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Political empowerment of women through restructured Panchayati Raj institutions

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This article is written by Srishti Sinha, a student at the Institute of Law, Nirma University, Ahmedabad. This article deals with the empowerment of women in Indian society through Panchayati Raj Institutions.

Introduction 

Women empowerment is a topic that comes up frequently in discussions about human rights and development. It is a vital precondition for every society’s overall growth. Even though women make up over half of the population, they are still oppressed and have uneven socioeconomic and political positions. For decades, women’s empowerment has been a hot topic in India and internationally. Women in India who are submissive to males must be empowered to overcome social, political, and economic inequality. Since India’s independence in 1947, there have been numerous initiatives to enhance women’s status. The Constitution (Seventy-Third Amendment) Act, 1992 is a significant step forward in women’s political empowerment through Panchayati Raj institutions. As a result, a substantial number of women who were formerly homemakers have gained access to decision-making bodies in rural regions.

Panchayati Raj institution

The Panchayati Raj institution is an Indian system of local self-government in rural areas. It was formed by state legislatures in all the states of India to help develop democracy at the grassroots level. It was created by the 73rd Amendment Act and is responsible for rural development.

Evolution of Panchayati Raj in India 

The notion of Panchayati Raj was not new to India. From ancient times, Indian communities had Panchayats (five-person councils) with executive and judicial responsibilities and were responsible for resolving different issues (land distribution, tax collection, etc.) and conflicts that arose in the community. 

  1. The establishment of Panchayati Raj, its structure, and its organization was firstly recommended by the Balwantrai Mehta Committee in 1957. This Committee recommended the establishment of a three-tier system at the village, block, and district levels. On October 2, 1959, Rajasthan became the first state to implement Panchayati Raj, which began in Nagaur district. 
  2. After that, in December 1977, the Ashok Mehta Committee on Panchayati Raj was established. In August 1978, it issued a report with several suggestions to resuscitate and improve the country’s ailing Panchayati Raj system. Its main recommendations were a two-tier panchayat system, frequent social audits, political party representation at all levels of panchayat elections, provisions for regular elections, reservation for SCs/STs in panchayats, and a Panchayati Raj Minister in the state council of ministers.
  3. Later, the G V K Rao Committee, in 1985, again recommended adding some measures to strengthen Panchayati Raj Institutions. 
  4. Just after a year, in 1986, L M Singhvi Committee recommended that the constitutional position of Panchayati Raj institutions were also discussed, as well as the constitutional requirements to guarantee that Panchayati Raj Bodies elections be held on a regular, free, and fair basis. Based on this recommendation, a Bill was introduced in the Lok Sabha but it was not passed by the Rajya Sabha. 
  5. Following this, P V Narashima Rao’s administration submitted a Bill in the Lok Sabha in September 1991 for this purpose, which became the 73rd Constitutional Amendment Act of 1992, and went into effect on April 24, 1993. 

Constitutional provisions regarding Panchayati Raj

The 73rd Constitutional Amendment gave constitutional standing to self-government entities known as Panchayati Raj Institutions (PRIs), intending to make democracy more effective at the local level, driven by residents’ demands and involvement. Economic growth, social justice, and the execution of Central and State Government Schemes, including the 29 topics specified in the Eleventh Schedule, have been assigned to Panchayats.

Part IX of the Indian Constitution establishes three tiers of Panchayats (only two levels in the event of States or Union Territories with populations under two million): 

  • Village-level Gram Panchayat,
  • District Panchayats at the district level, and
  • Intermediate Panchayats between Gram Panchayats and District Panchayats at the sub-district level.

It also establishes the Gram Sabha (a general assembly of registered voters who live in the Gram Panchayat’s territory) as a venue for people’s direct participation in local government.

The Indian Constitution established five-year periods for these Panchayats and provided for the reservation of seats for women and underprivileged groups of Indian society (Scheduled Castes and Scheduled Tribes). Women’s reservation is at least 33.33%, whereas the quota for Scheduled Castes (SCs) and Scheduled Tribes (STs) is proportional to their population share. However, according to the information available with the Ministry, 20 states, including Andhra Pradesh, Assam, Bihar, Chhattisgarh, Gujarat, Himachal Pradesh, Jharkhand, Karnataka, Kerala, Madhya Pradesh, Maharashtra, Odisha, Punjab, Rajasthan, Sikkim, Tamil Nadu, Telangana, Tripura, Uttarakhand, and West Bengal, have made provisions of 50% reservation for women in Panchayati Raj Institutions in their respective State Panchayati Raj Acts.

Areas not covered under Part IX

While Part IX of the Constitution applies to a greater part of the country, some places are exempted from Part IX according to Article 243M of the Constitution. The states of Meghalaya, Mizoram, and Nagaland, and regions covered by the Sixth Schedule, the hill parts of Manipur, and district level Panchayats in Darjeeling’s hill districts, are among them. In these locations, there exists a variety of grassroots local governing forms.

How Panchayati Raj institutions are helpful for women?

The 73rd Constitutional Amendment Act, which took effect on April 24, 1993, and became part of the Constitution, has ushered in a quiet change in the country. It aided the admission of about one million women into public life when combined with the 74th Amendment. The initiatives taken by the Panchayati Raj institutions for the political empowerment of women are as follows: 

  1. Women are developing self-confidence and taking self-initiative to fight against discrimination.
  2. Women are getting a platform to make their decisions.
  3. Women are taking steps to come forward and educate other women about education, hygiene, alcohol abuse, etc.  
  4. Every year, the Institute of Social Sciences (ISS) hosts conferences on Panchayati Raj and women’s political, social, and economic empowerment. At these major gatherings, elected representatives of Panchayati Raj Institutions (PRIs) and members of NGOs, notable academicians, social workers, government officials, and media personalities from throughout India attend. The ISS 1995 conference focused on the issues that Panchayats face, with a specific focus on the issues that women members and office bearers face. The participants were completely in agreement on the actions that needed to be done to enhance the system so that women can play their intended role in establishing self-reliant, wealthy communities and, as a result, a lively and thriving society.
  5. Women are rising to the occasion and preparing to engage in politics at a grassroot level in the spirit of self-governance as devoted citizens.
  6. More than one million women have actively participated in India’s political life as a result of the Indian Panchayat Raj Institutions’ experience. Up to one-third of seats in panchayats (chairman and members) are reserved for women.
  7. Women are also working to end child marriage and child domestic labour, as well as promote female education. Furthermore, women have utilized their political power to address crucial concerns such as excellent health care.

Efforts by Government to proliferate women’s participation

The administration has taken several important steps, including raising the reservation level for women in parliament from 30% to 50%. Even though India has succeeded to legislate representation, it is merely the first step towards women being able to make decisions on par with males. To empower women in the public realm, representation alone is insufficient, and unless it is reflected as participation, it stays restricted. 

The government has also been active in the implementation of several initiatives, including the Pradhan Mantri Mahila Shakti Kendra scheme, which aims to empower rural women via community involvement to create an environment where they may reach their full potential. Training of trainers of elected women representatives of Panchayati Raj is also conducted by the Ministry of Women and Child Development to discuss issues related to women’s empowerment and the functioning of PRIs, describe participatory planning processes in local governance, and enable women to identify their leadership potential to contribute effectively as change agents.

Restructured Panchayati Raj institutions 

The Cabinet Committee on Economic Affairs has recently given its approval for restructuring Rashtriya Gram Swaraj Abhiyan (RGSA)

The restructured scheme will have the following components:

  1. The program would apply to all Indian states and union territories, as well as rural local government entities in non-Part IX regions where Panchayats do not exist.
  2. The program will feature a central component – National level activities such as the “National Plan of Technical Assistance”, “Mission Mode Project on e-Panchayat”, and “Incentivization of Panchayats”, as well as a State Component – Panchayati Raj Institution (PRIs) Capacity Building”.
  3. The Government of India will completely fund the central component. However, for all states except the North East and the hill states, the Centre: State financing structure for the state component will be 60:40, with a 90:10 allocation for the North East and the hill states. The Central share will be 100% for all Union Territories (UTs) (with and without legislatures).
  4. The scheme’s implementation and monitoring would be mostly linked with the Sustainable Development Goals (SDGs), with a focus on Panchayats designated under Mission Antyodaya and 115 Aspirational Districts selected by NITI Aayog.
  5. The Scheme will bring together capacity-building programs from other ministries, with a special focus on ministries that will be significantly impacted by the Scheme. 

Impact on women with restructured Panchayati Raj Institutions

The said scheme of RGSA will give its major attention to Panchayati Raj Institutions (PRIs). It will help lakhs of PRIs to strengthen governance capacities to achieve the SDGs via inclusive local government and the most efficient use of available resources. PRIs achieving SDG goals will ultimately help to achieve gender equality, education, hygiene, sanitation, nutrition, etc. 

The scheme will help represent Scheduled Castes, Scheduled Tribes, and women as panchayats which will help women become politically powerful. Also, this scheme will help in strengthening panchayats, and gram sabhas would be strengthened to operate as effective institutions that promote the social inclusion of people, particularly disadvantaged groups, under the plan. It will provide an institutional structure with appropriate human resources and infrastructure for PRI capacity building at the national, state, and district levels. All these developments in PRIs will ultimately make women stronger. As the main focus of this scheme is on women and development then, the say of women’s words will be considered. 

Conclusion

Women’s political empowerment can begin with PRIs, since their confidence and grasp of the polity will enable them to vote in elections to state legislatures and Parliament, opening the route from “Panchayat to Parliament”. They can even get the confidence to take a stand for themselves, but it is only the start of a journey toward empowerment. Women’s empowerment requires more than local reservations and women’s involvement in Panchayati Raj institutions because the mindset that women are meant for households has still not changed, women are still not educated. Still, women are oppressed and are denied their rights and they face many more hurdles. But the PRIs are great initiatives to make women strong either politically, economically, or socially.

References 


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Drafting a Letter of Intent for Paralegal jobs : all one needs to know

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This article is written by Garima Gunjan, pursuing a Diploma in Advanced Contract Drafting, Negotiation, and Dispute Resolution from Lawsikho.

Introduction

The Letter of Intent (LoI) is a primary document through which one party declares officially to do business with another party. Its contents are similar to Term Sheets. It is based on the letter format.  Unlike agreements, LoIs are not legally binding to the involved parties. The particulars of LoI are described in a tabular format usually. It is ideally a document, which is specifically prepared for discussion purposes. Although they are not valid legally, LoIs also finds mentions of no-solicitation clauses and Non-Disclosure Agreements (NDAs). 

Purpose

The purpose of the LoI is to highlight the understanding that takes place between two or more parties regarding terms and conditions that they intend to finalize via this document. LoI protects the interests of all the parties who are involved in such a deal. Depending on the types of agreement that involved parties are going to sign, LoI is also used as a signal to indicate if these parties are going to sign deals such as joint ventures, property leases, or term sheets. Also, it can be referred to announce a kind of deal between two parties once they are done with negotiations. LoI is structured in such a way that the basic terms for the succeeding agreement are highlighted well before the involved parties start discussions in detail to finalize the important clauses and terms. Once prepared, LoI helps the parties to decide which terms they should consider important and start negotiations. 

Difference between LoI and cover letter

Although both Letter of Intent and cover letter (CL) consist of similar content, yet they serve different purposes. You can send LoI anytime but you are supposed to mail the cover letter only if you wish to apply for a specific position. The CL contains information specific to the job a paralegal wishes to apply for, whereas in an LoI, you also mention why you want to work under the specific Advocate. In an LoI, you enquire about potential or upcoming openings, but in a CL you mention every detail regarding a specific job posting. 

Paralegals

A paralegal is a legal professional who performs legal procedures under the guidance of a lawyer or attorney. They are required to assist legal professionals in matters related to litigation or consultative nature. Many law firms, consultancies, companies with law departments, organizations involved in public policy work hire paralegals to carry out legal work. Whether it’s environmental, corporate, intellectual property (IP) registration, property, tax, criminology, labour, civil, or any related matter, paralegals are always required by senior legal professionals to complete the required clerical works.  

According to the American Association for Paralegal Education (USA), the task of paralegals is to carry out ongoing and procedural legal work according to prevalent state laws, which otherwise qualified attorneys have to perform. Paralegals enhance their knowledge about laws prevalent in their jurisdiction through their studies, and practical legal work experiences. They are also required to follow legal & professional ethics compulsorily and adhere to workplace guidelines. 

A few of the legal tasks that paralegals are required to carry out include prepare interrogations, draft notices & contracts, prepare memos and carry out legal research, perform investigations, deal with bankruptcy and cheque bounce matters, assist in project management, carry out court filings, and perform other similar tasks as instructed by their seniors.  In many countries, including the United States of America (USA), the United Kingdom (UK), and India, paralegals can’t perform all forms of legal tasks unless they obtain their attorney or advocate license by clearing their respective Bar exam. In India, the term ‘paralegal’ is not widely used, but it has started catching up, mostly used as a substitute for ‘Legal Interns.’

Letter of Intent for Paralegal

Paralegals prepare LoI when they want to express their intention to the law firms or legal departments of companies they shall be applying to work, regarding the legal sector they wish to work in. For example, if a paralegal is interested in learning the nuances of Environmental Law, she will send an LoI to any law firm or a senior Advocate practicing in this sector. 

LoI drafted by a paralegal contains details regarding the intended action. In nature, this document is non-binding which means that the clauses of LoI can’t be enforced. 

Benefits of drafting LoI for a Paralegal

Once drafted well, an LoI can be an important tool for an Advocate to decide whether that Paralegal should be allowed to work under her or not. It also allows both the paralegal and advocate to figure out if they will be able to work together and if they agree on all points or not. LoI gives a chance to the paralegal and the hiring Advocate to negotiate on clauses they don’t agree on certain points such as stipend amount or work period.

The LoI also acts as proof of the legal skills that a paralegal possesses. Based on the information, one of the sides can even reject LoI or modify it after negotiations. Overall an LoI allows parties to save time and resources while a final offer of the ‘joining letter’ is made to the paralegal. 

How to draft a Letter of Intent for a Paralegal work?

Paralegals are required to draft the LoI when they are required to submit a job application or if they wish to know about the company they are going to work in. If you have a well-drafted LoI, chances are high that the potential employer has spotted you among the numerous applications and they will be going through your resume.  

Letter of Intent by a paralegal acts as a blueprint for the hiring Advocate through which the latter gets to know what the former would gain by working in his or her firm. It should contain a basic introduction of the paralegal, his purpose or intention behind drafting this LoI, educational details, legal skills, previous details of places he has worked at (along with duration and tasks performed), period for which he wants to work, desired stipend amount and contact details (phone no, email id and address for communication). Let’s see in detail what an ideal Letter of Intent drafted by a paralegal should look like:

Salutation 

Paralegals should prepare their LoIs informal business English. The Letter should be addressed to the required person using the prefix ‘Dear.’ In case you don’t know about the receipt, you can research about the same by going to the Company or law firm site’s ‘About Us’ section. 

Introduction

LoI’s first paragraph should contain the paralegal’s introduction. It should also include why the paralegal wishes to work for the company. Example of the same:

“Dear [Name], 

                I am writing to express my interest in a position within your Litigation team. I am a Paralegal with six months’ experience overseeing legal drafting works. I believe my skills will make me a valuable addition to your team. I’m a final year LLB student at ILS Law College, Pune with an interest in Corporate and IPR laws”

Your paralegal skills

As a paralegal, you should mention in detail what are your legal skills and how you can apply them to benefit the daily tasks of the law firm. Example:

“With my skills and qualifications, I am capable of providing paralegal services to protect your company’s innovation and intellectual property. While pursuing my LLB degree, I have gained knowledge of Intellectual Property Laws and Company Laws. As a member of my college’s Corporate Law cell, I was able to stay up to date on most of the legal current affairs. With my previous internship at a law firm, I successfully applied this knowledge and gained field experience.”

Specific accomplishments

Mention only relevant skills and publications (along with a link) in LoI. You can give an in-depth description of all your legal skills and publications in the CV. Also, mention your soft skills and technical skills along with the languages. You can also mention your volunteering details as long as it complements your legal skills. Example:

“During my internship at AZB & Partners, I performed the following tasks:

  • The drafted employment agreement, MoUs, and Franchisee Agreement
  • Assisted in due diligence
  • Prepared arguments for trials and assisted in case drafting” 

How your legal skills will be beneficial for the law firm?

In this part, explain how you can utilize your skills to assist in daily tasks. Research a bit about the law firm and try to link your skills to their expertise area, mission, or even working culture. For this part of LoI, you will have to do detailed research about the firm by visiting their blogs, client testimonials, Linked In, and news articles. For example:

“I recently read your blog on the knowledge-sharing program you are implementing within your commercial litigation team, and I believe my communication and collaboration skills will make me a valuable addition to the team.”

Contact details

Mention your email id, phone number along with residential address correctly so that the law firm can reach out to you while replying for your LoI. These details should be mentioned while you are ending the LoI. For example:

“Sincerely, 

Niti Singh,

Phone No: 910022861

Email ID: [email protected] 

Address: Flat-11, Shri Apartment, Viman Nagar, Pune-14.”

Sample LoI draft

Let’s see how a sample LoI draft may look like:

August 9, 2021

Reddy and Reddy Associates,

Shivajinagar, Pune,

Maharashtra- 411002

[email protected]

Dear Mrs. Navani,

I am writing to express my interest in a position within your Litigation team. I am a Paralegal with six months’ experience overseeing legal drafting works. I believe my skills will make me a valuable addition to your team. I’m a final year LLB student at ILS Law College, Pune with an interest in Corporate and IPR laws.

With my skills and qualifications, I am capable of providing paralegal services to protect your company’s innovation and intellectual property. While pursuing my LLB degree, I have gained knowledge of Intellectual Property Laws and Company Laws. As a member of my college’s Corporate Law cell, I was able to stay up to date on most of the legal current affairs. With my previous internship at a law firm, I successfully applied this knowledge and gained field experience.

During my internship at AZB & Partners, I performed the following tasks:

 The drafted employment agreement, MoUs, and Franchisee Agreement

Assisted in due diligence

Prepared arguments for trials and assisted in case drafting

I recently read your blog on the knowledge-sharing program you are implementing within your commercial litigation team, and I believe my communication and collaboration skills will make me a valuable addition to the team.

I have further attached my resume highlighting professional and academic excellence. I look forward to hearing you in due course. I appreciate your time and consideration. 

Sincerely, 

Niti Singh,

Phone No: 910022861

Email ID: [email protected] 

Address: Flat-11, Shri Apartment, Viman Nagar, Pune-14

Conclusion

An LoI should be drafted in such a manner that the Advocate should be compelled to read the paralegal’s resume. Its content should be direct and to the point. The main content of an LoI is the skills of a paralegal which should be backed with some experience. It is non-binding and helps the recruiter to decide if the paralegal is suitable for the job or not. 

References

  1. https://www.investopedia.com/terms/l/letterofintent.asp.
  2. https://www.legalmatch.com/law-library/article/letter-of-intent-lawyers.html.
  3. https://woman.thenest.com/difference-between-cover-letter-letter-interest-13867.html.
  4. https://www.wikijob.co.uk/content/application-advice/job-applications/how-write-letter-intent.

Students of  Lawsikho courses regularly produce writing assignments and work on practical exercises as a part of their coursework and develop themselves in real-life practical skills.

LawSikho has created a telegram group for exchanging legal knowledge, referrals, and various opportunities. You can click on this link and join:

Follow us on Instagram and subscribe to our YouTube channel for more amazing legal content.

 

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An overview of the GNCTD Amendment Bill, 2021

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This article is written by Komal Saloni, from Jamnalal Bajaj School of Legal Studies, Banasthali Vidyapith. This is an exhaustive article which deals with the introduction of the Government Of National Capital Territory Of Delhi amendment Bill, 2021. 

Introduction 

The Government Of National Capital Territory Of Delhi Act was enacted by the Congress government in 1991 and Delhi was announced as a union territory with limited ‘legislative powers’ assembly. However, the GNCTD (Amendment) Bill, 2021 interprets that the government in Delhi means Lieutenant Governor and elucidates that the Delhi government shall take the opinion of Lieutenant Governor before implementation of any action. 

The GNCTD (Amendment) Bill, 2021 will in effect make the ‘Lieutenant Governor’ the governor of the capital city. Nevertheless, when it comes to administrative power the elected government of Delhi that is also the Union Territory has more power to exercise. GNCTD (Amendment) Bill was passed by the Parliament to enhance the powers of the Delhi Lieutenant Governor. Among massive commotion and objection from the opposition members, it was passed by the Lok Sabha on March 22, 2021 (Monday), and from the Rajya Sabha on March 24, 2021 (Wednesday). After that the GNCTD (Amendment) Bill got assent from the President of India Ram Nath Kovind on March 28, 2021.

GNCTD Amendment Bill, 2021 

At the present, the administrative setup of Delhi falls under the Delhi government, whereas, law and order, and the police come under the Union Home Ministry. Amendment Bill, 2021 changed the course. Thus, the Lieutenant Governor will have more power to exercise than the Chief Minister. The Lieutenant Governor owns the power to send a bill to the centre or the President when clashing with the elected government of Delhi. According to Amendment Bill, 2021, the Delhi government has to send the legislative proposal to the Lieutenant Governor 14 days prior and in case of delay, the elected government is questionable.

Besides, there is a provision that says the Lieutenant Governor, in case of urgent matters, can take an immediate decision whether the matter is pending before the President. In 2018, the Supreme Court held that the government of Delhi need not be required to gain Lieutenant Governor’s acceptance on regular affairs of administration, however, it needs to inform the lieutenant governor’s office.

Thus, the Bill allows the Lieutenant Governor to act in confidentiality in matters related to the Anti-Corruption Bureau and the All India (Civil) Services, which is outside the purview of the Legislative Assembly of Delhi. The validity of any decision taken indiscretion set-up by the Lieutenant Governor shall not be questioned. Once the Bill becomes Act, it must be binding on the Delhi government to take the viewpoint of the LG before any executive action. The Amendment Bill grants more power to the Lieutenant Governor in comparison to the elected government in Delhi. 

The NCT Bill obtained the assent of the President that expressing ‘government’ in Delhi means ‘LG’

The Bill is passed in both the houses and also passed by the President, Ram Nath Kovind, assent now accords primacy to Delhi’s LG over the elected government of Delhi.

According to the codification, the power exercises are in the hands of LG. Here the government in Delhi means the lieutenant governor and the elected government has to seek the opinion of the Lieutenant Governor before moving for any action in Delhi. 

Parliament passed the Bill in March – Lok Sabha on 22 March and Rajya Sabha on 24 March.

Elucidating the logic behind the Bill, Union Minister G Kishan Reddy said that the amendments were put forward to remove inconclusiveness in the existing Act. That changed, running in the law has been yelled in the soul of what has been held in the Supreme Court judgment and continued that there is no political angle and the amendments are on practical grounds. “The introduced bill doesn’t diminish any power entertained by the government of the National Capital Territory of  Delhi that is previously  provided by the Constitution of India.”

The Aam Aadmi Party said that it was intentional to approach the Supreme Court as opposed to the legislation, declaring that an unconstitutional attempt had been made, to make the Delhi government ‘administratively inadequate’ by the political party.

The Aam Aadmi Party opposed the proposed amendment through a simple Amendment Bill. It was declared that because Delhi has been honoured with a special status as per Article 239AA of the Constitution of India. Any change in the power of the Delhi government ought to be by way of Constitutional Amendments only. 

Need for the Bill

Some of the needs of the bill are raised by the Union Minister G Kishan Reddy :

  • The GNCTD (Amendment) Bill,  2021 is necessary to reduce the vagueness in certain issues allied to the functioning of the Delhi government. 
  • Certain cases related to the functioning of the Delhi government were filed in courts. 
  • Lieutenant Governor is an administrator thus has the right to know the daily affairs. 
  • Amendment in Act creates soundness in the government mechanism in NCT of Delhi.
  • It will improve equality and extensiveness. 
  • Amendment leads to transparency in governance and amplifies public responsibilities.

Objective and scope 

  • In the present administrative set-up of Delhi, administrative affairs fall below the Delhi government, whereas, law and order, the police come under the Union home ministry. 
  • As per the ruling of the Supreme Court, Amendment Bill 2021 aims to demonstrate the power of the Chief Minister as well as the Lieutenant Governor. However, the lieutenant governor will have more power to exercise than the chief minister.
  • The L-G owns the power to send a bill to the Centre or President when clashing with the elected government of Delhi. 
  • According to Amendment Bill, 2021 the Delhi government has to send the legislative proposal to the lieutenant governor 14 days prior, and for delay the elected government is questionable.
  • Besides, there is a provision that says the lieutenant governor in case of urgent matters can take an immediate decision whether the matter is pending before the president. 
  • In 2018 the Supreme Court held that the government of Delhi need not be required to gain L-G’s acceptance on regular affairs of administration; however, it needs to inform the lieutenant governor’s office.
  • Thus, the Bill commonly known as NCT Bill authorizes the Lieutenant Governor to act in confidentiality in matters related to the Anti-Corruption Bureau and the All India (Civil) Services, which is outside the purview of the Legislative Assembly of Delhi. 
  • The validity of any decision taken indiscretion by the lieutenant governor shall not be questioned. 
  • Once the Bill becomes Act, it must be binding on the Delhi government to take the viewpoint of the L-G before any executive action.
  • The Amendment Bill grants more power to the Lieutenant Governor in comparison to the elected government in Delhi. 

Important provisions                   

This Article is added to set up an elected government in the union territory to pave the way towards the democratic setup and a representative form of government, accordingly, the majority have the right to personify their opinion in policies and law belonging to NCT of Delhi concerning the limitation imposed by the constitution of India. 

It is important to give a purposive interpretation to Article 239AA that the principle of federalism and democracy which are part of the basic structure of the Constitution must be reinforced in Delhi in their truest sense. 

  • Article 239AA(1): By the Sixty-Ninth Amendment Act 1991, union territory Delhi shall be called the national capital territory of Delhi and the constitutional governor designated as an administrator shall be appointed under Article 239 of the Constitution. 
  • Art. 239 AA(3): According to the provision, the legislative assembly shall have the power to make laws for the national capital territory of Delhi concerning the matter listed under concurrent and state list as so far the matter is concerned with the union territory of Delhi except matters concerning entries 1, 2 and 18 of the State List and entries 64, 65 and 66 of that list before related with entries  1,2, and 18.  

(b) notwithstanding anything in sub-clause (a) shall diminish the power of the parliament to make laws concerning any matter related to union territory.

  • Article 239 AA (4) – Provision: In case of any differences of opinion on any matter between Lieutenant Governor and Ministers, the Lieutenant Governor shall mention it to the President for deciding on the matter.
  • Article 239AA(3)(a) and Article239AA(4) – This shows that the executive power of the government of NCT Delhi is co-existent and extensive with the legislative power of the Delhi Legislative Assembly. 

GNCT of Delhi v. Union of India & Anr. (commonly known as Delhi v. LG case)

In the Delhi v. The LG, (2018) was held by the Supreme Court that the Lieutenant Governor is an administrative head only in a limited sense and is bound by the aid and advice of the council of ministers of the Delhi government, excluding in the matters of land, police, and public order. 

It was alleged by the elected government of Delhi that the bill is an attempt towards the interpretation of the Constitutional Bench. By declaring the lieutenant governor the government of Delhi, the bill seeks permission to enhance the power of the Lieutenant governor and demolish the power of the elected government.

The future of the NCT Delhi 

The Aam Aadmi Party government led by Arvind Kejriwal said that; the passing of the GNCTD amendment Bill in both houses is an insult to the Delhi people. The bill gives the power to the BJP government and takes away the power from the elected government of Delhi who was voted by the people. A setback to the Aam Aadmi Party who had been calling for full statehood for Delhi, which is also supported by the BJP government too in 2014. Kejriwal has a long history of running in Delhi with the Lieutenant Governor.

The Aam Aadmi Party has been opposing the Bill since the Bharatiya Janata Party (BJP) said it will present it in the Lower House of Parliament. AAP had protested on the 17th of March at Jantar Mantar to oppose the centre’s move. Delhi Chief Minister Arvind Kejriwal, leading the protests, blamed the BJP for running the Delhi government by power. 

Then a few questions were raised by Kejriwal: What transpired the people of Delhi? What materialized the Chief Minister? Why were the elections held?

How relevant is federalism under the GNCTD Bill?

On March 25, 2021, Member of Rajya Sabha  Dr Abhishek Manu Singhvi disagreed with the Govt. of National Capital Territory of Delhi (Amendment) Bill 2021, addressing the Bill to be “the most destructive & unconstitutional Bill Rajya Sabha has ever accepted”.

This Bill has restored the earlier but significant argument on Federalism. 

One of the significant features of the Indian Constitution is that, like many other western states, it demonstrates the structure of federalism. For a long time, the precise nature of India’s Federation of states has been a matter of dispute. 

The amenities and conflicts concerning the Government of NCT of Delhi & the Union Government, arising because of disputes related to the jurisdiction of the Government of NCT Delhi Art. 239AA and the Union government and its representative, Lieutenant Governor under Art. 239. The coexistence of these provisions conflict with the power of the Government of Delhi and the Lieutenant Governor.

According to the Union government, given that New Delhi is a Union Territory – Article 239 of the Constitution of India empowers the Lieutenant Governor to act autonomously with his council of ministers. Nevertheless, the elected government of Delhi, proclaimed that Article 239AA of the Constitution of India grants Delhi a unique status as a legislatively elected administrator. This creates a power struggle between the state government’s Lieutenant Governor and Administrative powers in the NCT of Delhi. 

In, Govt. Of NCT Of Delhi v. Union of India (2018), it was held by the five-judge Bench that the approval of Lieutenant Governor is not needed on issues other than public order, police, and land. Further, the Court added that the council of ministers’ decision, however, be communicated to the Lieutenant Governor and the LG was bound before the aid and advice of the council of ministers. The Court also held that the status of LG of Delhi is not the same as the Governor of state. Preferably, Lieutenant Governor remains an administrator with “limited power”. Court pointed out that the elected government must acknowledge that Delhi is not a state.

However the NCT of Delhi (Amendment) Bill 2021, therefore passed to make it compulsory to the Government of Delhi to take the consideration of the Lieutenant Governor before any decision-making actions. Additionally, the Lieutenant Governor has been made similar to the government. As well, this provides LG extensive power to mention all the matters to the president. These amendments are inherently in violation of the Govt. Of NCT of Delhi vs Union of India, 2018 Judgement is also offensive to the Doctrine of Pith & Substance.

The Apex Court had to take the edge of the current argument to permanently resolve the jurisdiction. India will only be booming and wealthy if all of its states also do. The sound substructure of federalism and democracy on which our country has prospered will begin to disintegrate if there is dissension or conflict between the Centre and the states.

The doctrine of Pith & Substance

The factual meaning of the “doctrine of pith and substance is the essence and true character of an enactment.

  • Pith: “True character” or “essence of something”.
  • Substance: “sine qua non-elements of something” or “an essential part of something”.

Accordingly, the doctrine completely can be entertained as the sine qua non-element of something in which its bona fide essence falls.  

The doctrine is used in cases predominantly to decide the capacity of the legislature to validate laws according to Article 246 on subject affairs enlisted in three lists under Seventh Schedule which strongly outlines a distinction between the power of Centre and State legislatures to formulate laws on definite subject matters. Alongside, the doctrine helps to resolve the issues of abhorrence that appear because of discrepancies in laws formed by the parliament and the state assembly under Article 254 of the Constitution of India. Presuming, there is a dispute between the three lists. The list – l always prevails, running above the other two lists and list III will prevail above List II. Assuming the repulsiveness of laws formed by both the legislatures undergoing List III, the law created by the Union legislature would conquer. Additionally, in a direction to regulate the legality of an enactment, the standard of encroachment or invasion must be considered. The legislation would be declared reasonable if the encroachment is ancillary or incidental. Whether the invasion transpires to be substantial, the enactment will depict invalid.

Conclusion 

Hence, the Government of National Capital Territory of Delhi (Amendment) Bill, 2021, increases the powers of the LG, who appears for the Centre, in correspondence to the national capital’s elected government. This BiIl when it became an Act shall be mandatory for Delhi’s elected government to consult as well as being answerable to the Lieutenant Governor. According to the Bill, LG has an inherent power to exercise. It will loosen up the Delhi government to work accordingly.

References


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Here’s how you can draft the T&Cs of an Ed-Tech website

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Image source: https://blog.ipleaders.in/draft-contracts-efficiently/

This article is written by Dhriti Hundia, pursuing a Diploma in Advanced Contract Drafting, Negotiation, and Dispute Resolution from Lawsikho.

Introduction

You are in the process of building a beautiful website for your ed-tech business when the developer asks for your Terms and Conditions. Up until now, this hasn’t even crossed your mind. Isn’t that just legal mumbo jumbo at the bottom of websites? Does anyone even read it? You’re just a small business, do you really need to create a Terms and Conditions page for your website? The answer to that question is: definitely, yes! 

While it’s not mandatory under any law to have a Terms and Conditions page drew up for your business, (unless we’re talking about a privacy policy) it is the smart thing to do.  These pages can limit your liability if a customer/third party sues you and takes you to court, possibly preventing your company from draining huge amounts of resources on litigation at that time. It also helps establish ownership over the website, protect your intellectual property and enforce rules. The Terms & Conditions (T&C) of a website are also known as Terms of Service or Terms of Use. This article and outline will guide you on drafting a simple yet complete set of terms and conditions for your ed-tech website. We will cover all the important clauses your terms and conditions must include. 

Writing the terms & conditions

Once you decide your purpose and figure out the priorities for the terms and conditions, it’s time to start drafting them. Most Terms and Conditions of Edu-tech websites will contain the following clauses and sections. Make sure you incorporate them. 

  • Introduction and acceptance of the T&C

All the effort put into the drafting of the agreement is worthless, unless your user accepts them. Most websites ask users to accept the T&C when they sign up or log in. It can also be done by making the users tick an “I agree” checkbox. 

This example from Instagram illustrates how users agree to accept their terms and conditions and policies when they sign up as users. 

However, this is not enough on its own, one still needs to give their acceptance to the terms. This can be done by adding a statement in your introduction saying, “Use of our services in any manner shall constitute your acceptance of our Terms and Conditions.”

Pinterest also takes a similar approach using user-friendly language:

 

 

 

 

 

Doing this will form the basis of enforcing your Terms and Conditions.

  • Privacy policy 

If you are collecting any sort of personal information like email address, phone number, credit card details, then you’ll have to draft a privacy policy. The policy will govern how the information collected by your website will be used or not used. 

This is the only part of the Terms and Conditions that is legally required. It is a mandatory requirement in Australia, Canada, Europe as well as the state of California in the U.S. 

It is a better safe than the sorry situation, which is why most websites that collect only basic information like name and birthdate will still ensure they have a privacy policy in place. 

Privacy as a clause is also mentioned separately in the terms and conditions. Describing how you store and utilize your user’s data ensures transparency on your part and also protects you from any kind of liability. 

Look at Yahoo’s privacy policy for a good example!

But if you are drafting your own privacy policy, a simple yet effective approach would be like the one Car2go has, check it out below. 

  • Limitation of Liability 

You’ll need a basic disclaimer that protects you from any sort of liability from errors on your website or its content. 

A limitation of liability clause stipulates that a party will be obligated to pay the other in such an event under the terms of an agreement. This clause limits the amount as well as the types of damages a party can recover from the other. Without such a clause, users could possibly sue you for viruses, shutdowns, failure of the app/website, etc.

Even if you don’t anticipate any of this going wrong, it’s better to have such a disclaimer in place absolving you of liability, as generally, it is the things you did not foresee happening that have the potential to hurt you the most and land you in legal trouble. 

This is a sample clause that BYJU’s has in its T&C, which tells its users that they will not be held responsible for any sort of information on their website. They also have a clause stating, “The Company shall have no responsibility for any loss or damage caused to tablet or any other hardware and/or software and/or instrument, including loss of data or effect on the processing speed, resulting from Your use of our products and Services. 

As an ed-tech website, you will be providing your customers with a lot of information that may come from third parties. Therefore, it is pertinent to have a specialized limitation of liability addressing your concerns and issues, even if you feel that it is not really needed. 

  • Intellectual Property Rights

Irrespective of what your website does, you should always include a notice about copyright and trademark. For eg, “Copyright © 2015. yourwebsite.com.”

Now for ed-tech websites in specific, you provide your students with a lot of course material, video lectures, and documents. To make sure that it remains proprietary to you and does not get copied, it is essential to have an intellectual property section in your terms and conditions. 

Using someone else’s intellectual property without their permission or a license is actionable under the law. If a user does so, it gives you the ability to file an infringement or violation claim against him/her, and also terminate their access to your website and services in the future. 

A general statement like the one of Coursera covers most of your liability. 


However, in case of high-risk mitigation, consider adding a more detailed clause like the one of MasterClass.

  • Payment terms 

Including payment terms in your T&C allows you to terminate access in case of non-payment and puts customers on notice that you require their payment information, especially if you are functioning as a subscription or annual or quarterly installments-based model. 

This section does not have to include the payment amounts, as this will vary depending on the course, and you will most likely have a separate page for it.

The payment terms can explain how and when the payment is to be made, and what happens in case a refund is needed (if you offer it).

Below is a sample clause from LawSikho’s website relating to payments. 

If you offer a free trial, and the customer is charged after it ends, discuss that too. List the acceptable methods of payment in the least. 

  • Termination

This clause will deal with your ability to control the Terms and Conditions. It may be a stand-alone clause or contain certain violations that may lead to termination. BYJU has a general statement for termination which is sufficient.

However, the trend nowadays is to write a more detailed clause on termination, stating your own list of violations that may result in termination. Look at Coursera’s policy below as an example.

 

 

A general payment statement is sufficient, especially when are you are new. You can make it specific and change it as and as you grow to suit the business model. 

  • Notification of changes 

It’s a good idea to inform the users or notify them if any changes occur in the terms of use of the website. Because as time passes and you learn more about the market, there will be changes in your T&C. 

You can decide to change the amount of time the students will have access to the course material after the duration of the course. Will there be lifetime access to video recordings or not? 

These are things that might change, and therefore a flexible policy to make changes should be adopted and mentioned. 

This is BYJU’s sample clause – it gives them the power to decide changes at their own discretion. 

  • Set Governing Law

Your Terms and Conditions should also mention where your website is operating from in terms of the governing law (state/province and country).

For example, “These terms and conditions are governed by the laws of the United States of America and the laws of the State of California.”

Conclusion

The T&C is considered a dense document which is usually difficult to navigate, but slowly that narrative is changing and we see increasingly simple yet effective language being used, summary notes being provided along with it to make it more understandable. This can also be helpful in a courtroom, as interpretation becomes easier. Vaguely worded documents are frowned up and can be used against you.  Although it may seem quite overwhelming to create the document, it really isn’t.  

Just be smart about it and remember:

  1. Do not copy the T&C – this may be the easier way out, but just don’t do it. if you do copy another business T&C, you will not be able to protect yourself in court. 
  2. Enlist an attorney – hire a lawyer draft or at least review the T&C to meet the specific needs of your business

In my opinion, even a small-scale ed-tech business should consider getting an attorney as they transact business, collect personal information and have interaction on the website. Also, special rules apply for dealing with students who are minors and you’ll want to make sure you are compliant with the law and your website reflects this.

Chances are that no one will ever read your Terms and Conditions, but they will certainly come in handy should any issues arise.

Sample draft of an Ed-tech Agreement

  • EDUCATIONAL SERVICES AGREEMENT 

Between ______________________ and the ___________(ed-tech platform)

This Agreement is made this _________day of __________________, 20____ by and between _______________________________________________________________ a company headquartered at ___________________________________________ (hereinafter “Provider”), and the Ed-tech platform (MCCS), headquartered at 101 N. 14th Street, Napensee Road, Mumbai 400013 , collectively “the Parties.”

  • Terms and Conditions: 

NOW, THEREFORE, in consideration of the mutual promises herein contained, the Parties agree as follows:

  1. Provider to Offer Course(s), ______ will create, establish, and provide instructional content for the course(s), (the “Course(s)”), more fully described on Addendum A, attached hereto and incorporated herein, in accordance with the needs of the users. The Course(s) will be offered to students at the ______ website. 
  2. Non-discrimination and ADA. The provider does not unlawfully discriminate against any person because of sex, race, disability, national origin, veteran status, religion, or creed. Provider agrees to comply with all applicable federal and state laws, rules, regulations, and executive orders relating to non-discrimination, affirmative action, and equal opportunity 
  3. General Terms

Users of our services agree to not get engaged in any of the activities that; i) involves copying, distributing, or disclosing any part _______ services to any third party; ii) materially disrupts or abuses any aspect of the network, security system, or website; iii) includes uploading inappropriate data, virus, worms or any other unwanted software agent through the services; iv) generates or facilitates unsolicited or unauthorized advertising or marketing communications including but not limited to spams; v) involves collecting any personally identifiable information to another third party; vi) violates or facilitates the violation of the legal rights of others vii) interferes with the proper working of the service; 

You agree not to access or attempt to access the services by any means other than the interface provided by us. You will not use the services for fraudulent or illegal purposes including the storage or transmission of content infringing the intellectual property rights of others, or to communicate any message or material that is deemed harassing, indecent, obscene, or otherwise unlawful.

You agree to follow the best practices as recommended by _______ for getting good performance from the platform.

  1. User consent – These Terms, which include our Privacy Policy, are a binding legal agreement and govern your use of the Platform, including all features and functionalities, applications, updates, notifications, and our user interfaces, and all content and software associated therewith. By checking the “I accept the Terms & Conditions” box during the registration or by downloading the Chrome extension, using, visiting, or browsing an account on the Site, you accept and agree to be bound by the current version of these Terms. If you do not agree to these Terms, you are not authorized to use them, and you should not use the Platform.

Please note that these Terms may change from time to time. We will post any changes to our Terms on the Platform and our website and, if the changes are material, we will provide a more prominent notice (such as email notification). When we update the Terms, we will note the 

  1. Privacy Policy – You consent to us collecting your personal information to provide you with our service(s) to which you are signing up, and to communicate with you via email or SMS regarding our services, promotion and for the purposes set out in this Privacy Policy.

You also consent to us providing your information to our Partners for e.g. Moodle, Amazon, Microsoft in situations we are bound by partner agreements to share basic sales & customers information for their auditing and reporting purposes.

You consent to us collecting data regarding your use and your user’s use of the Websites. We use this information to guide improvements to our services.

  1. Collection and use of personal information- The main aim in collecting information about you is to provide our services and tailor-fit them for you. Moreover, there are several other objectives in the usage of your personal information which includes (but are not limited to),
  • Service: To provide you with and improve our services and manage payments related to that service;
  • Contact: To contact and communicate with you;
  • Research and development: To collect, analyze and report on data for evidence-based improvements, for future developments of our Website, related services, and our platform;
  • Marketing including direct marketing: To communicate with you about updates to our products and services;
  • Authentication and security: To authenticate users and conduct session management;
  • Support services: To provide you with information and support services;
  • Service maintenance: To analyze data to inform improved and enhanced services and customer relations;
  • Data analytics: For data analytic purposes;
  • Personalization: Guarantee that the contents in the website are presented in the most effective manner for you and your computer system, customize the content and advertising you see, provide you with additional information we think is of interest to you; 
  • Maintaining account and your personal identity: Where we collect your personal or usage information for a specific purpose not outlined above, we may provide you with a collection notice which explains the primary purpose and any related secondary purposes for which we are collecting and using your personal information.

Students of Lawsikho courses regularly produce writing assignments and work on practical exercises as a part of their coursework and develop themselves in real-life practical skills.

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An analysis of adoption under the Juvenile Justice (Care and Protection of Children) Act, 2015

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Juvenile-Justice
Image source - https://bit.ly/2WIUMN1

This article is written by Astitva Kumar, a student at JIMS, School of Law (An Affiliate of Guru Gobind Singh Indraprastha University). This article deals with an analysis of adoption under the Juvenile Justice (Care and Protection of Children) Act, 2015. 

Introduction 

There is no trust more sacred than the one the world holds with children. There is no duty more important than ensuring that their rights are respected, that their welfare is protected, that their lives are free from fear and want, and that they can grow up in peace.”

-Kofi Annan

Close to half of the world’s population is made up of children. They are humankind’s future and the nation’s greatest asset. They are both inheritors of the past and forerunners of the future. They have the right to be children and grow up. Children, on the other hand, who are unaware of their rights, become victims of abuse or delinquent behavior. In 1986, the Juvenile Justice Act was enacted for the first time to safeguard juveniles.

The Juvenile Justice (Care and Protection of Children) Act, 2015 was passed by the Indian Parliament amid heated debates, lengthy discussions, and street protests by child rights organizations and even certain members of Parliament.

It replaced the Juvenile Justice (Care and Protection of Children) Act, 2000, in India, and allows juveniles in conflict with the law between the ages of 16 and 18 who are involved in heinous crimes to be tried as adults. The Act also intended to create a universally accessible adoption law for India, overtaking but not replacing the Hindu Adoptions and Maintenance Act, 1956 (applicable to Hindus, Buddhists, Jains, and Sikhs) and the Guardians and Wards Act, 1890 (applicable to Muslims). The Act went into effect on January 15, 2016. The Lok Sabha passed it on May 7, 2015, despite strong opposition from some Members of Parliament and the Rajya Sabha passed it on December 22, 2015.

The Juvenile Justice (Care and Protection of Children) Act, 2015

The Juvenile Justice (Care and Protection of Children) Act of 2015 refers to children in conflict with the law as well as children who demand care and protection. It, in particular, offers a complete framework for domestic and international adoption of orphans, abandoned children, and surrendered children. Adoption is a legal procedure in which a child legally becomes the lawful child of his adopted parents and is therefore permanently separated from his birth parents.

Brief history

The Apprentice Act of 1850 was the first piece of juvenile justice law in India, requiring that adolescents aged 10 to 18 who were convicted in Court receive vocational training as part of their rehabilitation process. The Reformatory Schools Act of 1897, the Indian Jail Committee, and, subsequently, the Children Act of 1960 all replicated this Act. The National Children’s Act, 1960, was the first proper action by the government of India in the injustice of children. This Act was later superseded by the Juvenile Justice Act of 1986. India adopted the United Nations Convention on the Rights of the Child (UNCRC) in 1992. To conform to the Convention’s norms, the 1986 statute was repealed and the JJ Act, 2000 was enacted. The JJ Act of 2000 addressed two types of children: “child in dispute with the law” and “child in need of care and protection.” The aforementioned Act was amended from time to time to include new Sections and concepts about children.

Importance

The Juvenile Justice Act is indeed a significant piece of legislation. There was no universal statute dealing with the subject of the care and protection of adolescents or children before the enactment of this legislation. Every state had its own set of laws governing children, and these laws varied greatly. The intended target groups of these laws were also diverse, as definitions diversify substantially and there was no national uniformity. The definition of a child differed from one state to the next. 

The Supreme Court emphasized the importance of having similar rules for children across India’s territory in a landmark case, Sheela Barse v. Union of India (1986). The Supreme Court went on to say, “The Act so enacted by Parliament should include not only have  provisions for investigating and prosecuting offenses against children under the age of 16, but should also have mandatory provisions for ensuring social, economic, and psychological rehabilitation of children who are either accused of offenses or abandoned, destitute, or lost.” Furthermore, the Court emphasized the importance of children, adding, “the best recompense the State may get for expenditure on children is the development of powerful human resources ready to assume its position in the nation’s upward march.” 

As one can see, the significance of this specific piece of legislation is multifaceted because it deals with children, who are, after all, the nation’s future. It also brought with its consistency in dealing with difficulties and with children. It should also be noted that this piece of law aided India in honoring its obligations and upholding the numerous international treaties or sanctions agreed, including those of the United Nations

Theories on child behavior

Two views that may aid in understanding the causes of juvenile delinquent conduct:

Psychodynamic theory

Sigmund Freud established the Psychodynamic Theory, which claims that a child is born with animal instincts and that the ego is the realization of real life. Interaction with parents fosters the development of the superego. However, if a youngster does not receive such direction, the ego and superego are unable to regulate the animal impulse, and the juvenile becomes a criminal.  

Social Learning theory

It argues that a child is good when he or she is born, but the environment changes his or her nature because the youngster learns by emulating elders.

In both circumstances, however, the role of parents, society, and the environment is critical. Many neuroscientists agreed that the human brain’s prefrontal lobe, which is responsible for planning, reasoning, judgment, and impulse control, does not develop until the age of twenty-five. Delinquency can also be caused by the environment in which a youngster lives.

Objective and scope 

Objectives of the Act

Justice V.K. Krishna Iyer, a former Chief Justice of India, once said that we need a penal code since the child is the father of a man, and if we disregard the underdevelopment of children, we will be guilty of many flaws and errors linked to abandoning our children. 

On December 16, 2012, the terrifying “Nirbhaya Delhi Gang Rape Case” stunned the entire nation, sparking numerous arguments among the legal community and socialists. The main reason for the dispute was the involvement of the accused, who was only six months away from reaching the age of 18. The accused’s involvement in such a horrible crime of rape compelled the Indian Legislation to enact new legislation, and thus the Indian Parliament enacted the “Juvenile Justice (Care and Protection) Act, 2015.” It went into effect on January 15, 2016.

The Juvenile Justice Act of 2015 replaced the Juvenile Justice (Care and Protection of Children) Act of 2000, allowing juveniles in conflict with the law who commit heinous offenses to be tried as adults.

The Juvenile Justice (Care and Protection of Children) Act, 2015 has the following objectives:

  1. The Act provides the basic principles for delivering justice to a juvenile or child.
  2. To make the juvenile justice system, which is intended for children, more sensitive to developmental requirements in comparison to the criminal justice system, which is intended for adults.
  3. To bring juvenile legislation into line with the United Nations Convention on the Rights of the Child.
  4. To set a uniform age of eighteen for both males and females.
  5. To guarantee that cases involving juveniles or children are dealt with as quickly as possible by the authorities envisioned by this Act, within a time restriction of four months, as established in Article 21 of the Indian Constitution.
  6. To define the State’s functions as a facilitator rather than a doer by involving voluntary organizations and local governments in the execution of proposed legislation.
  7. Through sensitization and training of police employees, specific juvenile police units with a humanitarian attitude will be established.
  8. To make juveniles and children more accessible by establishing Juvenile Justice Boards, Child Welfare Committees, and Homes in each area or set of districts.
  9. To reduce stigma and to accommodate the developmental needs of the juvenile or child, the Act should be divided into two sections, one for juveniles in violation of the law and the other for the juvenile or child in need of care and protection.
  10. To provide adequate measures and numerous choices for rehabilitation and social reintegration of abandoned, poor, neglected, and delinquent juvenile and child offenders, such as adoption, foster care, sponsorship, and aftercare.
  11. To allow juveniles between the ages of 16 and 18 to be tried as adults for heinous crimes.

Scope of the Act

  1. The Act allows teenagers between the ages of 16 and 18 to be tried as adults for severe crimes.
  2. Anyone between the ages of 16 and 18 who commits a less serious offense may be tried as an adult only if he is captured after the age of 21.
  3. In each district, Juvenile Justice Boards (JJB) and Child Welfare Committees (CWC) will be formed.
  4. The JJB will undertake an initial investigation to decide whether a juvenile offender should be sent for rehabilitation or tried as an adult.
  5. The Convention on the Rights of the Child (CWC) will determine institutional care for children in need of care and protection.
  6. The Act includes provisions regarding adoptive parents’ eligibility and the adoption procedure.
  7. Penalties for cruelty to a child, providing a narcotic substance to a youngster, and kidnapping or selling a child.

Categories of Juvenile or Children Act deals

The Juvenile Justice (Care and Protection of Children) Act, 2015 addresses three sorts of juvenile or child issues:

  1. Juvenile in conflict with the law;
  2. Child in need of care and protection; and
  3. Rehabilitation and social reintegration of a child.

Major provisions 

  1. To remove the negative connotation associated with the word “juvenile,” the Act’s nomenclature was changed from “juvenile” to “child” or “child in conflict with the law.”
  2. Several additional definitions were added, including orphaned, abandoned, and surrendered children, as well as small, serious, and heinous crimes committed by children.
  3. The clarity in the powers, functions, and responsibilities of the Juvenile Justice Board (JJB) and the Child Welfare Committee (CWC); precise timelines for Juvenile Justice Board (JJB) inquiries; The Act requires that Juvenile Justice Boards and Child Welfare Committees be established in each district. Each must have at least one female member.
  4. Special measures for children over the age of 16 who commit heinous crimes – Specific measures have been developed under Section 15 to deal with child offenders aged 16 to 18 who commit serious crimes. After conducting the preliminary assessment, the Juvenile Justice Board has the option of transferring cases of severe crime by such minors to a Children’s Court (Court of Session). The regulations provide for children to be placed in a “safe place” both during and after the trial until they reach the age of 21, at which point the Children’s Court will evaluate the youngster. After the evaluation, the youngster is either freed on probation or sent to jail for the remainder of the sentence if he or she has not reformed. The law will serve as a deterrent to minor offenders who commit horrible crimes like rape and murder, while also protecting the victim’s rights.
  5. A new chapter on adoption has been included to help in the adoption of orphaned, abandoned, and surrendered children. The current Central Adoption Resource Authority (CARA) has been given the status of a statutory entity to enable it to fulfill its duty more effectively to streamline adoption procedures for orphaned, abandoned, and surrendered children. 
  6. A completely separate chapter (VIII) on adoption contains extensive requirements on adoption as well as penalties for failing to follow the procedure. Timelines for both in-country and inter-country adoption have been shortened, including declaring a child legally free for adoption. A single or divorced individual can adopt under the conditions, but a single male cannot adopt a girl child.
  7. Inclusion of new offenses against children – The Act includes several new offenses against children that have yet to be fully addressed by any previous law. These include the following: 
  1. Sale and procurement of children for whatever purpose, including unlawful adoption, and corporal punishment in child care institutions.
  2. Child use by militant groups.
  3. Offenses targeting children with disabilities and kidnapping and abduction.
  1. Penalties have been imposed for a child’s abuse, offering a youngster a drug, and kidnapping or selling a youngster. Any officer who does not report an abandoned or orphaned child in 24 hours shall be liable for up to 6 months in prison or a Rs. 10,000 fine, or both. The penalty for non-registration is a prison term of up to 1 year or a fine of 1 lakh or both. The punishment for administering liquor, narcotics, or psychotropic drugs to a child shall be imprisonment for up to seven years or one lake or the other.
  2. Registration of child care institutions – Any institution which, wholly or partially, receives subsidies from the government or which is run by the State Government or by a non-governmental organization is to be mandatorily registered under the Act within 6 months from the date of the Act, irrespective of whether it is to be received. Child care institutions must be registered by law. In cases of non-compliance, astringent punishment is provided.
  3. For children in conflict with the law and who need care and protection, certain rehabilitative and social re-integration procedures were introduced. Children in institutional care receive different services to enable them to play a productive part in society, such as education, health, nutrition, de-addiction, disease treatment, professional training, skill development, life education, counseling, etc. Among the non-institutional options are sponsorship and foster care including group foster care for placing children in a family environment that is other than the child’s biological family, which is to be selected, qualified, approved, and supervised for providing care to children.

Important definitions under the Act

Below are some of the important definitions mentioned under Section 2 of the Act. 

Abandoned child [Section 2(1)]

It refers to a child who has been abandoned by his birth or adoptive parents or guardians and has been pronounced abandoned by the Committee after a thorough investigation.

Adoption [Section 2 (2)]

It refers to the procedure by which an adopted kid is permanently separated from his biological parents and becomes a lawful child of his adoptive parents, with all of the rights, benefits, and duties that a biological child enjoys. 

Adoption regulations [Section 2 (3)]

It refers to the adoption regulations drafted by the Authority and published by the Central Government.

Authorized foreign adoption agency [Section 2 (6)]

It means a foreign social or child welfare agency authorized by the Central Adoption Resource Authority on the recommendation of their Central Authority or a Government department of that country to sponsor the application of a non-resident Indian or overseas citizen of India, or a person of Indian origin, or a foreign prospective adoptive parent for the adoption of a child from India. 

Authority [Section 2 (7)]

This means the Central Adoption Resource Authority is constituted under Section 68.

Child [Section 2 (12)]

 It means a person who has not completed eighteen years of age.

Child in conflict with the law [Section 2(13)]

It means a child who is alleged or found to have committed an offense and who has not completed eighteen years of age on the date of commission of such offense.

Foster family [Section 2 (30)]

This means a family found suitable by the District Child Protection Unit to keep children in foster care under Section 44.

Heinous offenses [Section 2 (33)]

Includes the offenses for which the minimum punishment under the Indian Penal Code or any other law for the time being in force is imprisonment for seven years or more.

Juvenile [Section 2 (35)]

Means a child below the age of eighteen years.

Orphan [Section 2 (42)

Means a child— 

  1. Who is without biological or adoptive parents or legal guardian; or 
  2. Whose legal guardian is not willing to take, or capable of taking care of the child.

Adoption under the  Act of 2015 

Meaning of adoption

Adoption is the legal act of permanently placing a child with a parent or parents other than the biological parents. Adoption results in the severing of the parental responsibilities and rights of the parents and the placing of those responsibilities and rights onto the adoptive parents. It is a worldwide institution. Almost all religions and mythologies contain some reference or other to adoption. In the contemporary world, the thirst for the concept of adoption has changed from providing a child to childless to providing a home to the homeless.

Whole Chapter VIII has been dedicated, this deals with “Adoption under the Juvenile Justice (Care and Protection of Children) Act, 2015 from Section 56-73. 

Section 2 (2) of the Juvenile Justice Act,2015, defines ‘adoption’ as the process by which an adopted kid is legally separated from his biological parents and becomes the lawful child of his adoptive parents, with all of the rights, privileges, and responsibilities that come with being a biological child.

The effectiveness of the provision 

Initially, the option of adoption was only accessible to the Hindu community after the Hindu Adoption and Maintenance Act came into effect in 1956, which facilitated the adoption of Hindu children by a person adhering to the Hindu community, and did not apply to communities such as Muslims, Christians, and Parsis, who had to depend on the Guardians and Wards Act, 1890, under which they could become guardians. However, the procedure only established a guardian-ward connection. The Juvenile Justice (Care and Protection) Act of 2000, which was last updated in 2015, was the first step toward a secular adoption law.

The Juvenile Justice Act establishes elaborate procedures for both in-country and intra-country adoption, which are governed by the Central Adoption Resource Authority, a statutory authority of the Government of India. A prospective parent can apply at their state’s Adoption Coordination Agency (ACA), which is a CARA-accredited agency in each state. This adoption agency prepares a complete assessment of the family, including pre-adoptive counseling that is valid for three years. At this point, potential parents can express their preferences. Once a suitable child has been selected, the agencies can arrange for potential parents to meet the youngster. If the match is made, the child can be placed in pre-adoption foster care after signing the foster care agreement.

Meanwhile, within 10 working days of matching, the Specialized Adoption Agency/Child Care Institution and the prospective parents submit an application with the District Court as co-applicants. According to Section 61(2) of the Juvenile Justice Act, all processes must be held in private and concluded within two months after filing. However, figures from the Ministry of Women and Child Development show that there is a large number of pending adoption cases in India’s Civil Courts that have been there for longer than the time limit specified in section 61(2) of the Juvenile Justice Act. Even though several adjustments have been made over the years to address concerns encountered during the Act’s implementation.

In cases of children in need of care and protection, the CWC is no longer the “ultimate authority.” The District Magistrate will be the CWC’s grievance redressal authority, and anyone linked with the child may file a petition before the district magistrate, who will consider and issue appropriate orders.

One advantage is that the district magistrate will be able to manage the process more efficiently and promptly since he has access to and is more familiar with all of the departments in his jurisdiction. 

Loopholes if any: a highlight 

Sections 14(1) and (2) of the  Act are primary core issues. The first is the basis on which the Juvenile Justice Board will decide whether a 16- or 17-year-old should be tried in a Regular Court or under the JJ Act. The most problematic feature of these tests is that almost all of them carry a presumption that the child is guilty of having committed the charge if they are positive. Furthermore, the question of how the Board will make these decisions in one month and before the actual trial remains unaddressed. Juveniles between the ages of 16 and 18 who are found guilty of committing terrible crimes after a preliminary inquiry by the Juvenile Justice Board will be transferred to a Children’s Court, which will be able to proclaim the youngster guilty. These minors can be held in a “safe environment” until they reach the age of 21. Even if they are deemed to have been “reformed” by the age of 21, they may be sent to adult prisons. The ‘place of safety,’ also known as ‘borstals,’ is currently unavailable in the majority of states.

Beyond rape and murder, the new juvenile laws have broadened the category of terrible crimes. All offenses punishable by seven years or more in jail are classified as heinous. Experts have examined the law and identified several offenses for which children can face adult charges. Offenses relating to drugs, war, trafficking, abetment of crimes, enabling one’s property to be utilized, and many others are among them.

According to the Juvenile Justice Act of 2015, there is a provision for specialists to be available in about 600 of the country’s above-mentioned districts to provide advice to JJBs. It will be determined whether or not a child committing a crime is in a ‘child-like frame of mind based on their findings. On paper or in a political debate, this theory may appear sound, but it is highly subjective in practice. It lays an excessive amount of responsibility on the Juvenile Justice Board, which may cave to public pressure and, as a result, minors may be moved to the adult criminal justice system.

This law has grown contentious as a result of the growing incidence of adolescent elopement and consensual sex among teenagers. The boys may now face rape charges. A kid cannot consent to a sexual act until the age of 18, hence any act of sex, even consensual, is considered rape under the Protection of Children from Sexual Offenses Act (POCSO).

It contradicts UN commitments derived from several conventions and guidelines to which India is a signatory, particularly recommendations 79 and 80 of the UN Committee on the Rights of the Child, which specifically request that India “ensure that persons under the age of 18 are not tried as adults, following the principle of non-discrimination contained in Article 2 of the Convention.

Recommendations and suggestions

  • The Juvenile Justice Act should be aggressively implemented. Acting without willing hands is inefficient and harmful. As a result, the government should ensure that the legislation is appropriately enforced by the authorities.
  • India should not have a uniform juvenile age for all crimes. The system can be designed along the lines of those used in the United States, the United Kingdom, and France to categorize and divide the Juvenile Justice system into distinct age groups.
  • Juvenile cases should not be moved to Adult Courts.
  • Every Juvenile Justice Board should collaborate with local child welfare agencies to improve their efficacy in providing safe shelter to abused and neglected children.
  • Members of the Juvenile Justice Board should collaborate with local child welfare agencies to improve their efficacy in providing safe havens for abused and neglected children.
  • The feasibility of establishing a non-judicial juvenile justice system should be investigated.
  • Ensuring and improving the quality of the juvenile correctional services process would result in justice for minors who have broken the law.
  • The juvenile age should not be reduced at all since it will have a far-reaching impact on India’s criminal justice system, which will be adverse to the advancement of justice and equity. 

Case laws associated with the same field 

Shilpa Mittal v. State of NCT of Delhi and Anr(2020)

Issue of the case

Whether an offense has a maximum punishment of more than seven years in jail but no minimum term, or with a minimum penalty of fewer than seven years, can be regarded as a ‘heinous offense’ under Section 2 (33) of the Juvenile Justice (Care and Protection of Children) Act, 2015. 

Judgment 

While considering the case, the Court stated that it was not the Court’s responsibility to fill in the gaps and fix them. The Court stated that it could add or delete words from the legislation if the legislature’s meaning was apparent. In circumstances where the aim of the legislature is unclear, however, the Court cannot add or eliminate words to offer meaning that the Court believes would fit into the scheme of things. The Court was interpreting a statute, which had to be construed by its wording and intent. The goal of the Act of 2015 is to ensure that children who violate the law are dealt with separately, rather than as adults. We cannot wish away the word “minimum” when the language of the clause stipulates a minimum of 7 years imprisonment when dealing with severe crime.

The Court dismissed the appeal by resolving the issue and ruling that an offense that does not carry a minimum penalty of seven years cannot be considered heinous. However, the Act does not address the fourth category of offenses, namely, offenses where the maximum sentence is more than seven years in prison but no minimum sentence or a minimum sentence of fewer than seven years is provided, which shall be treated as serious offenses within the meaning of the Act and dealt with accordingly until Parliament decides on the matter.

VikramDeo Singh Tomar v. State of Bihar (AIR 1988 SC 1782)

The Supreme Court has taken notice of the poor conditions in the State of Bihar’s care homes for women and children and has ordered the State to improve affairs in these facilities and provide at least the minimum living standards necessary to ensure human dignity.

 Gaurav Jain v. Union of Indian (1997)

The Supreme Court ruled that the children of prostitutes have the right to equal opportunity, dignity, care, protection, and rehabilitation to be included in the mainstream of social life without stigma. The Court ordered the formation of a committee to devise a plan for the rehabilitation of such children and child prostitutes, as well as its implementation and submission of the registry’s quarterly report.

Laxmikant Pandey v. Union of India (AIR1984 SC469)

In this landmark case, the Supreme Court of India established a couple of doctrines controlling the requirements for inter-country adoption. The lawsuit was initiated based on a letter filed to the court by a lawyer, Laxmikant Pandey, saying that social organizations and volunteer organizations engaged in the activity of selling Indian children to foreign parents are indulging in malpractices.

Conclusion

It is possible to conclude that a separate legal system for juveniles is required for better treatment of juvenile delinquent concerns. The reforming component of juvenile criminal legislation must take precedence over the deterrence component. It can be observed that, despite its inadequacies, the 2015 Act strikes a balance between the penal and the protective, such that the juvenile is effectively rehabilitated while also discouraged from committing the crime.

For more than a century, states have firmly believed in the concept of using the juvenile justice system as a weapon to protect the public by establishing a system that responds to criminal acts committed by children as they mature into adulthood. The rising rates of juvenile delinquency and crime committed by juveniles are pressing issues that must be addressed. Even though the government has enacted legislation to address this issue, these laws have done nothing to reform juveniles or stop them from committing crimes.

States acknowledge that children who commit crimes differ from adults in two ways: they are less culpable as a group and have a greater possibility for reform. To address the disparities, states have built a Court system for juveniles as well as a separate youth-based service delivery system that is available to adults. The reforming aspect of juvenile criminal law must take precedence over the deterrent aspect. It can be seen that the 2015 Act, despite its flaws, finds a balance between the penal and the protective, so that the minor is appropriately rehabilitated while also being dissuaded from committing a crime. 

References

 


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Direct selling companies under Consumer Protection Rules, 2021

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Image source: https://blog.ipleaders.in/consumer-protection-act-2019/

This article is written by Raslin Saluja, from KIIT School of Law, Bhubaneswar. This is an exhaustive article on direct selling companies under the Consumer Protection Rules, 2021. It covers how the rules have dealt with various entities, their responsibilities and liabilities, and the protection of customer’s interests in order to address the issues existing in the industry.

Introduction

Earlier in 2016, the Ministry of Consumer Affairs, Food, and Public Distribution had come out with a set of guidelines for companies that were advisory in nature. The draft rules now propose penalties for violations. These new rules will prohibit companies such as Amway, Tupperware which offer pyramid and money circulation schemes. These schemes will no longer be allowed to operate to protect the consumer’s interest in the country. This is for the first time, the Union Consumer Affairs Ministry has introduced a framework for direct selling and has sought public comments by July 21, 2021.

The Ministry of Consumer Affairs, Food, and Public Distribution issued a draft named the Consumer Protection (Direct Selling) Rules, 2021 in order to regulate direct selling activities, prevent fraud and protect the legitimate interests of the consumers. These would apply to:

(a) all bought or sold goods and services through direct selling;

(b) all models of direct selling;

(c) all direct selling entities offering goods and services to consumers in India; and

(d) all forms of unfair trade practices across all models of direct selling

These also apply to the existing direct selling entities who are required to comply with the rules within 90 days of its publication in the official gazette and are also applicable on the direct selling entity established outside India but offers goods or services to consumers in India.

Important definitions

According to Section 3(d), a direct seller is a person who is appointed or authorized through a legally enforceable written contract by a direct selling entity with the principal entity to undertake the direct selling business on a principal to principal basis.

Section 3(e) states the meaning of direct selling which continues to hold the same definition as under the Consumer Protection Act, 2019 which includes having a network of sellers for marketing, distribution, and sale of goods or provision of services, other than through a permanent retail location.

Section 3(f) defines a direct selling entity which means an entity not engaged in a pyramid scheme, and/or money circulation scheme, which sells or offers to sell goods or services through direct sellers.

Section 3(g) defines a direct selling network which is a network of direct sellers formed by a direct selling entity and includes a multi-layered network of direct sellers in which direct sellers introduce or sponsor further levels of direct sellers and supports them to receive in return any benefit which is solely as a result of the sale of goods or services. These networks also have to comply with some provisions such as:

  • Such networks should not be entitled to receive any remuneration or incentives for recruitment/enrollment of new participants in the direct selling business except as a result of the sale of goods or services by them.
  • It should not require any participant to buy goods/services for an amount higher than what is expected to be the usual price for a quantity that exceeds the amount that can be expected for selling/reselling purposes.
  • It should not require the new participant to pay any registration fees or sales costs for demonstrating the equipment and materials or other participation fees.
  • It should provide a written contract describing the material terms of participation to all the participants.
  • It should grant the participants a reasonable period of cooling off to cancel their participation and receive a refund that was given to participate. The cooling-off period shall not be less than 30 days.
  • At the request of the participant at reasonable commercial terms, it should allow them for a buyback or repurchase policy for currently marketable goods which are unpacked or services that are sold to the participant.,
  • Where the cooling-off period according to Section 3(c) is a time period during which one can change his mind about an agreement that he/she has made without causing a breach of contract and or levy of penalty;

Key features of the draft rules

A) Conditions for registration of direct selling entities

All the direct selling entities and direct sellers operating in the entities network within India have to mandatorily register themselves with the Department for Promotion of Industry and Internal Trade (DPIIT) and get a registration number allotted. The time period for allotment will be notified by the DPIIT who may extend the time for sufficient reason submitted in writing. Each of these entities needs to ensure that their registration numbers are on a prominent display on its website which is clear and easily accessible by its users and that for each transaction an invoice is issued. This will certainly be a progressive step as it would identify the entities and give them validation. It will also act as a filtration process to remove the bad elements of the industry.

According to Section 6, these direct selling entities also have to maintain either manually/electronically certain following documents/records at their registered office. These include:

  • Certificate of Incorporation
  • MOA & AOA
  • Copy of PAN & TAN
  • Copy of GST
  • GST returns
  • Income Tax returns
  • Copy balance sheet, audit report, etc.
  • Record of customers and direct sellers
  • Register of direct sellers

B) Conditions for the conduct of direct selling business

The draft direct selling rules set out detailed obligations, and duties for the direct sellers and direct selling entities towards consumers. These are as follows:

  • The direct selling entities have a duty to be incorporated under the Companies Act, 2013/1956 or partnership firm registered under the Partnership Act, 1932 or limited liability partnership registered under the Limited Liability Partnership Act, 2008 and have a minimum of one physical registered office in India.
  • They must own, hold or be the licensee of trademark, service mark, or any other identification mark identifying the direct selling entity with the selling goods or services provided and shall not give commissions, bonuses, or incentives on sale of products/services for which they are not the owner, holder, licensee of a trademark, service mark or any other identification.
  • They must have maintained an updated and working website with all relevant current details, contact information, management products, product information, price, and a grievance redressal mechanism.
  • They must issue proper identity cards fulfilling KYC verification documents to their direct sellers.
  • Their website must be accessible and must prominently display to its users the following information:
  • The legal name of the direct selling entity and the headquarters’s  primary geographic address along with its branches;
  • Contact details like email, fax, phone numbers of customer care as well as of grievance officer and a ticket number for each complaint lodged through which the consumer can track the status of the complaint;
  • Information relating to return, refund, exchange, warranty and Information required by the consumer to make informed decisions like guarantee, delivery and shipment, modes of payment, and grievance redressal mechanism. 
  • Information relating to payment methods, changing those methods, their security, any fees or charges payable by users, 
  • Contact information of the relevant payment service provider;
  • Disclosing all relevant mandatory notices and contractual information as per applicable laws. 
  • Total price in a single figure along with all the details and their breakup price, showing all the charges (compulsory and voluntary), for delivery, postage and handling, conveyance charges, and tax;
  • Provide information, at the pre-purchase stage to every direct seller and the consumers purchasing directly from Direct Selling Entity, which shall contain —
  1. Purchaser and seller’s name;
  2. The estimated delivery date of goods or services;
  3. The country of origin of the product;
  4. Month & year in which the product is manufactured;
  5. The procedure for the return of the goods;
  6. Goods warranty; and
  7. Exchange or replacement of goods in case of defect.
  • A prohibition from adopting any unfair trade practice in the course of business and to abide by the laws of the land.
  • Their products must comply with the declarations under the Legal Metrology Act, 2009.
  • They have to store the personal information provided by the consumer within the Indian jurisdiction in accordance with the laws and take all required steps to ensure the protection of such data.
  • They must maintain a record of relevant information for the identification of all direct sellers who have offered defective/spurious products or deficient services and display their websites and office premises publicly.
  • They are also required to maintain a record of all direct sellers under the direct selling entity including ID proof, address proof, email and other contact information.
  • They have to provide information regarding the direct seller to a consumer who requests in writing after purchase of goods/services including the address, name, email and any other necessary contact information with the direct seller for effective dispute resolution.
  • They have to ensure that the advertisements made regarding the goods/services are consistent with their actual characteristics, access and usage conditions. They also cannot directly/indirectly represent themselves and consumers and post reviews misrepresenting the quality/features of goods and services.
  • They will have to bear appropriate liability if they explicitly/implicitly vouch/ take a guarantee for the authenticity of the goods/services sold.
  • They are also obligated to monitor the practices of the direct sellers/ members in his network and ensure they comply with the rules by way of a legally binding contract and take disciplinary actions in case of non-compliance.
  • All the direct selling entities have to become a partner in the convergence process of the National Consumer Helpline of the Central Government.

C) Obligations of direct selling entity and direct sellers in relation to product liability

  • Both of them must ensure the terms of offer are clear and in consonance with the nature of what is being offered.
  • The presentations used of direct selling must not include any illustration, expression, description which can be verified, must be capable of substantiation, and must not directly or by implication mislead the consumer.
  • The demonstration offered must be accurate and complete in terms of price, and credit and payment options, cooling-off periods, return rights, guarantee terms, after-sales service, and delivery where applicable.
  • Direct selling must not be represented to the consumer as a form of market research.
  • It should not be misleading or deceptive and unfair trade practices must not be used.
  • All promotional literature, advertisements or mailings must contain the relevant contact information including the telephone number of the direct seller.
  • Direct selling in no way shall state/imply the existence of any additional guarantee/warranty which would give the consumer more rights than that has been provided by law.
  • They have to ensure that the guarantee or warranty terms are included along with all the relevant contact information of the guarantor shall be easily accessible to the consumer and any other restrictions, prohibitions on rights or remedies, shall be clear and conspicuous;
  • The form of order or other describing document sent along with the product should clearly state the remedial action open for consumers.
  • The presentation of the offer should only refer to any other description, document, or advertisement if it is genuine, verifiable, and relevant to such additional testimonials and endorsement.
  • All the service details should be included in the guarantee or stated anywhere else as stated in the offer for after-sales services and if the consumer accepts the offer, the information shall be given on easy activation access and communication with the agent of service provided.
  • Samples along with products where applicable should be suitably packaged for delivery to the consumer and for a return option, in accordance with the standards pertaining to the health and safety of the consumers.
  • Orders will have to be completed within the decided delivery date and if any unexpected delay arises, the consumer should be informed as soon as possible if it becomes apparent to the direct selling entity or the concerned direct seller unless otherwise stipulated in the offer. The consumer should also be granted cancellation if requested, irrespective of the fulfillment of the requirements, with a proper refund of the deposits, according to the terms proposed to the consumer at the time of purchase. In cases where it is not possible to prevent delivery, then the customer will have to be informed of the returning rights at the cost of the direct selling company or the direct seller as per the terms of returning procedure of the goods 
  • All information regarding the payment shall be clearly stated in the offer like whether payment is to be made in parts or full, details of any additional charges on postage, handling, taxes, etc.
  • For sales by installment, details on credit plans, deposit or payment on account, periodic value, time period of such amounts, and the total price in comparison with the immediate selling price, if any, shall be clearly shown in the offer.
  • The consumer shall be provided with any information needed to clarify the cost, interest, and form of credit either in the offer or when the credit is offered. 
  • The offer prices shall be maintained for a reasonable period of time unless the duration and specific time are stated.
  • The payment procedure and debt collection method should be determined before signing any contract and should be in writing such as to not cause inconvenience to the consumer, making due allowance for delays outside the consumer’s control.
  • Debtors should be approached in a reasonable manner and distinguished debt collection documents should be used that do not have the potential to create confusion.
  • They must follow the provisions of the Legal Metrology Act, 2009 and the rules.

Restrictions on direct selling entities and direct sellers

A direct selling entity and direct seller shall not –

  • Take part in any fraudulent activities or sales and take reasonable steps to prevent the participants from indulging in any misrepresentations or fraud, coercion, harassment, or unconscionable or unlawful means;
  • Engage, cause or allow any misleading conduct or likely to mislead with regard to any substantial details relating to its direct selling business, or to the goods or services being sold by itself or by the direct seller;
  • Indulge in mis-selling of products or services to consumers.
  • Use, or allow to be used for, fraud, coercion, harassment, or unconscionable or unlawful means in promoting its direct selling business, or to the goods or services being sold by itself or by the direct seller;
  • Deny taking back spurious goods or deficient services and give the refund amount paid for goods and services provided.
  • Charge any entry fee or subscription fee

Besides, a direct selling entity and a direct seller shall act in compliance with all the relevant statutory laws including payment of taxes and deductions as per Income Tax, norms and GST etc, and not induce consumers to make a purchase based upon being able to replace/return or get a discounted price by referring prospective customers to the direct sellers for similar purchases, if such reductions or recovery are contingent upon some uncertain, future event. 

Additional obligations of a direct seller  

(1) A direct seller shall-

(a) truthfully and clearly give his identification, the identity of the direct selling entity, the characteristics of the goods or services sold and the purpose of the solicitation to the prospect with any request before the sales representation 

(b) offer a prospect adequate and exact explanations and representations of goods and services, details such as prices, credit terms, terms of payment, return policies, terms of the guarantee, after-sales service;

(c) provide an order form to the consumer during or before the time of the initial sale, which shall contain all the relevant details such as identities of the direct selling entity and the direct seller and their basic identification and communication details such as name, address, registration number or enrollment number, identity proof and contact number of the direct seller, complete details and description of the goods or services to be supplied, their country of origin, date of the order, the total amount to be paid by the consumer, the timeline and location of inspection of the sample and delivery of goods, consumer’s rights to cancel  or return the order if it’s in the prescribed saleable condition and avail full refund on sums paid and complete details regarding the complaint redressal mechanism of the direct selling entity;

(d) take adequate steps to ensure that all private information is under protection, in accordance with the laws for the time being in force, provided by a consumer.

(2) A direct seller shall not-

(a) visit a consumer’s premises without  prior approval/appointment and always take his identity card 

(b) provide any literature to a prospect not received approval of the parent direct selling entity

(c) require a prospect to purchase any literature or sales demonstration equipment;

(d) make any misleading claim against the claims authorized by the direct selling entity in pursuance of a sale.

Persons not to be engaged in the business of direct selling

Any convicted person or bankrupt or a person of unsound mind shall not be allowed to engage in the business of direct selling.

Sale through e-commerce platform

Any person selling, displaying, or offering to sell, including an e-commerce medium, any product or service of a Direct Selling Entity will have to get prior written consent in order to make such sell or offers.

Prohibition of Pyramid Scheme and Money Circulation Scheme

The direct selling entity or direct seller shall not promote a Pyramid Scheme or participate in a money circulation scheme, under the guise of doing direct selling business. Herein money circulation scheme as defined under the Prize Chits and Money Circulation Schemes(Banning) Act, 1978 is a scheme that assures an easy and quick way of earning money from another so as to invest the amount in a money circulation scheme. 

Whereas a pyramid scheme is generally a structure in which an organizer initiates with one person representing the tip of the pyramid. One person recruits another who works under him and is required to invest some amount which is paid to the first recruiter. Since the person who was recruited by the initial recruiter has to make returns on his investment he then, in turn, recruits more investors who wish to invest a fixed sum of money and this goes on giving rise to a chain of pyramids. It is thus a multi-layer network of subscribers who in order to receive benefits enroll more and more subscribers. This practice is illegal in India, as in 2015 Reserve Bank of India even issued a statement warning investors to be cautious of these schemes that try to gain customers with promises of high returns.

Contravention of rules

If the nodal officer, Chief compliance officer, grievance officer of direct selling entity or by direct selling entity itself or by direct seller fails to comply with the rules shall be construed as ‘unfair trade practice’ as defined under Section 2(42) of the Consumer Protection Act, 2019 (35 of 2019) and their provisions shall apply for any violation of the provisions of these rules.

The grievance redressal mechanism and other key authorities

  • The direct selling entity must appoint a central chief person who can be contacted or an alternate senior designated functionary who is a citizen and resident of India, to ensure compliance with the Act or the rules and face the liability for grievances arising out of the sale of products, services or business opportunities by its direct sellers.
  • Direct selling entities are required to establish an adequate grievance redressal mechanism based on the count of grievances usually received by such entity from India and shall appoint a grievance officer for consumer grievance redressal with their updated and current information like name, contact details, designation put on display on their website whose URL must be printed on product information sheet or pamphlet. Further such appointed redressal officers must acknowledge the complaint filed within 48 working hours of the receipt of the complaint and normally redress it within a month which if delayed must be justified with reasons in writing and informed to the complainant.
  • The Chief Compliance Officer must also be appointed by all direct selling entities who shall be a managerial personnel/ senior employee of that entity and shall be responsible for ensuring all provisions of the Act and rules are followed and shall be liable in any proceedings relating to any data or communication with respect to a direct selling entity.
  • They are also obligated to appoint a nodal contact person who shall be their employee other than the chief compliance officer who is required to be available 24×7 for coordinating with the law enforcement agencies and officers to ensure compliance with their orders.
  • They must also establish a mechanism for filing complaints by the consumers through its offices, branches, and direct sellers through a person, post, telephone, email and website.

The Indian Direct Selling Association (IDSA)

The IDSA is a premier association of leading direct selling entities in India, which has welcomed the draft rules and the introduction of a regulatory framework. They have been waiting for this move since the enactment of the Consumer Protection Act, 2019 and believe that this is a positive step in regulating the entities, intermediaries, and people associated with the industry. They have been closely involved with the government after the 2016 Direct Selling Guidelines and the 2019 Consumer Protection Act. They have represented the industry for 25 years now in multiple fonts and successfully managed to engage the stakeholders into dialogue regarding the concerns and issues in the direct selling business.

The industry has been vocal about the requirement of a separate regulatory framework. Even the industry players are supportive and willing to adjust to the proposed draft. According to a 2019 report called The Global Direct Selling-2019 Retail Sales by the World Federation of Direct Selling Associations (WFDSA), in 2019, the Indian direct selling industry which comprises Amway, Oriflame, and Modicare among others, reported sales of US $2.47 billion and having these guidelines will certainly bring more clarity and structure to its working.

Conclusion

This step was indeed long-awaited. This allows India to join the list of other countries that already have clear regulations and mechanisms for direct selling services. Earlier there have been scams such as the Amway pyramid scam in 2013 where the distributors were tempted with false promises of easy money if they enrolled more distributors. Further, the products were overpriced and therefore the distributors later lost all their money since no customer was willing to buy such products. Another such is the Qnet scam that happened in August 2020, where the firm was accused of duping investors in a pyramid scheme. 

Having clear regulations is a positive step as it will help to address the various issues involved in the process of direct selling. The entities will no longer be doing as they like and the laws will have to be followed uniformly. The illegal practices that have been conducted under the guise of direct selling will no longer be accepted in the market. Since the draft rules have clearly demarcated between the pyramid schemes and direct selling network, it would create a healthy business atmosphere and will look after the rights of the customers in line with the developments in the industry.

References


Students of Lawsikho courses regularly produce writing assignments and work on practical exercises as a part of their coursework and develop themselves in real-life practical skills.

LawSikho has created a telegram group for exchanging legal knowledge, referrals, and various opportunities. You can click on this link and join:

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War insurance clause in the aviation industry

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Image source: https://bit.ly/2NwliE4

This article has been written by S Chandrashekar, pursuing a Diploma in Advanced Contract Drafting, Negotiation, and Dispute Resolution from LawSikho.com.

Introduction

Ever since Orville Wright and Wilbur Wright invented the flying machine, in 1903, aeroplanes have become an essential mode of domestic and international travel. Aeroplanes are used for carrying both passengers and cargo. In fact, during the recent ongoing COVID-19 pandemic India transported medicines like Remdesivir to the USA and other countries. Air travel is thus a lifesaver especially when time is of the essence.

Airplanes these days have huge sizes, high passenger capacity, high-powered engines, and innovative technological features. All these not only make the airline profitable by carrying passengers, reducing travel time but also ensure the safety of the aircraft.

The need for insurance in aviation

Air travel is fraught with many risks and dangers, some of which are very unique to the aviation industry like a technical failure, hijacking, bombing, and being shot down. Examples of such incidents include the hijacking of the Indian Airlines flight IC 814 from Kathmandu in Nepal to New Delhi, This flight was hijacked by Pakistani terrorists to Kandahar, in Afghanistan. 

Malaysia Airlines Flight MH370 took off from Kuala Lumpur heading for the Chinese capital, Beijing suddenly disappeared from the Radar Screens some 39 minutes into the flight. Till today nothing is known about its disappearance, though various theories like hijacking, suicide by pilots, shooting down of the plane have been circulated till today nothing has been proved.

Another Flight MH 17 of the Malaysian Airlines was shot down on 17th July 2014 while on a routine flight from Amsterdam to Kuala Lumpur. The shoot-down occurred in the War in Donbass, during the Battle of Shakhtarsk Raion, in an area controlled by pro-Russian rebels. A Ukrainian airliner crashed outside Tehran in 2016 killing over 170 people. This was a Boeing 737 built-in 2016 and checked only two days before the accident. The Boeing 737 had departed Imam Khomeini International Airport before dawn and was bound for the Ukrainian capital Kiev, it crashed into farmland at Khalaj Abad, in Shahriar county, about 45 kilometers (30 miles) northwest of the airport, apparently due to a technical snag.

All the above incidents illustrate that the dangers of airline travel cannot be foreseen. Hence the need for airline insurance. Aviation insurance is unique insurance that has gained commercial acceptance and provides coverage to the specific operations of an aircraft and other possible risks in aviation. Aviation insurance is quite different from other types of transportation insurance. The clauses, terms, limits in aviation insurance are quite unique and are different from other types of insurance policies. Aviation insurance has gained momentum only recently, especially the attack on the Twin Towers on 11th September 2001. There are various forms of aviation policies as listed below:

In-flight coverage

This provides coverage against damages that can happen to the aircraft while it is in flight. Though this is costly, it is worth it as most accidents happen when a plane is in mid-air.

Hull all risk

There are many institutions/associations like flying clubs that operate small planes and medium-size planes, private jets belonging to celebrities/politicians/business tycoons, aircraft that are used for agricultural spraying pesticides,  offering leisure rides, etc. Apart from providing insurance against any physical loss/damage to the insured plane, this policy also protects the plane against total loss and disappearance.

Loss of license

It is a statutory requirement for every aircraft crew member to have a valid license. There are times when such a license can be suspended on medical or disciplinary grounds. This leads to financial loss to the crew member. The crew member can get the coverage in case of permanent total disablement or temporary total disablement due to bodily injury or illness.

Spares all-risk insurance policy

If any loss/damage is incurred to the spares, tools, equipment, and supplies of the insured aircraft. This policy also covers any damages which are caused to a property by the aircraft.

Aviation personnel accident (crew member)

This is usually granted annually and protects the insured crew member against injury, disablement, or death as a result of an aircraft accident/mishap.

Exclusions : hull/spares war risk

War risk insurance

This is a type of insurance damage due to acts of war, including invasion, insurrection, rebellion, and hijacking are covered. Some policies also cover damage due to weapons of mass destruction. It is very frequently used in the shipping and aviation industries.  This type of destruction insurance generally has two components: war risk liability, which covers people and items inside the aircraft and is computed based on the indemnity amount; and war risk hull, which covers the aircraft itself and is computed based on the value of the aircraft. The premium varies based on the expected stability of the countries to which the vessel will travel. An aircraft cannot operate without this clause since their loan and lease agreements clearly specify that this clause must be included in their insurance policy.  

One of the reasons insurance companies were reluctant to include ‘WAR RISK’ in their insurance policies is because of the enormous amount of losses that would be caused to them. They would hardly be able to survive and would have to close down permanently.

War risk insurance policy is essential for airline companies that operate in war-struck zones and areas where there are terrorists. Some of these areas are Central, South America, West Asia, Nepal, Pakistan. During 1991, Gulf war airliners feared operating in the Gulf region due to the fear of being hit by the scud missiles which Iraq used to fire regularly. The airliners were also reluctant to get war insurance due to increased costs.  

Sample war risk insurance clause

One of the most common provisions in commercial aviation hull and liability policies is known as Lloyd’s wording AVN 48B. This provision could appear in the basic policy form (i.e., the main text), or might appear by way of endorsement. It provides:

EXCLUSIONS APPLICABLE TO ALL COVERAGES:

WAR, HI-JACKING AND OTHER PERILS EXCLUSION CLAUSE (AVN 48B)

This policy does not cover claims caused by:

(a) War, invasion, acts of foreign enemies, hostilities (whether war be declared or not), civil war, rebellion, revolution, insurrection, martial law, military, or usurped power, 

(b) Use of Nuclear Weapons or radiation.

Only the relevant portion relating to ‘WAR RISK’ has been reproduced above and other clauses not relevant have not been reproduced for the sake of brevity. Other forms of exclusion from AVN 48C and AVN 48D, which mention, for example, that loss caused by electromagnetic pulse and chemical and biologic pathogens also are excluded). From a reading of the above provision, it can be seen that the list of exclusion is pretty broad. Since many things that are listed are excluded, many terms have not been defined and are open to more than one interpretation. Terms such as “hostilities and “rebellion” are examples.

Features of AVN 48B

(i) It lists the dangers that are ordinarily excluded on the ground that they would result in huge losses which cannot be correlated.  For example (e.g., nuclear war and declared war) with events (not really “perils”) that have a very remote possibility of happening maybe once in a lifetime and cannot be correlated (e.g., a “malicious act”).

(ii) It has a very broad scope. No matter how impossible the occurrence of a certain act may seem, if a policyholder wishes security under the circumstances encompassed by the exclusion, he ordinarily should seek a specific write-back of coverage. 

This clause is an exclusion clause and not provided as a matter of routine in the aviation insurance policies.  

Conclusion : benefits of war risk in the aviation insurance policy

War risk insurance though excluded under the aviation insurance policies can be availed of by a write back and need to be incorporated in the insurance policy.

Two major factors make a strong case for its inclusion

  1. Insurance companies cannot compute the premiums to be paid by the insured to cover the risk of war;
  2. The need for insurance companies to protect themselves against a financial disaster in the case of war.

All of our travel either for business or leisure. Thus air travel has become an inseparable part of our lives. However, air travel is fraught with many risks like turbulent weather, terrorist activities leading to hijacks, mysterious disappearance of flights, auto/technical failure, or a plane crash.  Flying always encompasses life-threatening dangers. 

Providing war risk insurance gives airline companies a competitive advantage. While having writebacks in the insurance policies, it is essential to scrutinize the wordings. Insurance companies will not write back all exclusions  (such as hostile nuclear detonations). The same word may mean a difference in the basic policy and the write-back of the exclusion clause. One must have a  proper understanding of the terms such as availability, cost, scope, and meaning of coverage for war, terror, and other such dangers. To have a proper write-back of the exclusion clause relating to war risk it is essential to have the involvement of the policyholder’s risk department, its aviation broker, and legal counsel.


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Controversy related to the election of External Affairs Minister S. Jaishankar to Rajya Sabha and related provisions in Indian Law

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This article is written by Ms Aporva Shekhar from KIIT School of Law. This article is a brief analysis of the recent controversy relating to the appointment of S Jaishankar to the Rajya Sabha and the position of law.

Introduction

Jaishankar is the External Affairs Minister whose election to the Rajya Sabha in July 2019 was contested. His election and that of Jugalji Thakor was challenged by three Congress leaders, Chandrikaben Chudasama, Gaurav Hemantbhai Pandya and Paresh Kumar Dhanani. The situation arose because two MPs (Member of Parliament) from Gujarat, Smriti Irani and Amit Shah who were the members of the Rajya Sabha, won elections to the Lok Sabha and therefore, left their seats vacant. In order to fill this vacancy, the Election Commission of India decided to hold separate elections for the two vacancies that were created by the resignation of Smriti Irani and Amit Shah in May 2019. This decision of the Election Commission and the subsequent appointment of S. Jaishankar was challenged to be violative of statutory rules by the Congress party member Gaurav Pandya.

Summary of the matter

A career diplomat, Subrahmanyam Jaishankar played a crucial role in shaping US and China policies for India. He retired from the Indian Foreign Service in 2019. After retirement, S. Jaishankar joined the TATA Sons group as president of global corporate affairs. After the Modi government won a fresh mandate in the 2019 elections, S.Jaishankar returned to government service as the External Affairs Minister. The Rajya Sabha ministers, Smriti Irani and Amit Shah were MPs from Gujarat who resigned in May 2019 after winning the Lok Sabha election. After their resignation, the Election Commission had to fill up the two vacant seats that were left, so it decided to hold by-elections and notified the same to be scheduled for Rajya Sabha on 5th July, 2019. Since there were two vacancies, MLAs (Member of Legislative Assembly) could vote separately for both the positions and the BJP contestants won the seats by securing 104 votes and S. Jaishankar and Jugalji Thakor were appointed to the Rajya Sabha.

The conflict and the problem

Chandrikaben Chudasama and Pareshkumar Dhanani were Congress nominees who lost the election to S. Jaishankar and Jugalji Thakor. It was also reported in the by-elections, MLAs Dhaval Zala and Alpesh Thakor, who later quit the Congress party, had cross-voted, attracting the fire of fellow party members who were eyeing the Rajya Sabha seats and the election. The MLAs are supposed to list their preferences if more than one candidate is to be elected since the Rajya Sabha elections are held on the basis of a single transferable voting system. The decision of the Election Commissioner to hold separate elections to fill the vacancy reduced the chances of the Congress party to secure the seats in the election. Congress leaders filed multiple petitions to the Gujarat High Court and the Supreme Court in an attempt to invalidate the appointment of S. Jaishankar and Jugalji Thakor. They contended that the Election Commission’s elections were violative of the Constitution, Conduct of Election Rules, 1961, and the Representation of People (RP) Act, 1951 and therefore were illegal and void. The appointment of Jugalji Thakor was challenged by Congress nominees Chandrikaben Chudasama and Paresh Kumar Dhanani, and the appointment of S. Jaishankar was challenged by Gaurav Hemantbhai Pandya, another Congress party member based on statutory and constitutional legality. The contention of all the petitioners challenging the validity of the separate by-elections held by the Election commission for Rajya Sabha was that it was violative of rules.

Related provisions to Rajya Sabha elections in Indian Law

The relevant provisions that need to be considered with reference to the subject matter of this article are as follows:

  • The Constitution of India;
  • Representation of People Act, 1951.

The Constitution of India

Article 80(4) of the Constitution is relevant in this context as it deals with the composition of the Rajya Sabha, and the sub-article (4) specifically deals with the election of the members of the Rajya Sabha and the scheme of such an election. The Article states that the representative for every state shall be elected by the elected members of the legislative assemblies for the Rajya Sabha, which should be in accordance with the rules and orders. It shall also be governed by the system of proportional representation along with single transferable votes for voting.

Representation of People Act, 1951

  • Section 12 of this Act deals with the notification for biennial elections for the Rajya Sabha. It states that the office of the President, on the recommendation of the Election commission of India, through the publication of one or more notifications calls upon the members of the electoral college or the legislative assembly of the concerned state to elect members for the purpose of filling up a vacancy in accordance with the rules and provisions of the Act mentioned above. There is also a proviso to this section which states that no notice shall be issued more than three months before the expiry of the term of office of the retiring member concerned under this section.
  • Section 147 of the said Act deals with the casual vacancies in the Rajya Sabha. It states that when the seat of an elected member of the Rajya Sabha becomes vacant or is declared void before the expiry of the term of their office, the Election Commission may call upon the members of the electoral college or the legislative assembly as the case may be by a notification in the Official Gazette of India to elect a person for the purpose of filling up the vacancy by such time as may be stated in the notification, and the rules and orders shall be applicable in relation to the election of such member to fill up the vacancy as far as may be.
  • Section 151A focuses on the requirement of the Election Commission to fill up casual vacancies, it mandates that the Election Commission must fill up any casual vacancy created as mentioned in Section 147 in the House of Parliament or the State Legislature as the case may be, through by-elections within six months’ time starting from the date of the vacancy. There is also a proviso to this Section which states that the remaining term of the vacancy of the seat occupied by a member should be one year or more.
  • Section 39(1) of the abovementioned Act is relevant considering the subject matter as it deals with the nomination of candidates. Clause (1) deals with notifications that shall be made after the electoral college or the members of the legislative assembly have been called upon for the elections. It states that as soon as the notification calling upon the electoral college or the members of the legislative assembly is issued the Election Commission should also publish another notification in the Official Gazette for :
    • The last date to make nominations which shall be seven days after the first-mentioned notification and if that day is a public holiday then the next day which is not shall be the last one.
    • The day after the last day to make nominations shall be the day for scrutinizing such nominations and if that is a public holiday then the next day which is not, shall be the one.
    • The second day after the date of scrutiny shall be the last day for the withdrawal of candidature and if that day is a public holiday then the next day which is not shall be the last.
    • Seven days after the last day to withdraw the candidature, the date when the poll shall be taken, if necessary, should be fixed.
  • Section 56 of the abovementioned Act provides for the fixing of the time for the election poll, this section states that the hours during which the poll shall be taken will be fixed by the Election Commission which shall be published in the prescribed manner. There is also a proviso under this section, which states that a total period allotted for the polling on any one day should not be less than eight hours for the election in a parliamentary or assembly constituency.
  • Section 100 of the abovementioned Act enlists the grounds on which an election can be declared void, with reference to the subject matter of this Article, the sub-clauses (d) and (iv) are important, which states that if the High Court is satisfied that the election of returned candidate has been materially affected because of any non-compliance of any rules, orders or provision of the Constitution or the above mentioned Act, it shall declare the returned candidate’s election to be void.

The decision of the Gujarat High Court

The Gujarat High Court rejected the petition of all three Congress members challenging the validity of the elections of S Jaishankar and Jugalji Thakor. In the case of Subhramanayam Jaishankar v. Gaurav Hemantbhai Pandya (2020), the High Court clarified its point of view regarding the questions raised in the case. In its judgement, the Court stated that the original petitioners failed to disclose their cause of action and that was violative of Sections 86 and 87 of the Representation of People Act. The High Court also observed that the original petitioners failed to present any provision of law that mandated the Election Commission to conduct single by-elections to fill up casual vacancies.

The Congress leaders in their petition challenged the validity of the Election Commission’s practice to conduct by-elections as separate elections are incorrect, which is a consistent precedent followed by the Election Commission. In response to this, the Court opinioned that the averments made by the original petitioner could not justify the non-compliance of the specific provisions of the Constitution and Section 100(d)(iv) of the abovementioned Act. The Court stressed that the failure to mention the grounds upon which had to be disclosed under Section 100 had amounted to non-compliance of Section 81 of the abovementioned Act and therefore, the Court dismissed the said election petition according to Section 86 of the abovementioned Act. 

Appeal to the Supreme Court

After their petition was rejected by the Gujarat High Court, the Congress leaders moved the Supreme Court in order to invalidate the election of S Jaishankar to the Rajya Sabha. The senior advocate and Congress member Kapil Sibal represented Gaurav Hemantbhai Pandya in the Supreme Court. Kapil Sibal contended that there was a serious question of law involved in the concerned appeal regarding the Election Commission’s power to hold separate by-elections to fill up casual vacancies in the Rajya Sabha simultaneously. The Congress leaders filed multiple petitions challenging this election, so for expediency, the Supreme Court bunched together all the petitions concerning the same subject matter.

In response to the multiple petitions filed by the Congress members, S. Jaishankar stated that they were misusing the process of law by filing multiple petitions and stated in his affidavit that no rules were flouted by the procedure adopted by the Election Commission to conduct the elections. Senior advocate Harish Salve represented S. Jaishankar in the Supreme Court before the bench of CJI SA Bobde, JV Ramasubramanian and J. AS Bopanna. The Supreme Court stated that it would pronounce an authoritative decision to clarify its stance regarding the power of the Election Commission to issue separate notifications for conducting by-election for filling up regular and casual vacancies in the Rajya Sabha. The decision has not yet been pronounced.

Conclusion

The centre of the entire controversy was the decision of the Election Commission to conduct by-elections separately for the two Rajya Sabha seats. The polls for the by-elections were conducted on the same day but separately which irked the Congress members as they failed to capture the seats. The Congress members were positive that if the elections for the seats were not conducted separately, they would have won at least one Rajya Sabha seat based on the single transferable vote system. But they failed when the elections were conducted separately and both the seats were bagged by the Bharatiya Janata Party members. They then approached the courts to invalidate the elections, but when the High Court rejected their election petition they approached the Supreme Court.

References


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Victim assistance in the Indian criminal justice system

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This article is written by Ms. Kishita Gupta from Unitedworld School of Law, Karnavati University, Gandhinagar. This article deals with the concepts and the aspects relating to victim assistance in India.

Introduction 

Victims of crime receive no assistance from the justice system. The concept of a fair trial and justice was noted in the case of  Mohd. Hussain @ Julfikar Ali vs The State (Govt. Of NCT) Delhi (2012) as entailing a triangulation of the accused’s, victim’s, and society’s rights and interests. The rights of the community and the accused are meticulously delineated under an adversarial system, and they frequently supersede those of the victim, whose rights are procedurally non-existent. Rather than an individual who has been damaged, the victim is seen in connection to society and the offender.

It has been claimed that regulations and processes have been put in place in various countries to provide for more humane treatment of victims. Greater acknowledgement of victims’ rights, the importance of their role in the process, and their vested interest in the case and its conclusion are examples of such policies and procedures. In many nations, Court-related support to victims, particularly in criminal procedures, is still quite rare.

Meaning of the term ‘victim’ 

The word “victim” comes from the early religious concepts of pain, sacrifice, and death. The term victim was a well-known notion in ancient civilizations, particularly in Babylonia, Palestine, Greece, and Rome. The law in each of these civilizations required that the victim be regarded as a human being who deserved to be made whole by the criminal.

The term victim is defined by the United Nations Declaration of Basic Principles of Justice for Victims of Crime and Abuse of Power which is the Magna Carta on Victims’ Rights:

“Any person who has suffered any mental, physical, emotional, economic, or substantial impairment of their fundamental rights, individually or collectively, as a result of acts or omissions that are in violation of criminal laws operative within member states, including those laws prescribing criminal abuse of power.”

A “crime victim” is someone who has been physically, financially, or emotionally wounded, or whose property has been taken or damaged by someone who has committed a crime. A “general victim” is someone who has been physically, financially, or emotionally wounded, or whose property has been taken or damaged by someone, an event, an organization, or a natural phenomenon.

Another crucial aspect is the acknowledgement of victims of power abuse. If a person is harmed as a result of a government act, he is a victim of an abuse of power. In the case of Rudul Shah vs. State of Bihar (1983), the Supreme Court, in dealing with the suffering of under-trial inmates and those in correctional institutions, referred to them as victims of abuse of power, allowing them and their rights to be protected to a large extent. Furthermore, in Alister Anthony Pareira vs State of Maharashtra (2012), the Court held that the legal system owes it to such victims of crime and abuse of power to safeguard them, thus expanding the state’s role in the justice system.

The concept of victim adopted under Section 2(wa) of the Criminal Procedure Code of 1973, on the other hand, is at odds with international standards. In order for a victim to be involved, the accused must be identified and charged; and despite the Supreme Court’s affirmative steps, victims of power abuse have not been recognized. The aforementioned definitional difference is the first step toward a miscarriage of justice.

Meaning of the term ‘victim assistance’ 

“Victim Assistance, Support, or Services” refers to the activities carried out in reaction to victimization with the goal of alleviating suffering and easing recovery. Information, assessments, individual interventions, case advocacy, system advocacy, public policy, and program creation are all examples of this.

According to the United Nations Office on Drugs and Crime (UNODC), victim assistance attempts to provide holistic help that extends beyond the criminal justice system. It’s not just about rescuing the victim. It primarily serves two purposes: 

  1. It recovers victims’ wholeness after they have been victimized;
  2. It has procedures in place to lessen the danger of re-victimization. 

As a result, it seeks to give victims a sense of agency and power. The goal of victim assistance is to improve the victims’ quality of life, which has been harmed by the crime. Victim support as a right begins when a crime is committed and continues until the victim’s previous position is restored. The criminal justice system is merely one aspect of the overall picture.

Compensation for victims of a crime in India

Victims of any crime or violation of human rights (regardless of legal status) have the right to be compensated for the losses incurred as a result of the crime perpetrated against them. Compensation for material (such as unpaid wages and medical expenditures) and non-material (such as pain, suffering, and trauma) damages can be sought through criminal, civil, or administrative procedures.

In India, victim assistance is frequently misunderstood to mean just compensating victims. The victim compensation scheme, which was enacted by a 2009 Amendment to the Criminal Procedure Code, requires every state government to develop a plan for compensating and rehabilitating crime victims. The National Commission for Women has recommended establishing a Criminal Injuries Compensation Board to compensate rape victims. 

The above idea is based on Supreme Court of India directives granted in the case of Delhi Domestic Working Women’s Forum vs. Union of India and others (1994), which asked the National Commission for Women to develop a “system to wipe out the tears of unlucky rape victims.” The SC stated that, in light of the Directive Principles contained in Article 38(1) of the Constitution of India, it was necessary to establish a Criminal Injuries Compensation Board, as rape victims frequently suffer significant financial losses in addition to mental anguish, and in some cases are too traumatized to continue working. The Court further ordered that compensation for victims be granted by the Court if the criminal is convicted, and by the Criminal Injuries Compensation Board whether or not the offender is convicted. If a woman becomes pregnant as a result of rape, the Board must consider her pain, suffering, and shock, as well as her loss of earnings and childbirth expenditures.

“It would be appropriate if NALSA sets up a Committee of about 4 or 5 persons who can prepare Model Rules for Victim Compensation for sexual offences and acid attacks taking into account the submissions made by the learned Amicus,” the Supreme Court of India said in Nipun Saxena vs. Union of India (2018). Both the learned Amicus and the learned Solicitor General have pledged to help the Committee as needed. “The Chairperson of the National Commission for Women, or a nominee for the Chairperson, should be a member of the Committee.”

The fact that states have sole authority over compensation systems creates challenges not only in terms of implementation but also in terms of victim discrimination. Regardless of the matter at hand, where they seek justice, victims have the right to be treated equally. Furthermore, compensation is not available to victims until the appeal’s limitation period expires or the appeal is underway in Court. In an already overburdened legal system, this creates a substantial hindrance to destitute victims’ ability to support themselves, negating the entire purpose of compensations. Compensations, on the other hand, are only one of the victim’s many rights. Compensation is insufficient in circumstances where the victim dies or becomes handicapped. Victim assistance is a multifaceted system aimed at easing the victim’s situation, with compensation being only one component.

In India, the actual obstruction to victim help is twofold. To begin with, there is a lack of a structural legal framework for supporting crime victims. Section 357C of the Criminal Procedure Code, 1973, inserted by the Criminal Law (Amendment) Act, 2013, and the guidelines and protocols on medico-legal care for survivors/victims of sexual violence prepared by the Ministry of Health and Family Welfare are the only two major legislative actions that refer to victim assistance and except for this, there are no other legislative frameworks that supports the crime victims.

Types of assistance

Emotional assistance

Criminal activity can have a negative impact on the victim’s mental and emotional health. If a person has been impacted by a crime, one of the ways the victims may be assisted is, by providing them with the emotional assistance that they require. Counselling is a sort of treatment in which skilled specialists examine a person’s entire life and background in order to help them better understand themselves.

Financial assistance

As noted above, financial assistance is also required by the victims of crime and hence, the Government of India provides compensation to the victims of crime under Section 357C of the CrPC. It helps the victims and their families who were dependent on them for the livelihood of the household to sustain a living for them.

Stakeholders for victim assistance

Police 

Because the police are the initial point of contact in the criminal justice system, they must be well-equipped to deal with victims. Section 154 of the Code of Criminal Procedure (1973) obliges a police officer to write an FIR. They must collect evidence while keeping the victim’s dignity in mind and treating them with respect regardless of the offence. The police must subsequently refer the victim to lawyers, non-governmental organizations, and other support systems that can provide the greatest possible assistance. The police shall act according to the role prescribed under the CrPC under Section 173, 301, 421, 164, 342 and 364. These are delicate matters of victim assistance and police should handle them in such a way only.

Lawyers and prosecutors

Lawyers and prosecutors play a role that is similar to that of the police. Prosecutors should be taught to strive for justice rather than conviction. Lawyers serve as a link between the police and the victim, and by collaborating with the prosecutor, they should ensure that the victim’s best interests are represented in Court. Victims of hurtful, threatening, or violent situations can seek support from the victim advocacy program. Victim Advocates are specially trained staff who offer: 

  1. Personal assistance and an opportunity to talk about what happened.
  2. Information on options and resources, as well as answers to frequently asked questions.
  3. Assistance in deciding on a plan of action and thinking it through.
  4. Accompanies the victim to meetings, Court hearings, and other events, or acts as a liaison.
  5. Connection to resources on campus, in the community, and at the state level for counselling, advising and reporting.
  6. A link to the university’s offices (when appropriate, advocates can work with faculty and staff).

Judiciary 

The judiciary must be a fair and unbiased body that monitors the course of a criminal case. All parties participating in criminal procedures should have their rights considered and protected by judges. Victims should be afforded crucial protection by judges. Special arrangements, such as permitting the victim to testify through closed-circuit television, can be authorized in cases involving children, if applicable and possible.

Individual rights are solely protected by the judiciary. The courts play an important role in victim protection, from accelerating trials to including victims in all phases of the proceedings. However, there have been a number of cases when the judiciary has openly overlooked the victims’ rights and interests. The judiciary has failed the victims by issuing orders such as granting bail on the condition of tying a rakhi to the rapist (which was later scrapped by the SC) or asking a rapist to marry the victim based on the accused’s assertions. Despite being the guardian of the rule of law, the judiciary has maintained a limited and discriminatory attitude towards victim relief. 

But there has been a positive response also from the judiciary. The Supreme Court required the use of cameras during trials, particularly where the victim is a child or a rape victim, in Sakshi v. Union of India (2004). The Supreme Court held in Nirmal Singh Kahlon v. State of Punjab (2008) that the right to a fair investigation and trial applies to both the accused and the victim, and that this right is guaranteed under Article 21 of the Indian Constitution. As a result, a victim of a crime has the same right to a fair investigation. The Supreme Court concluded in Bodhisattwa Gautam v. Subhra Chakraborty (1995) that if a Court trying a rape case has jurisdiction to award compensation at the end of the case, the Court also has the authority to give interim compensation. After determining the accused’s prima facie guilt, the Court ordered him to pay a monthly sum of Rs. 1000 to the victim as interim compensation, as well as compensation arrears dating back to the date of the complaint. The Madras High Court, based on the report of a commissioner appointed by it to assess the losses, ordered payment of varying amounts of compensation for the loss of property of the Sikh community in Coimbatore in R. Gandhi v. Union of India (2020).

In Nilabati Behra v. State of Orissa (1961), the Supreme Court stated that the state must compensate the petitioners for the harm caused by its officers. As a result, strict liability for violations of fundamental rights is a remedy available in public law to which the principle of sovereign immunity does not apply, such as awarding compensation in a proceeding under Article 32 or Article 226.

Mediators

Mediation programs bring the perpetrator and the victim together in person to work out a restitution agreement. The goal is to improve the victim’s social condition, which has been harmed by the offender. The entire mediation method differs from regular criminal proceedings in that a mediation session can only be scheduled with both the victim and the offender’s cooperation. Participants in a reconciliation session can bring up any social conflicts that may have contributed to the delinquent behaviour. However, critics of the employment of informal procedures (such as mediation, arbitration, conciliation, and applied therapeutic techniques) have raised concerns about potential risks, such as the application of undue pressure to one or both sides.

Non – Governmental Organisations (NGO)

Victim support services must be accessible in order to help as many victims as possible. This accessibility will be expressed in a variety of ways, including availability in both urban and rural locations, offices that are relaxing and pleasant, and victims’ privacy and anonymity. Victimization is a one-of-a-kind, individualized experience in which victims’ needs change over time and are influenced by personal and environmental circumstances. The ability of organizations and institutions to respond to the unique circumstances of victims is a critical prerequisite that can aid particularly vulnerable victims in seeking and receiving assistance.

Helplines, emotional, practical, administrative, and psychological support, legal aid, and accompanying are all services that NGOs frequently give. Because of the nature of these services, their effectiveness will be determined by their accessibility and availability, as well as the capability, aptitude, and attitude of employees who interact with victims. Cost-cutting is a critical component of any business. Decisions on how and who will deliver a service are frequently influenced by the financial implications.

Conclusion

The victim support movement promotes a restorative-justice policy that tries to resolve criminal acts with comprehensive programs that address both the victim’s and offender’s needs. The author further contends that because the state is responsible for protecting its inhabitants, it is equally responsible for giving reparations to crime victims as a matter of social justice. It is found that, despite India’s significant improvements in criminal investigations and prosecution, crime victims’ sufferings have been mainly ignored. In many situations, victims’ suffering has been alleviated only via the assistance of humanitarian organizations and human rights commissions, and this is more common in cases of newsworthy crimes.

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Financial strategies you can adopt as a non-profit organization

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Indian Trusts Act
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This article is written by Aditi Sahu, pursuing Diploma in Business Laws for In-House Counsels from LawSikho.

Introduction

For any successful business organization or enterprise, either profit or non-profit company, financial stability plays a role of a foremost element. It is more important than generating revenue but the organization should maintain a balanced budget for their continuance. This is applicable for both profit-making and non-profit organizations. 

The main aim of the profit-based organization is to maximize their profits i.e. increasing revenue because the business is more stable if the cash reserve is high in the organization. The companies face less risk if they have a large cash reserve and strong cash flow which allows them more access to debt and equity markets for expansion. 

Similarly, in the case of a non-profit organization, financial stability is the main objective for them, but here profit maximization is not the primary focus of the company. For a non-profit organization, the main goal is not to generate profit but to provide goods or services to the customers that meet their required needs.

Providing community-based goods and services to the customers in society that meet their required needs be regarded as the mission of the non-profit organization. They also seek a large number of funds or donations from like-minded people whose main interest is to uplift society and to achieve this goal, they give donations to the non-profit organization, which may properly utilize the given resources from donors for public goods. For achieving these objectives, the non-profit organization should have proper financial strategies i.e. how they allocate their funding (stages of funding) or; the amount of the funds that they allocate for public benefits or; for which public goods and services, the organization would invest or raise donations from donors, etc. 

What is meant by a non-profit organization?

A non-profit organization (NPO) refers to an organization that is not driven by profit, however, it focuses on the welfare of society by dedicating all its income to charity, environment protection movements, cooperatives, and religious groups, etc. 

Most NPOs have non paid staff and they act as volunteers. Generally, non-profit organizations (NPOs) are availing tax exemption. NPOs that may consolidate for Charitable or religious purposes are availing tax exemption under the Income Tax Act, 1961. The charitable or religious purposes include relief of the poor or distressed people, medical relief, environmental protection (such as forest and wildlife protection, groundwater and other water bodies protection and preservation), education, advancement in public utility services, etc. 

In India, the terms NPO and NGO (non-government organization) are also often used simultaneously because most of the NGOs are non-profit organizations but both they are different to some extent. Generally, NGOs are separate from the government and don’t require a government council but they depend on the government for funding.

In India, there are three legal forms of NPOs. These are Trusts; Societies and Section 8 Companies (under Companies Act, 2013).

  • Trusts

Trusts are classified into two types, one is a private trust and another one is a public trust. The Public charitable trust may be designed for the benefit of an uncertain and fluctuating class, such as the general public or class of public which could be the potential beneficiary. The Public charitable trust may be established for certain purposes, such as education and medical relief, poverty relief, a recreation of General Public Utilities, etc. Although there is no central legislation that governs public charitable trust, many regions such as Maharashtra, Gujarat, Rajasthan, and Madhya Pradesh have their Acts on Public Trusts. 

In India, generally Public charitable trusts are irrevocable, but if the trust is inactive for a longer duration due to the negligence of the trustee, then, the Charity Commissioner may take steps to revive it. 

In the case of Trusts, the Doctrine of Cypress i.e. “as near as possible” was applied mainly for changing the purpose of the trust because it is difficult to carry out its objectives. 

  • Societies

Societies are regulated under the Society Registration Act, 1860 for charitable purposes. It is a membership organization having a managing committee and governing council to regulate its activities.

As per the provision of the Statute named, Society Registration Act, 1860, Section 20 states that the society might be registered as;

  • Charitable society; 
  • Society established for the promotion  of science, arts, literature, education, or fine arts; and 
  • Society established for public art museums and galleries, etc.

Also, the governance of society differs from trust, unlike trusts, societies may dissolve. At least, 3/5th voting of the society’s members is required for the dissolution of society.

  • Section 8 of Companies Act, 2013

These Section 8 companies are registered under the Companies Act, 2013 for promoting commerce, art, science, sports, education, research, social welfare, religion, charity, protection of the environment, or any other Object. 

The profits and any other income are applied for promoting only the object of the Company and also no dividends are paid to its members. 

Like a society, a Section 8 company may get dissolved. 

Financial strategies and their components

In an organization, financial strategy deals with the procurement or utilization of funds. The primary concern is to ensure that the organization should have an adequate and proper supply of funds to meet their present and future needs and also they must accomplish their desired goals. Also, financial strategy refers to one of the critical components of the business organization. 

Therefore, we can say, the financial strategies ensure the source of funds & their usage and try to manage these funds appropriately. It focuses on the appropriate alignment of financial management and business objectives of an organization for their strategic advantage and it leads to business growth.  

As per the theory of Thomas Wheelen and David Hunger;

“Financial strategy deals with the financial aspects of the organization and ascertains its possible course of action. It also provides a competitive advantage at low-cost funds and flexibility to raise capital to support business policies. Thus, the financial strategy focuses on maximizing the financial value of a business of an organization or an enterprise.”

There are certain components of financial strategy which enable the company for better financial management. These components are:

  • Financing decision

The financial position of the company plays a crucial role in any decision-making process. For any organization, either a profit or non-profit organization, funds availability is called freebies for the execution of any strategic plan.

While raising funds, the financial managers are bound to ensure that the funds are allotted at minimal risk. He should decide the nature of the fund, either from external sources (such as raising capital by issuance of equity shares, preference shares or debentures, and borrowed money as term loan) or internal sources (by reserving or retention of profits and depreciating the value of fixed assets). 

Based on the financial position, some of the strategic decisions are taken by the organization;

  1. What are the sources and in what proportion the long-term funds were allocated?
  2. To what extent the long-term debt has resorted?
  3. Can a firm employ commercial credits? If they can, then to what extent the firm may employ commercial credits?
  4. Should the firm take recourse to capital lease (a source of medium and long term funding where the lessor (the owner of an asset) gives right to the lessee (user of an asset), to use these assets against periodical payments made by the user)?
  • Investment decision

Investment may refer to a path for wealth creation, which helps to accomplish the financial goals and also stabilize the future in terms of financial aspects. Investment may occur by advancing our money for purchasing the securities, i.e. shares, bonds and debentures, investment in real estate, mortgages, etc. 

In an organization, one of the vital components of the financial strategy, i.e. Investment. It plays a major role in the present and future aspects, because any investment made by the company may result in a boon or bane for them.  An organization should make a prudent decision while making any investment because it involves a high percentage of risk.  That’s why, investment decisions play a major role for the present and future aspect, because any investment made by the company may result as a boon or bane for them. 

The investment decision may be considered as profitable and successful only when the investor consider certain important measures, such as-

  1. Hurdle rate– The hurdle rate refers to the minimum rate of return on any project or investment. It also describes appropriate compensation at every level where risks are present. The financial strategy of an organization always seeks wealth maximization, that’s why, if the expected returns are higher than the hurdle rate then the investment may sound worthy and vice versa.
  2. Capital rationing- Capital rationing places certain restrictions or sets limits on a company’s investment against funds availability in an organization for a particular time interval.
  3. Risk factor- It is considered an important factor while investing, therefore, the finance manager must analyze the risk factor whether the investment contains high or low risk. For better investment, the financial strategy gives clear guidance regarding the risks involved in the investment.
  • Dividend decision

For better strategic planning, a dividend decision made by an appropriate authority in an organization plays a prominent role. Here, the appropriate authority is referred to as the finance manager or other higher-level managers, who determine the amount of dividend out of profit which is paid to the shareholders of an organization and also decides what amount should be retained for further growth, expansion, and development of an organization for striking a good balance between both of them. 

  • Working capital management

In an organization, the working capital is referred to as the current assets of the management which is required in day-to-day activity. If the working capital is managed efficiently then, it maximizes shareholders’ wealth. The major sources of working capital are bank loans, overdrafts, trade credits (also known as financial credits), etc. Thus, the strategic decisions are highly influenced by the working capital which makes equilibrium between liquidity and profitability. 

  • Cash flow management

When an organization strikes a perfect balance between liquidity and financial cost, then it is referred to as cash flow management. The finance manager must adopt such financial policies due to which the financial cost will reduce and the organization leads profits. It was also seen that several multinationals, as well as small companies, struggled to reduce their taxes. Thus, any organization when dealing with cash flow must take strategic decisions carefully. 

  • Managing growth and risks

It is very rightly said that business growth is very expensive in nature because it consumes capital which should be managed carefully. Investment of capital is a very high-risk appetite, thus, an organization must collect all the relevant information before making any investment. Therefore, the strategic decision must be taken carefully.  

Need of financial strategy in the non-profit organization

As a profit-making organization, the non-profit organization must be financially secured and stable for meeting its goals and objectives. But, unlike a profit-making organization, the non-profit organization doesn’t have a mission to make any kind of profitable business. They tried to be financially stable for providing social and community-based goods and services which is an altruistic need of an organization. They also seek donations to achieve their goals and thus, they need a financial strategy for making a successful delivery of societal goods and benefits to the underprivileged.

While approaching financial strategic management, they will provide clear guidance for decision making in respect of which business activity will be prioritized for making any welfare charity. However, they not only assist in the decision-making process for the company’s target but also create a platform for planning and tackling the hurdles along their way. 

Financial strategy maximizes an organization’s market value and due to which the long term and the short term goals of an organization get accomplished. It also ensures proper guidance in respect of financial decisions, investment decisions, and cash flow management, etc.

Financial strategy for a non-profit organization

To get success, both profit and non-profit organizations must require an effective financial strategy. Perhaps, both organizations have different approaches but, both need financial stability for operational activities in the organization.  Thus, a non-profit cannot ignore some essential elements which maintain financial stability in the organization. Thus, the elements for a financial strategy for non-profit organizations are:

  • Set a budget according to previous year data and performance as well as future goals 

Budgeting matters a lot because it provides financial information which supports future planning. Several organizations make default in budget planning because they overrate their potential for fundraising and underrate their non-profit expenses.  

To prevent these problems, the budget should be set under previous year data and past performance as well as future goals because it gives clear guidance during formulating a budget.

  • Consider overhead expenses while formulating goals and objectives

Mostly, individuals who worked for non-profit organizations ignored overhead expenses. It seems overhead expenses lead to cost-cutting in their mission. They usually give uttermost importance to their mission that is providing societal products and services to the underprivileged or welfare of society. But the overhead expenses are also an important factor for the growth of an organization. An overhead expense includes employee expenses and office expenses. 

Also, an organization must take an appropriate approach for striking a perfect balance between overhead expenses and raising funds for the welfare mission.

  • Rely on and create an organized system

For any successful non-profit organization, there should be effective organizational techniques. If an organization has organized financial data, then it will be easy for them to stick to their financial plan as well as easy to execute the same. 

The organization may also ensure that the data shall be secured safely and it will get easily accessible. Thus, it is necessary to store the data in software and it must be regularly monitored to avoid any mischief. 

  • Making an effective decision

The non-profit organization thinks that its missions are not affected by economic turmoil, but, this doesn’t happen. They may get affected and to avoid the circumstances, the non-profit always seeks consultancy with professional accountants. The professional accountant of our organization helps in making an informed decision and they also advised us on;

  1. Best pace for allocation of funds in the economic turmoil;
  2. Whether an organization is financially capable or not to make funds for a large welfare campaign; and
  3. The type of campaign is suitable for an organization, etc.
  • Making transparency with donors

The donors have the right to get a piece of appropriate information regarding the funding of a non-profit organization because of the amount which they donated as a result of their hard work. Therefore, the organization must be financially transparent with its financial strategy in front of donors or supporters.

If the organization makes an inappropriate statement regarding the campaign, then it will lead to an adverse impact on their goodwill.  Also, it makes them financially weak and it leads to the non-fulfilment of their welfare campaign. Thus, financial transparency with donors and supporters is very important for the growth and development of an organization as well as for the organization’s mission. 

Financial strategies to increase non -profit funding

Asking for a donation is one of the difficult aspects for the non-profit organization, but it is an important need also. Undoubtedly, it is a big challenge but it can be resolved by adopting a financial strategy and standing fast thereto on the plan. 

  • Step 1

At the very initial stage, the organization has to appoint one financial coordinator who assesses all the financial work and has control over the funds raised from donors and supporters. 

  • Step 2

The finance committee has to be introduced within the organization that keeps an eye on the activity of the financial coordinator as well as look into the financial matters of the company.

  • Step 3

Setup parameters for the usage of the fundraised. Committee of senior staff or volunteers or employees may together develop a creative idea for the campaign or charity by those funds.

  • Step 4

Establish an association with government projects, NGOs, charitable trusts, etc. for the contribution of their funds raised by the donations. It also gives a clear view or transparency to donors and supporters in respect to where their money gets contributed. 

  • Step 5

The organization needs to identify the fundraising method for the upcoming year. The method includes a donation, grants, crowd-funding, events, sales, membership, and sponsorship (community-based partnership). 

  • Step 6

Set a timeline for receiving the donations.

  • Step 7

The organization should have an effective administrative system that records all credit and debts of the business.  Also, the system should be regularly monitored. 

For example, after every fundraising or at once a month check the transactional activities. 

  • Step 8

Say always thanks to donors and supporters as well as acknowledge the CEO, Directors, and Chairpersons in the social events of the organization, in the newsletters, in the advertisement, etc. 

  • Step 9

At the end of every financial year taking the review and suggestions from the donors, supporters, CEO, Board members, etc. on the matter of what the organization did in the previous year? What kind of improvement is needed in the organizational activities? And what organization has to do in the upcoming year?

Golden rules for fundraising in a non-profit organization

Fundraising is one of the most important aspects of the growth of a non-profit organization. As such, this is not an easy task because no one donates their hard-earned money to an unknown organization. Fundraising is the most important source for the non-profit organization for contributing to any welfare campaign and charity, etc. Thus, it is a very crucial aspect for the management to introduce themselves in front of donors for their successful fundraising. To accomplish this fundraising goal, the organization has to adopt some rules which are particularly known as Golden Rules for fundraising in a non-profit organization. These rules are:

  • Know your donors

To know the donors very well is the most urgent aspect for the organization. The contributing habits to donate and the nature of the donor help us for effective communication with them. 

  • Educate the donors

The organization must ensure that they educate their donors as well as supporters regarding their contribution to the social need. It seems to be true that an educated donor will be a happy donor because it builds trust which helps them to donate money to your organization. 

The donors can be educated and be aware by sending brochures and testimonials of an organization as well as past performance records, etc. 

  • Help donors by fulfilling their personal needs

The donors eagerly come to donate their money when their fulfilment gets accomplished due to their support of your cause. Everyone wants their personal benefit even if they are doing any charity work. Thus, if your organization ensures them that they will get personal benefit on their support. 

  • Build a healthier and trustier relationship with donors

The organization must have to build a healthier and trustier relationship with donors and supporters because they are the primary sources of raising funds. Be honest and transparent with the donors and supporters. They never create a feeling of deception or cheating due to any kind of confidentiality by your end. 

  • Respect the donor’s emotions

This factor is very important because if you do not respect your donors then it will cause you a huge setback. If the organization wants their donors to donate for the long term, then it is necessary to respect their emotions and value to them. 

Conclusion

In the concluding statement, we can say that financial stability is the uttermost important aspect for profit, as non-profit organizations irrespective of their goals and objectives are different from each other. For survival, the non-profit organization has to raise funds and strike a balance between the growth of the organization and contribution towards the welfare program. 

It is also clear that the main source of fundraising in non-profit organizations is donors and supporters. Thus, the organization must be financially transparent regarding its financial strategy and be honest with them. Also, the organization needs to make donors and supporters happy with your performance and always respect them because it will build the brand image of an organization as well as new supporters will join your campaign. 

Therefore, to achieve these goals, a proper strategic plan needs to be developed as well as implemented within the organization for better growth.

References


Students of Lawsikho courses regularly produce writing assignments and work on practical exercises as a part of their coursework and develop themselves in real-life practical skills.

LawSikho has created a telegram group for exchanging legal knowledge, referrals, and various opportunities. You can click on this link and join:

Follow us on Instagram and subscribe to our YouTube channel for more amazing legal content.

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