of orders passed under Order XXXIX, Rules 1 and 2, and orders made in contempt of court.

Conclusion

Rule 2A, which was added by the Amendment Act of 1976, deals with severe consequences for disobeying or breaching a civil court order of injunction. The power granted by this clause is similar to the civil contempt jurisdiction. There has been confusion regarding disobedience of the injunction whether it should be willful or not, this question was answered earlier but now again, the doubt is raised by the Court in this matter.

References

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How to send a legal notice to a tenant to vacate the premises

By

Abanti Bose

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September 26, 2021

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featured_botched-eviction (1) — Image Source: https://rb.gy/dwf8w5

This article has been written by Tapasya Bhatia a second-year law student from PSIT, College of Law. The article has been edited by Khushi Sharma (Trainee Associate, Blog iPleaders).

Table of Contents

Introduction

A tenant eviction notice is basically a legal document in the form of a notice indicating stipulated time in which the tenant should vacate the leased premise it is given by the landlord to the tenant.

What is an eviction?

The period eviction refers back to the civil system via means of which a landlord can also additionally legally cast off a tenant from their condo assets. Eviction can also additionally arise whilst the tenant stops paying lease, whilst the phrases of the condo settlement are breached, or indifferent conditions accredited via way of means of law.

An eviction is the courtroom docket-ordered elimination of a tenant from the assets wherein they reside. A landlord can also additionally determine to evict a tenant for non-charge of lease, damages, unlawful activity, violating the phrases of the hire, or if the owner desires to take ownership of the assets.

What is an eviction notice?

An eviction notice is a letter dispatched with the aid of a landlord to a tenant to tell them that they ought to restore sure trouble or vacate the assets inside a sure variety of days.

In a few instances, the owner can also additionally accept as true that the hassle isn’t fixable and ship what’s called an incurable eviction be aware. In this case, the tenant has no desire however to vacate the assets inside a sure variety of days.

It has been held in the case of Achintya Kumar Saha v. Nanee Printers (2004, SCC 368) that; herein view of the rent control laws and the concept of statutory tenancy evolved in the respect of urban building it is now generally necessary to determine tenancy by a notice to quit before claiming ejectment on grounds admissible under such laws.

If the tenant is uncooperative and does not want to settle the dispute peacefully and does not even agree to vacate the land, the landlord can issue an eviction notice. Not only a tenancy of temporary term but also of fixed-term can be challenged and determined by the eviction notice.

When to send an eviction notice?

Rent not paid: A landlord can evict a person for non-payment or delay of a month or two depending on how long the tenant has been living in the property.
Subletting: A landlord can evict a person when he rented his property for one person and the tenant added two more tenants and started taking rent would be a serious reason for filing an eviction notice.
Damaging the property: If the tenant has seriously damaged the property and is unwilling to pay for the damages, the landlord may evict them.
Self–use: If the owner needs the premises for his purpose or the purpose of his family members.
Commercial use: If the owner needs the premises to run the business using their own property he may send an eviction notice.

Procedure to evict the tenant

In the judgment of the case Narayan v. Kunbhan Mannadiar it was held that the landlord cannot issue the notice of eviction just because he wants to but only if has a valid and legal reason. The reason to ask the tenant to get out from the place must be a justifiable reason and must not be derived from a mere demand for more possessions.

For sending an eviction notice to the tenant there is some essential step followed during the course of sending notice:

Step 1

Firstly, the owner must send an eviction notice before 30 days of filing the suit. A checklist of documents consisting of a serious, valid, legitimate reason for issuing such a notice. The owner will be required to send scanned copies of documents for verification by the lawyer. The notice must be framed in a way that reflects the clear issue and stipulated time that the tenant is legally bound to do so.

Step 2

Secondly, on the refusal of the tenant, the petition will be filed, drafted, and shared after reviewing the same and approved within 7 days. The owner is required to print the draft and sign and send it via courier/post.

It has been held in the case of Munisami Naidu v. C. Ranganathan, AIR 1991 SC 492 the Board was entitled to institute proceedings against the tenant as the notice period had expired. Similar was the case in Vasant Kumar Radhakishan Vora v. The Board of Trustees of the Port of Bombay, AIR 1991 SC 14 where the plaintiff sued the defendant for not conforming to the eviction notice.

Step 3

Thirdly, the case will be filed before the civil court within 3 days as the signed document is being received. Thereafter the lawyer will present the argument before the court and after all hearing and argument evidence presented. Court gives the judgment in favour of any party and the final decision has to be followed by the parties.

Procedure to evict a tenant under the Uniform Residential Landlord-Tenant Act (URLTA), 1872

The landlord can evict a tenant under the Uniform Residential Landlord-Tenant Act (URLTA),1872 through the way of eviction notice as prescribed under the Act. Under Section 12 of the Uniform Residential Landlord-Tenant Act (URLTA),1872 it talks about eviction notice i.e a formal written letter sent by the landlord to the tenant to evict a person by communicating the termination of the Tenancy Agreement.

It was held in the case of Achintya Kumar Saha v. Nanvee Printers it was held that according to the Indian Rental Laws, 1948 the rights of the landlord to evict their tenants are subject to providing the justified reasons for such actions.

What information does the eviction notice include?

An eviction letter must consist of all the specified information of the tenancy agreement, the name of both the parties, the purpose of the notice must be specified and how long the tenant may have to address the issue before any further legal measures are taken.

There are the following details that are covered under the notice:

Addresses of the rental property,
Address of the owner,
The tenant name (the one who pays the lease or everyone who has occupied),
Status of the hire,
Date of hire,
The reason that the notice is being served (the cause for the eviction will country the form of being aware this is being produced),
Date when the landlord signs the notice,
Proof of service.

Conclusion

Renting an apartment, house or property is a common practice in our society and is beneficial simultaneously for both the owner and the tenant. But there are also cases where the landlord gets tired of the tenant as he does not pay the rent or sorts to some unlawful or hazardous activities at the premises and hence the owner asks the tenant to leave the premises and restore his property back.

Dispute between landlord and tenant can be settled peacefully but in some cases, if the tenant refuses to do so the landlord has to file an eviction notice for the further process.

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All about doctrinal and non-doctrinal research

By

Rachit Garg

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September 25, 2021

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web-research-services-1024x649 — Image source: https://cutt.ly/ilUQZq9

This article has been written by Neha Dahiya. The article has been edited by Khushi Sharma (Trainee Associate, Blog iPleaders) and Vanshika Kapoor (Senior Managing Editor, Blog iPleaders).

Table of Contents

Introduction

The research basically means searching for something again and again until we reach an unequivocal conclusion. It is a systematic investigation that entails the collection of data, critical information, arranging it all and then analyzing it to deduce something meaningful. The word “research” is derived from the French word “recherché” which means to investigate thoroughly. So whenever research is being conducted, be it in any field, it involves going into the depth of the topic and making sense of it.

Legal research in particular dives deeper into the legal ocean. It is all about searching and researching laws, their origin, their application and everything else that can have the slightest nexus with the legal sphere. We try to search and analyze the effect of all the legal and non-legal variables on the process of legal decision-making. Black’s law dictionary defines legal research as “the finding and assembling of authorities that bear on a question of law”.(How to do legal research in 3 steps n.d.) Legal research is a constant companion of people involved in the legal world, be it the attorneys, judges, jurists, law researchers, law students and academicians. To possess the legal prowess and accumulate knowledge to effectively contribute in this arena, research is important for all of them.

Now, to conduct research different pathways can be adopted. These pathways are known as “research methodologies”. Methodology in research is defined as the systematic method to resolve a research problem through data gathering using various techniques, providing an interpretation of data gathered and drawing conclusions about the research data.(Bouchrika 2021) The two words method and methodology should not be used interchangeably. Method signifies the process of collecting the required information and the technique that is employed to achieve this objective.

Whereas, on the other hand, methodology implies not only the procedures involved to collect data but also how to analyze and interpret it. The methodology is a comprehensive term and is wider than the method. It is a compass that determines the direction of the research.

Two prominent methodologies that are employed in legal research are doctrinal and non-doctrinal. The former one is more inclined towards theoretical aspects and academics, hence also known as “library” or “arm-chair” research. While the latter is more practical and takes an interdisciplinary approach to observation. Hence it is also called “empirical” research.

Doctrinal research

Meaning and definition

Dr S.R. Myneni has defined, “A doctrinal research means a research that has been carried out on a legal proposition or propositions by way of analyzing the existing statutory provisions and cases by applying the reasoning power.” (Tiwary 2020)

Doctrinal research has the root word “doctrine” which means a principle or a basic governing tenet. That means, the legal doctrine would include legal principles and tenets that would govern the legal world. Therefore, it implies that doctrinal legal research would involve digging deeper into the legal principles and concepts from various sources like cases, precedents, statutes and others; to analyze them and reach valid conclusions.

The focal point of doctrinal research is answering the question “What is law?”. It is library-based research, i.e. we try to find out definite answers to legal questions through a thorough investigation from the law books, statutes, legislation, commentaries and other legal documents. All of these sources fall under the category of “Secondary Sources”. As stated earlier, it is theoretical research that does not involve any kind of experimentation or fieldwork.

Here, we are basically checking the validity of existing laws in light of a changing society. It begins with one or more legal propositions taken as a starting point and the entire research is directed in finding the validity of that hypothesis. It simply means reviewing and studying different legal documents and other sources and then deducing a complete answer to the question asked at the beginning by the means of rational interpretation and logical reasoning. Most often, the starting point in any research is doctrinal, i.e. library-based and then we move forward to other methodologies once our base is set by doctrinal research. This is the reason that doctrinal research is very famous among students and academicians.

History

The roots of doctrinal research can be traced to the positivist or the analytical school of law which was objective and value-free. It is more epistemologically oriented and does not concern itself with people or society. Though the law itself is normative, doctrinal research does not study it in a normative sense. It does not take into consideration the human aspects of law and how it affects people in society. In this type of research, we just concern ourselves with existing laws in the present state as they are. Its emergence can be traced parallel to the rise of common law in the nineteenth and twentieth century. Common law has been developed by the efforts of jurists and the Court’s decisions. The doctrine of precedents also developed around the same time. All of these developments are linked to doctrinal research as without it the other parallel developments would have been incomplete. It is when judges and attorneys investigated laws from various above-mentioned sources, that they could set the stage for the progress of common law.

And we all know, common law is the basis of legal development in several other countries. At a similar time, the law had entered the academic field in Europe and doctrinal research picked up pace as it became a popular tool of academic legal research. (Tiwary 2020) This is the reason why doctrinal research is also known as traditional research.

Purpose

One of the main purposes of conducting doctrinal research is solving the legal problems of bringing laws. For example, if the government decides to bring umbrella legislation for all the crimes committed against women, it may initiate doctrinal research by some jurists and experts in the field.

They may have to go through all the existing laws in this field, previous case laws, precedents, international trends, legal commentaries, articles by scholars, dictionaries, encyclopedias, journals, treatises, textbooks and other sources of legal information. Going through this sea of information, they would be able to answer all the questions related to this legislation and will be successful in bringing out comprehensive legislation.

It can be utilized for several other purposes as well like to help lawmakers develop meaningful and effective laws, develop fresh legal doctrines, aid courts in reaching effective and legally accurate judgments, help lawyers to interpret statutes and prepare their suits, help students in academia to set a base and many others.

Methodology

The methodology in doctrinal research starts with setting a proposition as the starting point. A legal provision in question or an existing law could be chosen for the purpose. The next step could be to analyze the purpose behind bringing that particular law. For example, for a provision of the constitution, Constituent Assembly Debates could give great insight.

The law then can be studied in greater detail. A course of action must be selected. Alternative courses can be explored. Different models need to be studied and finally, the consequences and approximated effects have to be weighed in order to accurately make predictions about the proposition set at the beginning. In all these stages, secondary sources talked about in the above paragraphs are utilized.

But one must be very careful in the selection of these sources. Searching for reliable and accurate sources demands time and effort. Useful information must be separated from the chaff as the presence of unreliable information could lead to misleading and inaccurately skewed results. The efficiency of this method also depends on the question that is asked in the beginning. Asking the right question is the first step towards concrete research. Setting the right proposition and then relying on the right sources is the key to successful doctrinal research.

Advantages and disadvantages

To begin with the advantages, doctrinal research forms the base of legal research in the academic field of law. Law students at the graduate and post-graduate levels usually venture into the world of legal research with the help of doctrinal methodology. This is the starting point for them where they can analyze sources available in the library and logically deduce their findings. The students are not well equipped at this particular stage to get involved with empirical research and to consider the law in the context of society. It is easier for them to study law “as it is” from secondary sources and it acts as a good starting point.

In addition, it gives the judges and lawyers the flexibility to approach law from different aspects and make its interpretation. It may not be wrong to say that the amorphous mass of the present-day statutory provisions takes concrete shape and form in the great laboratories of the law courts. (Jain 1982) Judges have over time developed law from their deep knowledge and investigation into the field. Law of torts is one great example as it is a “judge-made law”. Therefore, doctrinal research being the traditional methodology has helped in the development of legal research by giving it a base. It has been a close companion of law academicians, students, judges, advocates and jurists.

However, doctrinal research has its own shortcomings as well. Availability and choice of right and reliable sources is the bottleneck in doctrinal research. Logical deduction is also an uphill task. Furthermore, it is highly theoretical and restricted. Without the right direction, it may become highly objective and too mechanical. Moreover, it can be further highlighted that it studies law individually and does not consider it in the backdrop of society which is the playground of law. Without studying its normative and practical aspects, it’s like studying law in darkness and seems incomplete.

Non-doctrinal research

Meaning and definition

Non-doctrinal research, also known as social-legal research, is research that employs methods taken from other disciplines to generate empirical data that answers research questions. (Salim Ibrahim Ali 2017)

Non-doctrinal research takes a multi-disciplinary approach towards legal research. It employs methods and information available from other disciplines to make a comprehensive approach towards law. It employs primary sources of legal information to reach a conclusion. Primary sources may include observations, experiments, questionnaires, surveys, etc. With the help of these sources, we analyze the practical aspects of law like the effect of its implementation in non-legal fields and society as a whole. Basically, we take a legal variable which could be a law along with a non-legal variable like economic, social, political, etc. and study their relationship by data collected, which could be qualitative or quantitative. Its area of focus is how the law works in the real world.

History

After World War II, there was a growing emphasis on empiricism. Hence, the realist school of thought developed. The realist school of thought brings to the forefront, the concern that laws are made for the benefit and regulation of society. Laws are there to fulfil society’s needs. Therefore, they cannot be studied in isolation and must be developed as per society’s requirements. Society is dynamic and so should be the law. Law should be suited to the needs of the real world.

Non-doctrinal research developed out of the growing need of bringing the law into the realm of realism. It was felt that legal research should deal more with its practical application and how it functions and affects the life of people in real-world; and less with the theoretical aspect of studying written law.

Moreover, we have also seen that towards the same time, there was a growing emphasis on the welfare state model. It was believed that the state was meant to serve the society and all the laws that it brings must cater to this need of welfare of the citizens. In this background, there was a huge lift received by non-doctrinal research that helped in this direction. Governments have also encouraged this field of research to bring out legislation that truly help people and also to judge how well they have performed.

Purpose and methodology

The purpose of non-doctrinal research is to check the utility of a law that has been brought or how it impacts the non-legal aspects of society. Also, non-legal factors affect the implementation of the law. Sometimes, a very comprehensive law is brought but sometimes the environment is such that its effectiveness is shielded by those circumstances. For example, a law brought to open the market for foreign players to liberalize the economy may be considered very destructive at a time like that of a pandemic when the domestic market is hard hit by lockdown and would be considered devastating.

While in normal circumstances the same law might have been proved very useful for the economy. Now research may be sponsored by the government to check whether circumstances are conducive to bringing such a law. The research may include collecting data about the condition of the domestic market and how it will affect it if the law becomes a reality. Research after implementing the law can also be conducted to check its consequences and effects that it had actually brought. For this purpose, the help of other behavioural sciences can be taken. It relies on observation more than theory because under different circumstances theory remains the same but its practical application changes and it is important to keep a track of these changes to keep the law updated and effective.

The methodology adopted is that of empirical research, i.e. different modes of experimentation and observation like collecting data by means of case studies, questionnaires, surveys, etc. These are the primary sources that give us first-hand information that can be then analyzed. This data collected can then be arranged in pie charts, bar graphs or other forms to reach a conclusion.

Advantages and disadvantages

The advantages of non-doctrinal research are many but the prime one remains its utility in practical purposes. It helps in gauging the practical effectiveness of laws in various non-legal fields. It is an effective tool to judge the performance of law in society. Legal issues are better analyzed when studied in a comprehensive manner by taking into consideration all the factors that might affect it. Moreover, when the data is quantified, it becomes rationally more appealing and authentic. Also, since it relies on primary sources of information, it is more reliable.

Developing welfare policies for people has become the major function of the state. But it is not possible without any data that reveals the actual circumstances of society. Non-doctrinal research tells us what actually the society needs, where the laws are lacking and what are the responses of people on whom those laws are imposed. All of this information which can be obtained by non-doctrinal research makes policymaking a better and easier task.

Moreover, there is a gap between the law in books and law in action. Law transforms to a certain extent when it comes to implementation. Many variables exert their influence to cause this transformation. Knowledge of these factors that can be obtained by non-doctrinal research can help us in understanding this gap and in working towards eliminating it.

However, it also has its fair share of pitfalls. Non-doctrinal research is very time-consuming. It requires a lot of time and resources. Availability of funds poses another challenge. The collection of data can be a daunting task. And more than that, collecting the right pool of information from society can be full of errors. People have different understanding and amounts of information. They have their own biases. That means the information collected, like from questionnaires and surveys can be skewed and misleading. Also, collecting primary data about some sensitive issues can be a dangerous task for the researcher. The research may also be blurred by the researcher’s personal prejudices and biases.

Comparison between doctrinal and non-doctrinal research

Doctrinal research is theoretical research, while on the other hand, non-doctrinal research is more practical.
Doctrinal research has its roots in the analytical or positivist school of thought. But non-doctrinal research comes from the realist school of thought.
Doctrinal research is based on secondary sources of information, like articles, commentaries, textbooks, etc. But non-doctrinal research is based on primary sources like surveys and case studies.
Non-doctrinal research includes fieldwork but doctrinal research is library-based arm-chair research that does not involve going to the field.
Doctrinal research is more concerned with the question “What is law” and studying law exclusively. But non-doctrinal research studies law in connection with society and various non-legal aspects that affect the law. It is socio-legal research.
The scope of doctrinal research is narrower concerning the law in isolation. But non-doctrinal research has a wider scope and studies law in comprehensive terms.

Conclusion

Both forms of legal research have their own share of advantages and disadvantages. This means that none of them is infallible or complete in itself. One is rooted in theory while the other in practicality and as theory cannot be sacrificed for practicality alone and vice versa, both of them have their separate roles in the field of legal research.

Doctrinal research has helped in developing a basic awareness of legal issues among the people. It has immensely helped judges and attorneys in legal suits to develop valid arguments and reach an effective judgment. The development of tort law is a prime example. Doctrinal research by focusing on “law as it is” has helped in percolating a greater awareness about legal issues among the masses. It has also helped in pointing out the loopholes in existing laws and statutes. As another side of the same coin, non-doctrinal research focuses on law in action in its playing field i.e. the society. It could be of great help for analyzing the effects of laws on people and how to bring out legal reforms. It helps the law to catch up with this ever-changing society. Judicial activism is a great product of non-doctrinal research.

Therefore, both these forms are complementary to each other. Doctrinal research forms the foundation, on which the structure of non-doctrinal research can be constructed. They need to and must support each other. They can be used alternatively or in a hybrid form for effective and meaningful legal research.

References

Bouchrika, Imed. How to Write Research Methodology: Overview, Tips, and Techniques. May 2, 2021. https://www.guide2research.com/research/how-to-write-research-methodology (accessed July 4, 2021).
How to do legal research in 3 steps. https://legal.thomsonreuters.com/en/insights/articles/basics-of-legal-research-steps-to-follow (accessed July 4, 2021).
Jain, S.N. “Doctrinal and Non-Doctrinal Research .” Journal of the Indian Law Institute, 1982: 341-361.
Salim Ibrahim Ali, Dr. Zuryati Muhammad Yusoff, Dr. Zainil Amin Ayub. “Legal Research of Doctrinal and Non-Doctrinal.” International Journal of Trend in Research and Development, 2017: 493-495.
Tiwary, Shriram. “Doctrinal and Non-Doctrinal.” Academia. 2020. https://www.academia.edu/40656281/Doctrinal_and_Non_Doctrinal_Methods_of_Legal_Research (accessed July 4, 2021).

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A guide to choose between trade secrets and patents

By

Diva Rai

-

September 25, 2021

0

pci0420-Howard-184862380-900 — Image source - https://bit.ly/3o8jGo6

This article is written by Alvira Sadik Shaikh, pursuing a Diploma in Advanced Contract Drafting, Negotiation and Dispute Resolution from LawSikho. The article has been edited by Khushi Sharma (Trainee Associate, Blog iPleaders) and Vanshika Kapoor (Senior Managing Editor, Blog iPleaders).

Table of Contents

Introduction

In today’s competitive world, there is an ever-increasing need to create, innovate and produce unique ideas in order to gain a competitive advantage over others. Businesses all around the world are striving to create new products, inventions and technology to build an identity in the market and attract customers. Along with the innovation of new ideas, comes the need of protecting them from competitors and the public domain. For example, if a cosmetics manufacturing company creates its own new and unique beauty product and launches it in the market, this product will create a curiosity among the customers and even attract them toward buying it. Subsequently, the company’s market value will increase along with the rise in its customer database and the need for protecting this information as well as the new formula of their beauty product. All such innovations, ideas, information come under one umbrella i.e. Intellectual property. Such intellectual property can be protected through copyrights, trade secrets, patents, etc. But how to understand which law can be used to protect our intellectual property?

This article will help you understand the difference between trade secrets and patents and will act as a guide to choose between the two to protect your intellectual property.

What are trade secrets?

New inventions come with new designs, patterns, information, formula, and methods that are unique to one’s own product or innovations. For example, when you start your own restaurant and sell a dish which has its own unique recipe, name and your restaurant is famous for this dish which helps you attract a large number of customers, thereby increasing your market value and giving you a competitive advantage over others. This unique recipe is your trade secret which, if revealed to your competitors or the public, will lead to a huge loss for your business. So, wouldn’t you want to protect your secret information and not let it out in the public domain?

However, such information should not be already available in the public domain, have some economic value and be confidential to become a trade secret. Many times businesses or individuals have to share their trade secrets with their employees or the parties with whom they are carrying out the business. These secrets can be easily let out or used in an unauthorized manner by anyone. In order to protect such confidential information, you can enter into a trade secret agreement with the party or your employees. This agreement binds the party to protect your confidential information and ensures that your trade secrets are protected.

What are patents?

A patent gives the exclusive or sole right to the owner of an invention. Such inventions must be new, unique, technical and provide a solution. For example, if you invent a machine that is completely new, provides a solution to a problem, then this machine can be patented and you will become the sole owner of it and have an exclusive right over it.

A patent is an intellectual property right that allows us to prevent others from using our unique inventions for a period of up to twenty years. After this period, your invention becomes free to be used by anyone, if you do not renew it. Moreover, you can sell your patent rights to someone to use it for commercial purposes.

Difference between trade secret and patent

Both patents and trade secrets are used to protect inventions, ideas and information that are unique and provide us with an economic value. However, there are some differences between patents and trade secrets which can help us understand which one will be suitable to protect our inventions.

	PATENT	TRADE SECRET
Protection	Protects new, useful inventions.	Protects confidential information kept secret and not disclosed in the public domain.
Disclosure	The inventions are disclosed in the public domain.	The information is kept confidential.
Validity	Up to twenty years.	The information is kept confidential as long as it is a secret and known by the general public or revealed by the owner himself.
Duration	The duration to grant a patent is approximately two to three years.	There is no such duration for trade secrets as it depends upon the internal procedure.
Prevention	A patent prevents others from using the invention for commercial purposes.	A trade secret prevents the information from being used in an unauthorized manner.

What is right for you: patent or trade secret?

Often there is confusion regarding what to choose in order to protect your intellectual property. So, here are criteria that can help you determine which one to choose based on your needs and usage.

Patentability

The most essential part in the process of choosing the method of protection of your information is to identify whether it is patentable or not. If the information at hand is not patentable, then it is always better to opt for trade secrets and use your resources for it. Moreover, any sensitive information which is your company’s secret and brings you an economic value, cannot be revealed in the public domain and hence it will be better to protect it with a trade secret agreement and maintain its confidentiality.

Duration of protection

The registration of a patent is a costly and lengthy process. A patent lasts for twenty years and it has to be renewed after this period expires. If it is not renewed, the competitor can use the information and produce a similar product which can lead to a great loss to the original producer or inventor of the information or product.

As opposed to this, the process of protecting a trade secret is usually easy and short. The duration can be determined by us and we can decide for how long our trade secrets remain protected from being used by others. We can enter into confidentiality agreements with the people with whom we are sharing our confidential information and include all the terms and conditions and the duration of the agreement. This also helps us in making the party bound to protect our information and stating the consequences that the party might have to face if he/she reveals or uses the information in an unauthorised manner.

Disclosure

Trade secrets are usually protected and kept a secret thereby preventing the competitors from getting to know about what is going on in the business or whatstrategy they are using for carrying out their business to gain a competitive advantage over others. If you want to keep all your unique inventions, customer information, process, designs, patterns, strategy, etc. a secret and prevent others from using it, then entering into a non-disclosure agreement to protect your trade secrets would benefit you.

If you opt for protecting your information with a patent, the information is published and known to the public. Your information is accessible to everyone and they have insights into your strategy or what goes on in your business. This can be helpful for people who want to publish their information and protect it from getting exploited, copied, and used in an unauthorised manner. For example, when a company invents a light-bulb with its own unique functioning and technology which was never invented by any other company, it will choose to protect it with a patent and prevent others from producing a similar product with similar technology. However, this does not stop the competitor from inventing a competing product with a more advanced technology thereby increasing the competition in the market.

Cost

The choice of choosing between a patent and a trade secret will completely depend upon the producer of the information. However, it is also important to note that the cost of obtaining a patent is higher than trade secrets. Hence, it will also depend on how much the producer is ready or able to invest in the protection of his information along with all the other factors mentioned above. After taking all the factors into consideration, it becomes easier for the inventor to choose the right way to protect their inventions.

Conclusion

Whenever there are new inventions produced that give a competitive advantage and economic value to its producer, it becomes necessary to protect these inventions from being used in an unauthorized manner by the competitors or the people to whom it is disclosed and thereby causing a loss to the producer. These inventions can be protected with trade secrets or patents and it is important to understand the use of each of these intellectual property rights. Trade secrets are used to protect the information that is confidential and prevent them from reaching the public domain whereas the patents help in giving the exclusive right of ownership to the producer and the information is in the public domain and prevents others from producing a similar product. The invention of new technology and products is very important today. Along with this development, comes the risk of losing our valuable information and facing a loss and here, intellectual property rights come to our rescue, helping us innovate and pave the way towards development.

References

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All you need to know about source-code escrow agreements

By

Rachit Garg

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September 25, 2021

0

This article has been written by Sayantani Chakraborty, pursuing a Diploma in Advanced Contract Drafting, Negotiation and Dispute Resolution from LawSikho. The article has been edited by Ruchika Mohapatra (Associate, LawSikho) and Dipshi Swara (Senior Associate, LawSikho).

Table of Contents

Introduction

The sign of maturity is often synonymized with questioning others’ beliefs or practices and the same stands true for the business culture today. If we consider the source code escrow, many companies have a standard policy to escrow the source code of the software product to which they would be the licensee. The source code escrow agreement is entered as an investment to run their business. Before we delve into the agreement aspect of it, let’s understand the meaning of source code escrow and why it is important.

Meaning of “source-code”

Companies around the globe run on several custom software applications and this software is developed by the software developers. Implementation of this software is crucial to the running of the business thus, the developers enter into license agreements with the companies. The developers store the “source code” critical for business in the escrow account. The source code is defined as a “logical statement in sequential format written in a computer programming language”.

It directs the software and controls the data. The source code is written and designed by software developers and they use programming languages such as C++ or Java to develop a source code. After the formulation of the source code they are made into “executable codes”. The executable code is used to download, install, and can run on a computer system of the organization. But the executable mode prevents the customer from seeing the actual function of the software or modifying the operation of the software.

Repairing the software or making any operational changes is only possible with the help of the source code, and this source code and documentation related to it remain with the escrow agent. The source code or the documentation is released only when the developer or the licensor files bankruptcy and fails to carry the obligations under the license agreement. The arrangement between the licensor and the licensee is an arrangement and can also be termed as a “software escrow agreement”. It is the same as that of the “source-code escrow agreement and is explained in detail further in this article.

Software Escrow Agreement

A software escrow agreement is an agreement consisting of three parties namely, the software developer, the buyer, and the end-user who is also known as the beneficiary and the escrow agent. The escrow agent is the neutral party in this agreement. For a comprehensive intellectual property strategy, many companies adopt certain mechanisms to protect their investment in the software they purchase from software developers to run their businesses. Software escrow agreement is one such mechanism to protect such investment.

A software escrow is the deposition of the source code by the software developer to a neutral software escrow agent (third-party). A software escrow agreement comes into the picture when the buyer (licensee) enters into a software licensing agreement with a software developer (licensor) to ensure that the developer carries out the maintenance and development obligations under the license agreement.

Need for Source-Code Escrow Agreements

The software developers often enter into licensing agreements with companies but the major share of their profits comes from maintenance agreements. The maintenance contracts fetch more profits than the licensing fees and the developers can hold the companies to stay in the contract for a longer period. This kind of contract entails services in addition to the maintenance of the code. It is pertinent to mention that although most developers offer software licenses to the clients the license is only for the object code which can be read by a machine, unlike the source code which can be deciphered by a person.

Apart from leveraging the maintenance contract by establishing a long-term association with the clients, the developers fear the risk of the source code being copied, modified which would affect the other parts of the code. On the other hand, the licensee or the client always wants to protect their investment in the software and ensure that it is not lost in case the developer fails to maintain the same as per the license agreement and stops providing the object code. Therefore, the licensee requires access to the source code as the developer no longer shares the object code as per the agreement.

Source-Code Escrow Agreement as a risk minimization strategy

While negotiating a software license agreement, any prudent licensee would weigh the contingencies in the event the developer or the licensor goes out of business or become insolvent. In such a situation what follows the licensee’s request for the source code and other critical data to be able to run their business.

The perspective of the Licensor

From the software developer’s perspective, giving away the source code to the licensee might prove to be risky. The licensor fears that the licensee would not keep the source code safe and secure and if all the licensees demand the source code then there would be a huge loss to the business of the developer.

The second risk is to minimize the chance of releasing the source code to the licensee. The developers tend to maintain a circumstance wherein the escrow agent would not release the source code due to incumbent business decisions. If the product reaches its end then it would not trigger a release event and the licensor would invoke the migration clause of the agreement.

The perspective of the licensee

The licensee’s concern is that if it does not get access to the source code and other materials to maintain and update the software they are heavily dependent on, their business would suffer immensely.

Further, if the developer does not file bankruptcy it would continue to exist as a business and fails to abide by the terms of the escrow agreement. Another perspective of the licensee is that the developer can be acquired by a competitor of the licensor which would be harmful to the licensor. The risk factor lies in the changing dynamics between the developer and the acquirer, wherein the latter refuses to provide the support it had agreed to before the acquisition.

Why Escrow Agreements are ineffective

The reasons mentioned above make a source-code escrow agreement an excellent business and investment decision by the customers. However, certain concerns weigh more than the prospects of such an arrangement. They are as follows:

1. Escrows are hardly released

A small number of escrows are released by the escrow agents, even the dominant agents do not release the source codes as per the agreement. It is fathomed that either the events that trigger the release do not occur or the customers find it easy to go for other developers.

2. Outdated or defective Escrow Source-code

Many customers consider the escrow agreement as their “insurance policy” but often they are devastated when the release event takes place. Either the source code is found to be defective or they become outdated due to lack of maintenance by the developer.

3. Licensee unable to use the source-code

The purpose of escrowing the source code is mainly due to the vendor which provides technical know-how, skill, and expertise to the customer as the customer does not possess the capability or the required expertise. So, even if the customer can release the source code, it cannot implement the same internally.

4. Delays and lawsuits

Often it is seen that the vendor causes a delay in releasing the source code and the customers have no recourse to prevent such actions on the part of vendors. The clause of the agreement states that the vendor’s permission or approval is a prerequisite for the release of the source code. This situation results in mediation or arbitration between the parties and sometimes lawsuits are filed as well adding to the delay.

5. Expense is borne by the licensee

While escrow agreements are entered into keeping in mind, the investment risks of the customers, the drafting, negotiation and the fees of the lawyers is borne by the licensor in most cases. No matter how intensely these agreements are negotiated, the customers are an at all-time risk that the vendor/licensor disputes their claim to the source code. Despite spending thousands of dollars on the escrow arrangements, the customers are still unsure about the proper release of the code and the related documents.

Negotiating the Source-code Escrow Agreement

Once a developer develops a software application, it becomes his intellectual property. The owner of intellectual property would never want anyone to copy the source code of the software he developed. At the same time, some businesses require software applications to run their businesses and that software becomes critical to their businesses. Therefore, the source-code escrow agreement comes into the picture. However, it is difficult to negotiate this kind of agreement wherein three parties are involved, nonetheless, it can be beneficial for the licensor. On the contrary, the licensee is at a loss if the arrangement is not negotiated sternly concerning the “release” clause.

Let’s see some of the important clauses of the Source-Code Escrow Agreement which is attached and is supplementary to the main Licensing Agreement between the Developer and Licensee:

1. Definition Clause– the main terms used in the agreement must be precisely defined under the definition clause. Those terms include but are not limited to: “User”, “Developer”, “Escrow Agent”, “License Agreement”, “and Bankruptcy Code”.

2. Purpose of the Agreement – Shall define the purpose of the parties behind the entering of the agreement/arrangement. That the developer will store with escrow agent certain source-code. The vendor would have access to the code as per the terms of the agreement.

3. Materials – The materials pertain to the documents, code, trade secrets or any other intellectual property deposited with the escrow agent by the vendor. These are licensed to the users and users can claim them in any event of default as per the terms of the agreement.

4. Treatment of Material– It is agreed that the materials shall not be disclosed or shared except to the developer and the user who is entitled to them as per the terms of the agreement.

5. Release Conditions – this clause is the most important wherein the licensee shall negotiate intensely as the vendor refuses to release the source code easily fearing intellectual property theft:

a. Bankruptcy of the licensor

b. Event of default

c. Contrary Instructions from Licensor

6. Representations and Warranties by Escrow Agent

7. Representations and Warranties by Developer

8. Fees – The escrow agent shall be paid by the developer or the user or by both as agreed by the parties. Mostly it is paid by the user/licensee.

9. Discharge of Escrow agent– The agent is discharged if the developer takes away all the materials, documents from the agent.

10. Indemnity and liability of the escrow agent– The developer is liable to indemnify the escrow agent and shall hold it not liable for any loss except any loss that is incurred due to negligence of the agent itself.

11. Termination Clause – The parties must mention the events under which the agreement shall be terminated by either of them.

12. Applicable law – The law of the country or any state law or federal shall apply to the agreement.

13. Dispute Resolution/Arbitration Clause– The parties often choose arbitration as a method of dispute resolution between them. Mediation is also considered but in few cases only.

14. Notices – The notice period for any termination shall be mentioned and the mode of communication such notices shall be mentioned clearly by the parties.

The above terms of the agreement are not exclusive and can be tailored as per the requirement of the parties to the agreement. The general clauses have been covered in this article which is nevertheless less important.

Conclusion

Software escrows are vital for the software licensors as their strategy is to protect the intellectual property attached to them. The licensees on the other side face difficulty in accessing the source code vital to running their businesses. Thus, it is essential to negotiate the terms of the source-code escrow agreement diligently, keeping in mind the issues that might arise in the event of bankruptcy, non-maintenance, or other legal battles. It is suggested that the licensee must incorporate a clause where the developer shall provide technical personnel in the event of a release of the code when the licensee is unable to make it work. This kind of agreement does not work in a vacuum unless the licensee includes such clauses that provide for hiring personnel from outside who are familiar with the software application when an unwantedsituation arises.

Bibliography

1. https://assets.fenwick.com/legacy/FenwickDocuments/Software_Escrows.pdf

2. https://www.jonesday.com/en/insights/2008/03/source-code-escrow-are-you-just-following-the-herd-ciocom

3. https://ehscp.org/resources/Documents/2001Conference/JonesBW9-ESCROW.pdf

4.https://uk.practicallaw.thomsonreuters.com/Cosi/SignOn?redirectTo=%2f6-502-4093%3ftransitionType%3dDefault%26contextData%3d(sc.Default)%26firstPage%3dtrue

5. https://www.lawinsider.com/clause/source-code-escrow

6. https://www.devdept.com/Store/Escrow

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An overview of taxation on media and entertainment under Goods and Services Tax

By

Diva Rai

-

September 25, 2021

0

This article is written by Raghav Singhal, pursuing a Diploma in Intellectual Property, Media and Entertainment Laws, from LawSikho. The article has been edited by Khushi Sharma (Trainee Associate, Blog iPleaders) and Vanshika Kapoor (Senior Managing Editor, Blog iPleaders).

Introduction

Media and Entertainment is the most popular and ever-growing industry. The Media and Entertainment industry has been divided into many divisions that are linked into one vertical such as film, television, radio and print. New generation technology is acting as a stimulus in fading the old generation of Media and Entertainment. Combination of evolving generations persistently making the M&E sector boom in demand globally. Equivalently the trends in the very industry vary according to region and consumers making the vertical exclusive, by complementing the demand for entertainment worldwide.

Since ancient times, taxes have been a part of the living. We can not imagine humans living without taxes. We live in a world where we have to pay taxes in lieu of something as the taxes play a major role in the revenue collection to the government. There are mainly 2 types of taxation systems in India, one is Direct Taxation and other one is Indirect Taxation. The Media and Entertainment industry is covered under the head of Entertainment Tax in the Service Tax regime before 2017. The Indirect Taxation legislation covered cinema under the luxury tax and put it under the highest rate slab 28%. In this article we will analyze the aspects of Indirect Taxation i.e., Goods and Services Tax on the Media and Entertainment Industry.

What is goods and services tax?

Before 1-July-2017 we had many heads under the Indirect Taxation regime such as Service Tax, Wealth Tax, Excise Duty, VAT and much more. After the launch of GST in India it subsumes many different types of taxes and now we have One Tax One Nation.

Goods and Service Tax (GST) is a destination-based tax and is levied on the supply of goods and services. GST is a single tax that will be levied on the entire nation. Goods and Services Tax constitutes mainly 3 heads under which taxes are levied i.e CGST(Center Goods and Services Tax Act), SGST(State Goods and Services Tax Act), IGST(Integrated Goods and Services Tax Act ). IGST. There exist two types of business transaction (Intra-State) transaction and (Inter-State) transactions, intrastate transactions are those which occur in the particular state and Inter-state transactions are those which occur between two states.

Illustration

Let us take a situation where the dealer of chemicals who is in the business of supplying chemicals has supplied the goods from Uttar Pradesh to the dealer in Punjab worth Rs. 60,000. The rate of tax applicable is 18% consisting of only IGST.

In that case, the dealer will charge IGST of Rs.10,800. The revenue of 10,800/- will go to the Central Government.

The same chemical dealer sold the goods within the same state i.e. in Uttar Pradesh itself to a consumer in Uttar Pradesh worth Rs. 60,000. The GST rate on goods is 12%. This rate comprises CGST at 6% and SGST at 6%.

The supplier has to collect Rs.7,200 as Goods and Service Tax, Rs.3600 will go to the Central Government and Rs.3,600 will go to the Uttar Pradesh government since the sale is within the state.

The purpose of GST is as follows:

To achieve the ideology of ‘One Nation, One Tax’.
To subsume a majority of the indirect taxes in India.
To eliminate the cascading effect of taxes.
To curb tax evasion.
To increase the taxpayer base.
Online procedures for ease of doing business.
An improved logistics and distribution system.
To promote competitive pricing and increase consumption.

Pre GST era flow chart is mentioned but no flowchart has been added.

Impact of GST on the different industries in the media and entertainment industry

Exhibition of Movies

The exhibition of the movie is the retail branch of the film industry. It involves the public screening of the movies in theatres where the customers pay the money for the purpose of watching movies for their entertainment purpose.

Pre-GST	GST
On the Sale of tickets: Entertainment tax was levied ranging from 15% to 110%	On Sale of tickets: here we have two slabs below Rs 100 18% GST is applicable and above Rs. 100 28% GST is leviable

Food and Beverages at Theatres

Pre-GST	GST
Here the tax is levied under 2 heads: VAT @20.5% (Assumed) and Service Tax @15%	Here In GST 18%or, 12% is levied according to the conditions prescribedSupply of Food and beverages are considered as restaurant Services and the tax applicability depends on the Air Condition Services if the Supply is done in AC premises then 18% is applied and in Non Ac premises then 12% is levied

Film Distribution

Pre-GST	GST
Copyright transfer for the exhibition of movies in Theatre: double Tax is imposed, VAT and Service Tax which creating a burden on the producers	Here transfer of copyrights is treated as the supply of services under GST and the rate of tax is 12%
Trademarks, Copyrights like Intellectual Property had been treated as goods and attracted State VAT	Here 2 rate slabs are: transfer of (IP) rights in respect of Software rate is 18% and 12% rate is leviable in respect of goods other than information technology software

Services rendered by Artists and other technicians

Pre-GST	GST
Taxability on Artist services levied @ 15% Service Tax on forward charge basis	Under GST @ 18% tax rate is applicable in the services rendered by the Artist on forward charge basisServices rendered by author, music composer, photographer, artist or the like by way of transfer or permitting the use.
15% Service Tax is levied on the services by technicians like composers, photographers on Forward Charge basis.	Supply of services by an author, music composer, photographer, artist or the like by way of transfer or permitting the use of copyright attracts 18% GST on reverse charge basis (RCM)

Sponsorship and Brand Promotion

Pre-GST	GST
Liable to service tax @ 15%	Liable to GST @ 18%

Amusement Parks

Pre-GST	GST
State-specific Entertainment tax ranging from 15% to 110% (average of 30%) No VAT or Service Tax	GST at 18%

Impact

After the emergence of all the different types of indirect taxes under the single head of GST, there is a sigh of relief to the consumers as the overall burden of different small taxes which was creating a cascading effect and was anytime borne directly or indirectly by the end under itself. Mostly the states that have heavy entertainment taxes are benefited but some of the states also persist that have very low rates even if compared to the GST, but if we take an average count, the implementation of GST has benefited the entire industry helping in growth with increased digitization at lower costs.

What is FCM & RCM

Forward Charge Mechanism (FCM) is a process in which the tax is charged in the Sale Invoice by the supplier and the same is collected from the purchaser and finally deposited to the government, this is also known as the simple method in this case mostly both the parties are registered.

Reverse Charge Mechanism (RCM) is the process in which the payment of tax is paid by the recipient. In this case, mostly the supplier of service is an unregistered person or the person is who is outside India which is automatically is out of the scope of GST, so on their behalf the recipient of service is liable to pay GST to the government on their behalf.

The mechanism of RCM can be clearly understood in the case of Udayan Cinema Pvt. Ltd. Case Number 44 of 2018, Order number 45/WBAAR/2018-2019 and ARN AD1911180006556.

Background

The Applicant intended to produce a feature film, a portion of which was planned to be shot at locations outside India. For this purpose, he was in the process of appointing CDI Virtual Films Inc. (hereinafter the CDIVF) as a Line Producer in Brazil.

Issues

Whether he is liable to pay IGST on the reverse charge on the payments to be made to CDIVF and, if so, what should be the rate depending upon the classification of the service of a Line Producer.
Whether the reimbursements made on an actual cost basis will also be subject to IGST.

Admissibility of Application

The questions raised are admissible for an advance ruling under section 97(2) (a), (b) & (e) of the GST Act, read with section 20(xviii) of the IGST Act, 2017.

The Applicant declared that the issues raised in the application are not pending nor decided in any proceedings under any provisions of the GST Act. The officer concerned from the revenue had raised no objection to the admissibility of the Application.

The Application is, therefore, admitted.

Analysis

The concept of reverse charge is laid depending upon the location of the recipient of service so the liability to pay IGST on the reverse charge on the payments to be made to CDIVF depends wholly upon the location of the recipient. The Applicant, a resident of India, will receive the service in Brazil, where it has no fixed establishments or a specific location at which the service is being supplied. The location of the recipient should, therefore, be the usual place of his residence in terms of section 2(14)(d) of the IGST Act, 2017. The recipient is, therefore, located in the taxable territory. Tax is, therefore, payable on RCM in terms of Sl. No. 1 of Notification No. 10/2017 – IGST (Rate) dated 28/06/2017, provided the transaction constitutes an inter-State supply within the meaning of section 7(4) of the IGST Act, 2017.

What are the advantages and disadvantages of gst in the context of media and entertainment

Advantages of GST

Lease of Film/television content rights

Earlier, in the old regime of Indirect taxation there always remained confusion in the case of lease of film/ television content rights. A conflicting issue arose, whether the transaction of lease of film content will be considered as supply of goods or supply of services.

As in the old regime VAT will be applicable on supply of goods and on supply of services Service tax was levied so because of the non-clarity of the pattern mostly for the safer side both VAT and Service Tax was applicable and a burden of @21% (15% Service Tax & 6% VAT) in Maharashtra is levied.

After the implementation of GST, the supply of lease of Film content rights will be a service and will attract 12% GST Tax.

Input Tax credit (ITC) for Distributors

Input Tax Credit is the main driving force and the hot topic of discussion in the GST. Input Tax Credit helps in the smooth running of the business. After the GST came into force the benefit of ITC will be claimed by the Film Distributors which is paid by the producers and according to the chain, continues such as the theatre owners will claim ITC of the GST paid by the distributors etc.

Disadvantages

Non Availability of ITC

In GST, there are some transactions that are Blocked under the GST. There is a specific section in GST that states that ITC is not allowed in a certain inward supply of goods and services.

In the film industry, shooting in different locations at odd hours is a very basic thing and it is a very common practice of serving food and beverages while shooting to provide convenience to the actors and staff and other members of the crew and also the outdoor catering services. These are the additional costs to the production as in the GST regime under section 17(5)(b)(i) the ITC of such above-mentioned services are blocked and not ITC is allowed.

States not entitled to grant tax exemption Status

When a film imparts knowledge or which gives a social message, in the old regime of Indirect Taxation it was at the discretion of the state to give exemption on the entertainment tax or to levy lower rates on the movie tickets. In the GST regime, this state power is abolished and the state has no power to tamper with the GST rates.

GST and world : a global scenario

India possesses the highest GST rate in the world. The maximum GST rate slab of 28% introduced by India is the highest among more than 160 countries across the world that have implemented GST. Argentina has the second-highest GST rate of 27%, whereas the rate stands at 20% in the UK, 20% in France and 7% in Singapore. To minimise tax evasion and also to stop the cascading effect of tax evasion in the economy over 160 countries across the globe had adopted the Goods and Services Tax regime.

France was the primary country to adopt this single tax system in 1954 and followed by Germany, Italy, Japan, South Korea. GST is one of the top initiatives taken by most countries for a structured and developed economy. India took years in implementation of GST than other countries in the world and finally in the year 2017 India also adopted GST regime A value-added tax levied on mainly goods and services provided or sold for domestic or household consumption is called Goods and Service Tax. GST provides revenue or income for the government in the growth procedure of the economy. The section of GST that is accumulated or collected from the consumers by the business or seller of the goods, is forwarded to the government. In some countries, Goods and Service Tax is also acknowledged as Value Added Tax.

GST in other countries

GST tax Rate in some countries

Country	Implementing Year	Highest Tax rate
India	2017	28%
Canada	1991	5%
New Zealand	1986	15%
Singapore	1994	7%
Australia	2000	10%
Brazil	1984	17%
Malaysia	2015	6% and varies

GST in Canada

GST is now one of the major sources of revenue for the Canadian government. Despite huge opposition from both the political rivals and the public, the Conservative dominant House of Commons approximately 25 years ago had passed the GST bill. In the fiscal year 2013-14, the total amount of revenues constitutes 1.6 per cent of the total gross domestic product (GDP). The amount is projected to have a steady increase in the coming year.

The taxation regime of Canada is mainly carried out under the 3 schemes i.e. Federal GST, Joint federal and separate federal. Federal tax is a generally accepted tax system while joint federal runs on the basis of the synchronised behaviour of the economy and states and the last one is separate federal which only applies to Quebec as it is deemed as a quasi-independent province. The basic GST rate is 5% on the supplies of goods and services and in some regions, 15% sales tax is also imposed. From 1991, a Multi-level VAT structure was enforced on supplies of goods and services purchased in Canada. There are no such exemptions on goods and services from the ambit of GST, only a few prescribed groceries, residential rent, and medical services.

GST in Singapore

The introduction of GST is seen as a means to lower personal and corporate income tax rates while maintaining a steady revenue base for the government. GST in Singapore was introduced in 1994 as an indirect tax as it taxes expenditure.

Presently GST is charged at the rate of 7%. The GST Act is modelled off the UK VAT legislation and New Zealand GST legislation. The authority which collects, administers, assesses and enforces the payment of GST is acknowledged as The Inland Revenue Authority of Singapore (IRAS) which operates as an agent of the Singapore Government.

GST in Australia

GST in Australia is collected by the Supreme Authority as it is a federal tax and after amassing the tax it is further divided among the states without any disputes. The GST was introduced in 2000 with a tax rate of Rs 10% maintaining the consistency in the rates till date.

Australia’s GST is generally considered to be one of the more efficient types of taxes. After the implementation of GST, there is an elimination of inefficient taxes at the state level that impede labour mobility and allow for reductions in federal personal income taxes that would encourage increases in labour supply and saving. International organisations such as the International Monetary Fund (IMF) have recognised the implications of these efficiency differences, suggesting in 2010 that they would “welcome more reliance on consumption-based taxes in Australia.

There are certain products and services which are exempted from GST

Most basic foods, some education courses and some medical, health and care products and services are GST-free, often referred to as exempt from GST.

Conclusion

One Tax One Nation One Market is the main motto of the GST which proves to be a boon for the entire world. After the implementation of GST in India, the revenue collection has increased drastically, within these 4 years the government has gained maximum revenue. GST law is designed in such a way that helps in preventing tax evasion leaving no loophole for the fraudsters to evade taxes. Under GST there is a free flow of Input Tax Credit which aids in the smooth running of the business and gives relief to many sectors from the high rate of taxes charged on the goods and services.

However, if we go through some practical aspects there are many business transactions that are in need of clarification. Organizations will now have to gear up both in terms of IT infrastructure and business processes to embrace the full potential of the new tax regime which looks all set to become a reality very soon.

Media and Entertainment is an ever-changing industry that has become a need for everyone. But it has been seen that in all the tax regimes whether Pre- GST or Post GST the M&E sector was always placed in the highest tax slab. The government should see through it and also shift the tax slab of the M&E industry from Luxury Tax to the lower tax rate slab.

References

https://www.wirc-icai.org/images/material/WIRC-Deloitte-presentation-GST-impact-ME-sector.pdf
https://cleartax.in/s/media-entertainment-taxation-gst
https://cleartax.in/s/gst-law-goods-and-services-tax
https://www.gstzen.in/a/application-for-advance-ruling-cgst-act-section-97.html
https://blog.saginfotech.com/gst-india-vs-foreign-gst

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All you need to know about the registration of trade unions

By

Rachit Garg

-

September 25, 2021

0

1560157177 — Image source: https://bit.ly/3EQYhFX

This article has been written by Tanu Mehta. The article has been edited by Khushi Sharma (Trainee Associate, Blog iPleaders) and Vanshika Kapoor (Senior Managing Editor, Blog iPleaders).

Background

As modernisation and industrialization emerged and grew, trade unions were formed eventually. Trade unions are basically an association of employees who share common goals to achieve. Due to various social and economic evils, it became necessary for the employees to devise effective means to deal with the employers in the form of trade unions.

Deteriorating economic conditions and low wages resulted in further growth of the trade unions.

Introduction

During the end of 1925, the number of trade unions eventually increased. They demanded for securing the rights of the employees and machinery dealing with settlement and prevention of industrial disputes. The continuous exploitation of the employees by the employers resulted in the formation of the ‘Trade Unions Act, 1926’ in order to protect their interests and fulfil their genuine demands. This Act legalised the right to form and organise unions and therefore, allowed the employees to form trade unions.

The Act laid down detailed provisions for the procedure, formation, conditions for the registration of trade unions, advantages of the procedure, advantages of registration and immunities available to the union leaders from civil and criminal laws for the activities of a registered trade union.

Definition

Indian Trade Unions Act, 1926 defines trade unions as “ any combination, whether temporary or permanent, formed primarily for the purpose of regulating the relations between workmen and employers or between workmen and workmen, or between employers and employers, or for imposing restrictive conditions on the conduct of any trade or business and includes any federation of two or more trade unions”.

Chapter II of the Trade Unions Act, 1926 deals with the provisions of the registration of the trade unions.

Procedure for registration of a trade union

Under Section 3, the registrar is appointed for the process of registration of the trade union.

Also, the appropriate government is authorised to appoint additional and deputy registrars for a particular state, where the registrar of a trade union is unable to discharge the powers and functions. Within a local limit, he may exercise the power and functions as Registrar as prescribed for this purpose.

Mode of registration

Section 4(1) of the Act, talks about the registration of trade unions. Which says that for the purpose of registration of the trade union, there should be a minimum of seven members. The reason behind the fixation of a minimum of seven members is to encourage the formation of more and more trade unions.

In order to summarize, Section-7 talks about the two conditions required to fulfil the registration of a trade union. These conditions are:-

Requirement of seven or more members as signatories.
Provided that there are 100 or 10% whichever is less are employed in the industry.

Section 4(2) of the Act mentions that any application made under Section (1) regarding the registration of a trade union cannot be termed as invalid merely on the reason that some of the applicants not exceeding half of the total number of persons have:

Either ceased to be the members of trade union before the registration of the Trade union; or
Has given written notice in writing to the Registrar mentioning their dissociation.

Tirumala Tirupati Devasthanam (1993)

In this case, the Court held that for the purpose of regulating the relations between the workmen and the employers, any group of employees may be registered as a trade union under the Act.

Application for registration

According to the Section-5, the application shall be made to the registrar for the registration of trade union and it should be followed with the copy of the rules of the trade union and the following particulars:

The name, occupation and address of the members who all are making the application;
The name of the trade union and the address of its head office; and
The titles, names, ages, addresses and occupations of the office-bearers of the trade union.

If a trade union already exists for more than a year, then a copy of the assets and liabilities of the trade union should be submitted along with the application for registration.

Provisions to be contained in the rules of a trade union

As per Section-6 of the Act, a trade union shall not be entitled to register under the act, if the provisions and rules mentioned under the Act are not duly complied. The rules are as following:-

The name of the trade union;
The object for which the trade union has been established;
The whole of the purposes for which the general funds of the trade union shall be applicable;
The maintenance of a list of the members of the trade union;
The admission of ordinary members (a person engaged or employed in the industry) with which the trade union is connected;
The conditions under which any member shall be entitled to any benefit assured by the rules.

And under which any fine or forfeiture may be imposed on the members:

The manner in which the rules shall be amended, varied or rescinded;
The manner in which the members of the executive and the other office-bearers of the Trade Union shall be elected and removed;
The manner in which the trade union may be dissolved.

Power to call

As per Section 7, the registrar may call members of the application to acquire further information to check whether the application is complete as per the provision of Section 5, or the trade union is enabling for registration under Section 6, and if all such information is incomplete, the registrar may refuse to register the Trade Union.

The registrar has the power to call the person applying for registration to alter the name of the trade union, if the name of the trade union proposed by the person applying for registration is identical to the name of the existing registered trade union or if the registrar finds it bit similar, which tends to fool the public or the members of either trade union. If such alteration doesn’t take place, the registrar shall refuse to register the union.

Registration

Section 8 of the Act mentions that if the Registrar is satisfied that the Trade Union has complied with all the requirements of the Act in regard to the registration, then he shall register the Trade union.

North Central Railway Employees Sangh and Others (2017)

In this case, the Court held that in order to check whether the registration is given rightly or not, the same can be examined only by the competent statutory authority established under the Trade Unions Act. The other authorities like the police have no role in this.

Inland Seam Navigation Workers’ Union (1968)

An application was made by the workers’ union to the registrar for registration. But the application was declared unlawful by the registrar by stating the reason that the objects mentioned are for all practical purposes.

Held- The Court said that the duties of the registrar include examining the application, looking at the objects for which the union is formed. If the objects for registration falls as per the Act and all the requirements and regulations made are complied as per the act, then it is the duty of the registrar to register the union.

ONGC Workmen’s Association (1988)

In this case, the Court made it clear that the registrar is not deemed to be a quasi-judicial authority. He is not entitled to decide any disputed question of fActor law. The Registrar has no authority to ask parties to lead evidence or to cross-examine any witness.

Therefore, it can be said that under Section-8, the authority given to the registrar is limited in nature.

Certificate of registration

As per Section 9, the registrar shall issue a certificate of registration, after registering a trade union under Section 8. The trade union can produce the certificate as evidence that it has been rightly registered under this Act.

Appeal (Section-11)

If any person doesn’t agree with the decisions of the registrar related to:-

Refusal to register the union,
Withdrawal or cancellation of a certificate of registration.

May appeal within the prescribed time, in following-

The head office of a trade union which is situated within the restrictions of a presidency town to the High Court,
The head office of a trade union which is situated, within the jurisdiction of a Labour Court or an Industrial Tribunal, to that court or tribunal as the case may be;
The head office of a trade union which is situated in any area to such court, not subordinate to the court of an additional or assistant judge of a principal Civil Court of original jurisdiction as the appropriate government may appoint.

Accordingly, the court may either refuse the appeal or pass an order governing the registrar to take a suitable course of action.

Compulsory/voluntary registration

As per the Act, the registration of a trade union is not compulsory but is just voluntary in nature.

It is believed that compulsory registration would prove burdensome and expensive and therefore, it is voluntary in nature.

On the other hand, it is argued that the registration should be made compulsory for the trade unions so that they could be governed by the provisions and rules laid down in the Actin a similar manner.

Acts that do not apply to registered trade unions ( Sec-14)

The acts which do not apply to the registered trade unions are:-

The Societies Registration Act,1860 (21 of 1860)
The Co-operatives Societies Act, 1912 (2 of 1912)
The Companies Act,1956 (1 of 1956)

Such Acts shall not apply to any registered trade union, and if any Trade union gets itself registered under any of these acts, then such a registration would be void in nature.

Time period for registration of a trade union

In the Trade Unions Act,1926, no time period has been mentioned for the approval or refusal of registration. It is a statutory duty of the registrar to register the trade union if all the requirements of registration are fulfilled duly. But in case, if any provision is not fulfilled then there is no time limit for the grant or refuse the registration.

CASE LAW- ACC Rajanka Lime Stone Quarries Mazdoor Union v. Registrar of Trade unions (1958)

Facts- The petitioner sent an application for registration of Union on 31st July 1957 to the registrar of Trade Unions Government of Bihar, Patna, under a registered postal cover with acknowledgement due. The Registrar of Trade Union received the application on the 3rd of August, 1957. For a long time, there was no action taken by the Registrar of Trade Unions.

Petitioner sent many reminders to the Registrar to speed up the process of registration and on 23rd September, a telegraphic reminder was sent by the petitioner, but there was no response to it.

No action was taken for over 3 months, therefore the Union filed a writ petition before the Patna High Court. It requested that the Registrar of Trade Unions should be governed to register or refuse to register the Union as his statutory duty.

Judgement– It was held by the High Court of Patna that, if the Registrar is satisfied that application of registration is fulfilled with all the requirements of the Act, then as per Section 8 it is his statutory duty to register a trade union. The court authorized the registrar to deal with the application of the trade union according to the law as soon as possible.

Cancellation of registration

As per Section 10 of the Act, the registration of the trade union can be cancelled if the certificate of registration is withdrawn or cancelled by the registrar-

On the application of the Trade union.
If the registrar is satisfied that the certificate of registration is obtained by mistake or fraud.

OR

The Trade union has ceased to exist.

OR

The Trade union has wilfully contravened the provisions of the act even after the notice from the registrar.

Legal status of a registered trade union

Trade union which is registered shall be a body corporate ( means a separate legal entity of trade union) under the name it has been registered.
Trade unions have perpetual succession which means the existence of the union or the continuation regardless of any death, change in membership etc. and a common seal.
It also has the power to obtain and hold movable and immovable property and can be a party to contract,
It can sue and be sued by the name which is registered.

No civil suit or legal proceeding can proceed against a trade union, related to any Actdone in pursuit of a trade dispute in a certain situation.

Benefits of registration of trade unions

A registered trade union acquires the status of a separate legal entity, which means that it can enter into contracts and can also sue others.

Privileges of registered trade unions

The Trade Unions Act, 1926 has made provisions under Sections 17 & 18. Section 17 provides an exemption from punishment of criminal conspiracy:

Imprisonment for not more than six months.
Fine or both.

to the members or office-bearers of a registered trade union, related to any agreement made between the members with the purpose of facilitating objects of a trade union.

Section 18 provides immunity from civil proceedings:-

To the registered trade union,
Any members or office bearers.

Related to any Actdone in pursuit of a trade dispute to which a member of the trade is a party on the basis that such Acts Provokes some other person:

To breach a contract of employment,
To interfere in trade, business, employment or some other person,
Interference with the right of some other person to destroy his capital or of his labour.

Immunities of registration of trade unions

Section 17 provides immunity from the criminal liability.
Section 18 provides immunity from civil liability.
Section 19 gives the privilege to make agreements in restraint of trade.

Difference between registration and recognition of trade unions

The main difference between registration and recognition of trade unions is that registration is done by the registrar and recognition is done by management as a collective bargaining agent.

None of them is mandatory under the Trade Union Act. Registered trade unions have certain inherent benefits with it. Whereas recognition of trade union has no inherent right and once they are recognised, it leads to conferred certain rights upon them.
National Labour Commission Reports on registration of Trade Unions

In view of the Trade unions Act, 1926 the National Labour Commission has proposed various recommendations in the year 1969 –

The registration of Trade unions which is voluntary should be made compulsory.

Some time limit should be prescribed for the Registrar to decide on the issue of registration.
Effective measures must be taken for cancellation if the conditions mentioned in the Act are not complied with by the unions.

After the above-mentioned recommendations, various enactments were passed.

After this, a Second National Labour Commission was established and consequently, a second report was submitted in the year 2002.

In this report, the commission recommended the eligibility condition i.e. requirement of 10 per cent membership shall not apply in the case of unions in the unorganised sector.

Conclusion

The existence of a trade union creates a healthy working relationship between the employer and the employees.

It is because of trade unions that the workers feel that their rights are duly protected and can anytime create pressure on the employers if they feel that employers are overpowering them unnecessarily.

Apart from this the registration of trade unions under the Trade Union Act, 1926 helped the trade unions to gain recognition and certification. The detailed provisions of the Act talk about the procedure, advantages of registering Trade unions and various immunities available to the union leaders from civil and criminal laws for the activities of a registered trade union.

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