Menu Close

Page 3 of 130

Equality Commission may not be sufficiently independent because of problems in appointments process

Alok Prasanna Kumar(With an anti-discrimination legislation back on the political agenda, Tarun Khaitan, an Associate Professor in the Faculty of Law at the University of Oxford and the Hackney Fellow in Law at Wadham College has responded with a draft Equality Bill, 2016. myLaw.net has invited some scholars and advocates to comment on this draft and over the coming weeks, will publish their responses here. We are quite excited to publish the first contribution to this debate from Alok Prasanna Kumar of the Vidhi Centre for Legal Policy, who has critiqued the appointment process for the proposed Equality Commission.)

In a nation riven by caste, class, religion, gender, tribal, and linguistic boundaries, (among many, many other lines of division) the idea of equality seems like a distant mirage. The Constitution of India, by stating a commitment to not just formal equality before law but also substantive equality in society, seems like a radical statement of intent, one whose realisation seems impossible on the face of it. Yet, attempts have been made, bit by bit, to remedy the worst of the iniquities and prejudices that mar Indian society but in the larger picture, seem too few and too far between.

In this scenario, Tarun Khaitan’s proposed Equality Bill (“the Bill”) must be seen as a bold attempt at working equality not just into our laws, but into the functioning of the State and its institutions and society as well. It is an effort to not just provide for remedies against violations of equal treatment under the law, but a comprehensive attempt to address discrimination and prejudice that runs deep in society. It is not just a comprehensive anti-discrimination bill, but also one that seeks to foster and further the goal of equality in society.

As others have focused on the intent and mechanism of the main parts of the Bill, I will focus here on the enforcement aspects of the Bill, specifically the Equality Commission (“the EC”). As clear as the norms are in any legislation, the success of the law as a whole will depend on the institutions that are tasked with its implementation. A law must be drafted with an understanding of the structural strengths and weaknesses of the institutions tasked with enforcement and to this end, there is room for improvement in the Bill.

The Bill’s enforcement mechanism has both proactive and reactive elements. This is not so easily split into the functions of the EC and the State Equality Commissions (“the SEC”) on the one hand, and the functions of the Equality Courts. This, I think is a problem with the Bill. For the purposes of this comment, whatever has been said about the Commission also applies to the State Equality Commission unless otherwise indicated.

Constitution of the Equality Commission

The EC has been created along the same lines as the National Human Rights Commission, the National Commission for Scheduled Castes, et al. It consists of a Chairperson and members who are either ex-officio members (or their representatives) or those selected for their commitment and expertise in fulfilling the Bill’s mandate. While there is some diversity mandated in the composition of the Commission, the appointment process leaves much to be desired.

The Bill replicates the appointments process in most other central legislation of having a high-powered committee comprising the Prime Minister, the Leader of Opposition in the Lok Sabha (“LOP”), the Chief Justice of India (“CJI”), and the Chairman of the University Grants Commission (“UGC”). While this committee is required to consult a group of authorities while making appointments, this process has two flaws, one minor and one major.

The minor flaw is that as a body of four persons, there is all likelihood of a deadlock. There being no “tie-breaker”, this could lead to a serious hold-up in appointments, especially if the “Government members” (the PM and the Chairperson, UGC) concur and the “non-Government members” (CJI and LOP) don’t. No procedure for decision has been prescribed and one has to assume (in light of the judgment in Centre for Public Interest Litigation v. Union of India) that this means a decision by majority has to be taken. While differences of opinion exist in such committees, there is potential for it to become a deadlock. This can be resolved either by increasing the number of members to five or by giving one person the casting vote in case of a tie.

Appointments process is too centralised

The major flaw is that this replicates the appointment process that has led to the massive centralisation of the appointment process and a consequent delay in appointments. By my rough estimate, no fewer than seven other laws have more or less the same composition of appointment committee. To overburden the same authorities with more and more appointments (between six to ten in this case), involving a detailed consultation procedure, may not make for a swift and efficient appointment process. The fate of the Lokpal and the vacancies in the Central Information Commission are a reflection of this.

The consultation process too has its problems. Of the eleven persons who must be consulted, at least eight are appointed by the government itself and may not present a sufficient diversity of views on the matter. Moreover, these eight persons represent eight bodies that are also represented on the Commission. It is difficult to see what purpose this consultation will serve in getting a healthy diversity of views in appointment. It is also not clear why the President of the Supreme Court Bar Association (a purely private body representing one sub-set of lawyers) should be consulted when the Chairperson of the Bar Council of India is also being consulted. Likewise, the requirement to consult any two Vice-Chancellors may likely result in the government consulting only those Vice-Chancellors it has appointed.

Since the EC is a body empowered to take action against the government and its officers for failing to do their duty, one that is so controlled by the government in the manner in which it is constituted may not result in a sufficiently independent body that that carries out its functions in a robust manner. While there has to be some involvement of the government, it may make more sense to involve greater civil society participation and transparency in the process. A five-member body featuring a representative of the executive, legislature, judiciary and members of civil society unaffiliated with government would in my view make an adequate replacement to the present scheme. The process could also be made more transparent by requiring that members apply to be considered, interviews be conducted in an open manner, and decisions be made on clear criteria laid down by the appointing committee.

(Alok Prasanna Kumar is Senior Resident Fellow at Vidhi Centre for Legal Policy.)

Written by myLaw

Death and the special legislation – Why the CrPC’s death penalty safeguards should also be available when death is awarded under other laws

ProceduralLawOfTheDeathPenalty_RahulRamanApart from the Indian Penal Code, 1860, there are 23 statutes that prescribe the death penalty as a form of punishment in India. The Anti-Hijacking Act, 2016 is the most recent addition to this list.

The movement towards making the death penalty an exceptional punishment began in 1955, after the repeal of Section 367(5) of the Code of Criminal Procedure, 1898, which required courts to record reasons when deciding not to impose the death penalty. Several important substantive and procedural safeguards were then introduced by the legislature and the judiciary to ensure the fair administration of the death penalty.

When safeguards in the CrPC are not available

The Code of Criminal Procedure, 1973 (“CrPC) requires the court in Section 354(3) to record “special reasons” while awarding the death penalty. It also requires the obligatory confirmation of the death sentence by the High Court. There are however, quasi-judicial bodies with the power to award the death penalty, which are bound only by the procedures prescribed in their parent statutes and not the CrPC. Some of these statutes include the Air Force Act, 1950 (“Air Force Act”), the Assam Rifles Act, 2006, the Defence of India Act, 1971, and the Karnataka Control of Organised Crime Act, 1999. These statutes remain bound by the principles of natural justice (S.N. Mukherjee v. Union of India, 1990 AIR 1984).

An example of a quasi-judicial proceeding that does not follow the procedures contained in the CrPC is that of “court martial”, provided for in the Army Act, 1950, the Air Force Act, and the Navy Act, 1957. The rules of procedure to be followed during a court martial proceeding are prescribed in the respective statutes itself. These procedures do not provide for safeguards similar to those in the CrPC. For example, there is no statutory onus on the court to provide “special reasons” in a court martial proceeding.

In S.N. Mukherjee v. Union of India, among the other issues before a constitution bench of the Supreme Court, inter-alia, were whether reasons are required to be recorded at the stage of (i) recording of finding and sentence by the court-martial; (ii) confirmation of the findings and sentence of the court-martial; and (iii) consideration of post-confirmation petition.

With respect to the first issue, the Court noted that the court martial is not required to record reasons at the stage of recording of findings and sentence. Similar conclusions were reached regarding the second and third issues as well. While these observations were made in relation to the provisions of the Army Act, these observations would hold true for the other two statutes as well since the procedures for court martial are similar.

Relying on the SK Mukherjeee dicta, the Delhi High Court in Balwinder Singh v. Union of India, 64(1996) DLT 385, decided not to interfere with the findings of court martial on the ground of absence of any ‘special reasons’ but commuted the death sentence to imprisonment for life on other grounds.

The petitioner was charged under Section 69 of the Army Act for committing murder. The general court martial found the petitioner guilty and sentenced him to death. This was further confirmed by the Central Government. The petitioner had also exhausted the recourse available to him under Section 164(2) of the Act. Section 164(1) and (2) provide for a remedy against, inter alia, the sentence of a court martial. The aggrieved party can present a petition before the confirming authority, and after that, to the Central Government or the Chief of Army Staff.

The petitioner, therefore, filed a writ petition under Article 226 of the Constitution challenging the above orders, questioning among other things, the absence of “special reasons” in the order of the general court martial, as stipulated under Section 354(3) of the CrPC. The petitioner also raised an argument in the alternative that the requirement under Section 354(3) should be read as a part of natural justice requirements of Article 21 of the Constitution.

The court reiterated the position laid down in SN Mukherjee, and said that the general court martial did not commit any error by not recording any ‘special reasons’ in the case. Similarly, the Court interpreted Section 162 of the Army Act to excuse even the confirming authority from providing reasons while confirming the sentence of death. Regardless, the court observed that if there are any shortcomings in the findings of general court martial or the confirming authority, they could be challenged under Article 32 or Article 226 of the Constitution. The Court failed to make any observation on the argument regarding Article 21 of the Constitution; that giving “special reasons” is essential in a case where death sentence is to be awarded irrespective of the nature of the court or tribunal.

Similarly, Section 64 of the Border Security Force Act, 1968 provides for the establishment of special courts. The General Security Force Court is empowered to pass a sentence of death under Section 72. Chapter VII (Sections 82 to 106), which lays down the procedure for the courts under this Act, does not contain any special procedure (as contained in CrPC) with respect to death sentence. The only additional requirement for passing a death sentence is that it should be passed with a concurrence of at least two-third members of the court. Other decisions of the Court can be passed by an absolute majority. This kind of voting requirement is present in other statutes that stipulate for trial by court martial as well.

Most of the other non-IPC legislations that stipulate death penalty among its punishments follow the special procedures mentioned in the CrPC with respect to the death penalty. For example, under the Scheduled Castes and Scheduled Tribes (Prevention of Atrocities) Act, 1989, there is a provision in Section 14 for establishing a special court for trying of offences committed under the Act. However, this court is also bound by the procedures prescribed in the CrPC.

The incorporation of special provisions with respect to the death penalty in the CrPC signifies the legislature’s intent to include additional safeguards that aim at ensuring maximum protection to a person sentenced to death. Considering the general legislative and judicial caution against the death penalty, it is important that a larger bench of the Supreme Court revisit the findings in S.N. Mukherjee. The requirements of giving ‘special reasons’ and obligatory confirmation by the High Court should be made imperative, regardless of the statute under which a person has been sentenced to death.

(Rahul Raman is a Project Associate at the Centre on the Death Penalty, National Law University, Delhi.)

Written by myLaw

Open court hearings in review petitions after Mohd. Arif (2014)

SohamGoswami_DeathPenaltyProcedureThe Supreme Court of India has qualified the scope and extent of the right to life enshrined in Article 21, through a series of judgments from A.K. Gopalan v. State of Madras, AIR 1950 SC 27 to Maneka Gandhi v. Union of India, AIR 1978 SC 597, ensuring that infringements upon life and personal liberty may only be made through “fair, just and reasonable procedure”.

So what of the procedure extinguishing life from a person who has been found guilty of capital offences? There is a comprehensive procedure under Indian law to ensure that a person sentenced to death may be afforded the maximum opportunities to present his side of the case so that he can hopefully be acquitted or his sentence commuted. A Court of Sessions, which is the competent court to record evidence and convict the accused, must cite its reasons in writing (Section 367 of the Code of Criminal Procedure, 1973) for awarding the death sentence and must then submit that decision to the state’s High Court for confirmation (Section 366). The sentence is considered valid only after confirmation and the convict may (if the High Court certifies the case under Article 134 of the Constitution) move the Supreme Court. The convict has a right of appeal if the High Court has either (a) overturned an acquittal or lesser conviction by the Court of Sessions and awarded the death sentence or (b) withdrawn proceedings before the Court of Sessions and conducted the same in the High Court.

The Supreme Court’s review jurisdiction

Under Article 137 of the Constitution, the Court may review cases decided by them. Order XL of the Supreme Court Rules, 1966 further require review to be done in chambers (that is, by judges, conferring amongst themselves without the assistance of counsel) and based on written pleadings made by counsel.

The Supreme Court in P.N. Eswara Iyer v. Registrar, Supreme Court of India, AIR 1980 SC 808, upheld the constitutional validity of Order XL, Rule 2 (requiring review in chambers), citing the heavy burden upon the Supreme Court to hear oral arguments in all cases within its jurisdiction.

The Supreme Court however, in Mohd. Arif v. Registrar, Supreme Court of India and Others, (2014) 9 SCC 737, dealt with the question of whether death sentence cases would form a class by themselves, meriting separate treatment.

The disagreement in Mohd. Arif

Writing for the majority, Justice Rohinton F. Nariman held that due to the nature of the death penalty, where:

1. the punishment is irreversible, and

2. due to lack of sentencing guidelines, it is left to various judges as to the quantum of sentence to be awarded (for instance, one judge might award the death sentence in a certain case, while another judge might sentence someone to life imprisonment for the same offence and same circumstances), sentencing was often arbitrary;

the highest standard of scrutiny was required in such cases.

Justice Rohinton F. Nariman interpreted Justice V.R. Krishna Iyer’s (the author in P.N. Eswara Iyer) ruling as allowing for such cases to be heard orally in open court. He quotes paragraph 29A of P.N. Eswara Iyer “…indeed, there is no judicial cry for extinguishment of oral argument altogether.”

However, Justice Chelameswar dissented, holding that the question of arbitrary sentencing did not arise as the same judges of the Supreme Court who passed the original judgment were required to sit on the review bench.

However, Mohd. Arif (the lead petitioner) was denied the opportunity to file a review petition himself. This was because he had already submitted a curative petition (the last option in the Supreme Court) and the Court held that to grant him a review petition now would infinitely delay the process. The review petition is filed and admittedor dismissed prior to the curative petition.

Eventually, a Constitution Bench of the Supreme Court on January 19, 2016 allowed Arif to re-open his review petition on the ground that he would be the only person not receiving the benefit of a review petition, which would be unfair to him; further, the dismissal of the curative petition should not preclude the petitioner from receiving the benefit of a review petition in open court, no matter how slim the chance of success may be.

As one can see upon perusal of the judgment in Mohd. Arif, the purpose was to ensure that, no matter how slim, people receiving the death sentence should be given as many opportunities as permissible under the law for evidence to be re-appreciated. However, the problem that is apparent from the dissent of Justice Chelameswar is that ordinarily, the same Bench hearing the original case on merits deals with the review petition (unless any of the judges retire). It is unlikely therefore, that they would change their opinion on whether the convict should receive the death penalty; thus, the purpose of the review petition is not realised.

The purpose of the review bench, as is evident from Order XL of the Supreme Court Rules, is to merely check whether there is an error apparent on the face of the record. The composition of the bench should therefore, not matter, as the matter for appraisal should not lead to different conclusions. At the same time, the same judges having already looked into the matter once, would ordinarily not be willing to sit and review the whole case again.
Mohd. Arif is however, a pathbreaking judgment given its implications for prisoners on death row—that at the penultimate stage of proceedings at the Supreme Court, they are entitled to an open court hearing and reappreciation of evidence in their case argued by their lawyer. It remains to be seen, however, the manner in which Supreme Court deals with these petitions.

 

(Soham Goswami, currently in the third year at ILS Law College, Pune, is an intern at the Centre on the Death Penalty. The views expressed in this article are his alone.)

Written by myLaw

[Video] How can a junior advocate assist better during arguments?

For up to a few years after they enter the profession, advocates can find themselves assisting their more senior colleagues in court. What is the role of an assisting counsel and how can a junior advocate excel in that role? These are questions that naturally occur to a junior advocate but unfortunately, only experience and corridor conversations seem to present any answers.

We felt that there was much to learn from the experiences of others and so we put these questions to a number of young Delhi-based litigators.

Watch what they had to say, in the video below.

Written by myLaw

[Video] Judicial pendency: What’s the big problem?

Why did the Chief Justice of India have a “breakdown” about the impossible burden facing the judiciary? Is the judiciary doing nothing about the massive backlog of pending cases at the courts? Are the courts really that slow in India? What is the problem, anyway? Will appointing new judges fix the problem? There are no simple, straightforward answers (or questions) when it comes to judicial pendency in India, but here is a video in which we have tried to make the issue much clearer.

Written by myLaw

FDI in e-commerce: Everything you need to know

DivyaSinha_SwethaPrashant_JSagarAssociatesThe Department of Industrial Policy and Promotion (“DIPP”) recently released Press Note No. 3 (2016 Series) dated March 29, 2016 (“PN3”), setting out guidelines for foreign direct investment (“FDI”) in the e-commerce space. We will look at the evolution of the law and policy on foreign investment in the e-commerce space, and in particular the scope and implications of PN3.

India’s FDI law

Foreign investment in India is governed by the Consolidated FDI Policy (“FDI Policy”) and the Foreign Exchange and Management Act, 1999 (“FEMA”) and related rules and regulations. The DIPP, which is the foreign investment regulatory arm of the Ministry of Commerce and Industry of the Government of India, makes amendments the FDI Policy by issuing press notes. Rules under the FEMA, however, are notified by the Reserve Bank of India (“RBI”).

FDI in e-commerce – the story before PN3

FDI has been permitted in the e-commerce space in a limited manner since the year 2000. According to Press Note No. 2 (2000 series) (“PN2”), FDI of up to 100 per cent was allowed in an e-commerce company under the automatic route (that is, without the approval of the government) as along as that company was engaged in business-to-business (“B2B”) e-commerce. If such a company was listed overseas however, 26 per cent stake in it had to be divested in favour of the Indian public within a period of five years. On the other hand, FDI was not permitted in retail trading, that is, in business-to-consumer (“B2C”) e-commerce. The policy had also categorically specified that the restrictions applicable (at that time) to domestic trading would be applicable to e-commerce as well.

On trading (including wholesale, single-brand retail, and multi-brand retail), the FDI Policy witnessed many changes since 2000, but in the e-commerce space it remained mostly stagnant until the end of 2015. Among minor changes made during this period, the requirement of mandatory disinvestment of 26 per cent stake in favour of the Indian public was dispensed with in 2006. “E-commerce” was also defined in the FDI Policy in 2010 to mean the activity of buying and selling by a company through an e-commerce platform.

B2BModelECommerce B2CModelECommerce

In 2014, the DIPP released a discussion paper seeking comments from various stakeholders for formulating the guidelines on FDI in the e-commerce sector. While it was still in the process of formulating the policy on FDI in B2B e-commerce, it released Press Note No. 12 (2015 series) (“PN12”), which liberalised the FDI Policy in the B2C e-commerce sector in a limited manner.

Shackles on single-brand B2C e-commerce

According to PN12, FDI in B2C e-commerce was permitted in ‘single-brand product retail trading’ as follows:

(a) single-brand retailers with physical stores were permitted to sell their products online as well; and

(b) Indian manufacturers were permitted to sell their own single-brand products online as along as the manufacturers are: (i) the investee companies (that is, those which have received FDI); and (ii) the owners of ‘Indian brands’ (that is, those that are owned by Indian residents or Indian companies owned and controlled by Indian residents); (iii) manufactured 70 per cent of the value of the products in-house; and (iv) sourced the remaining 30 per cent from other Indian manufacturers.

Single-brand retailers and Indian manufacturers with FDI who want to sell their single-brand products through e-commerce also need to comply with a few other conditions set out in PN12. Currently, FDI is permitted up to 100 per cent in Indian entities engaged in single-brand retail trading. FDI beyond 49 per cent requires government approval but below that threshold, it can be under the automatic route.

So far as multi-brand retail trading goes, FDI is permitted up to 51 per cent under the approval route subject to certain funding, sourcing, and other conditions. The FDI Policy on multi-brand retail e-commerce by Indian companies with FDI, however, did not change and the restriction continued by implication. Consequently, Indian companies with FDI who are engaged in multi-brand retail trade are not permitted to undertake B2C multi-brand e-commerce.

Several regulatory snarls and the litigation faced by e-commerce players during the last few years appear to have prompted the DIPP to clarify the FDI Policy on B2B e-commerce space through PN3.

PN3: Laying the boundaries for FDI in B2B e-commerce

As discussed above, FDI of up to 100 per cent was already allowed in B2B e-commerce under the automatic route (that is, without the approval of the government) since 2000. PN3, in addition to reiterating the FDI policy on B2B and B2C e-commerce that is currently in place, has distinguished two models of e-commerce – the “inventory based model” and the “marketplace based model”. It clearly states that FDI of up to 100 per cent will be allowed without any government approval only in “marketplace based models” and that FDI in “inventory based models” is prohibited.

PN3 has also redefined the term “e-commerce” and clearly defined the concept of “e-commerce entities”. It stipulates some operating conditions for e-commerce entities with FDI for undertaking “marketplace based” e-commerce retailing.

“E-commerce” and “e-commerce entities”

The term “e-commerce” has been redefined to mean the “buying and selling of both goods and services, including digital products over both digital as well as electronic network”. This is broader than the previous definition, which was restricted to the buying and selling of goods by a company on an e-commerce platform. The new definition covers services also and clarifies the forms of e-commerce platforms (such as computers, television channels, webpages, and mobiles).

The term “e-commerce entity” on the other hand, has been defined for the very first time. It includes Indian companies, foreign companies, and offices, branches, or agencies owned and controlled by non-residents, which conduct e-commerce business. As a result of this new definition, it is now clear that foreign companies can invest in “marketplace based” B2B e-commerce. This will also enable foreign investors to acquire existing Indian entities operating marketplace B2B e-commerce.

It is, however, interesting that the definition does not include limited liability partnerships (“LLPs”). On a plain reading, it appears that FDI will not be permitted in LLPs that undertake B2B e-commerce. This position, however, contradicts the FDI Policy on LLPs, which was recently amended in PN12 which allowed FDI up to 100 per cent in LLPs operating in sectors where 100 per cent FDI is permitted under the automatic route and where there are no performance-linked conditions. The DIPP should provide some clarity on this front as it could impact the structuring of FDI in the B2B e-commerce space.

“marketplace based” and “inventory based”

As FDI is permitted only in marketplace-based models, it is important to understand the difference between “marketplace based models” and “inventory based models”.

The “marketplace based model” of e-commerce is defined as the provision of an information technology platform by an e-commerce entity on a digital or electronic network. A marketplace-based e-commerce entity, PN3 clarifies, cannot own any inventory by itself. If any marketplace-based e-commerce entity with FDI gains ownership over such products and services, then it will be considered an inventory-based e-commerce entity. Therefore, at no point can a marketplace-based e-commerce entity gain ownership over the goods. The title to the goods and services should remain with the seller.

A marketplace-based model is essentially a B2B model where the e-commerce entity is merely acting as a facilitator between sellers and consumers. In this model, an e-commerce entity will not sell goods or provide services directly to the consumers. The actual sale of goods or services takes place between the seller and the end consumer. The e-commerce entity will earn a commission from the seller for the services provided by it to the seller.

FDI_ECommerce_B2BModel

The “inventory based model” on the other hand, has been defined as e-commerce activity where the inventory of goods and services is owned by the e-commerce entity and those goods and services are sold directly to the consumers. An inventory-based model, therefore, is essentially a B2C model where the e-commerce entity has ownership over the goods and the sale of goods and services takes place between the e-commerce entity and the end consumer.

As we discussed above, PN12 only permitted manufacturers and single-brand retailers to undertake B2C single brand retail trading through e-commerce. If an e-commerce entity with FDI undertakes the inventory-based model, then it could be considered to be undertaking (the currently prohibited) multi-brand retail trading e-commerce.

FDI_Ecommerce_B2CModel

One way to determine whether e-commerce entities are undertaking marketplace-based e-commerce is to examine the treatment of inventory or merchandise in their accounts. If they are accounting the merchandise or inventory in their own balance sheet, then they could be considered “inventory based models’ and will attract penal provisions of the applicable foreign exchange laws.

Operating guidelines for B2B e-commerce: Support functions, pricing of goods and services, and revenue generation

The DIPP has, for the first time, stipulated operating guidelines for marketplace-based e-commerce entities with FDI.

Support functions: E-commerce entities have been allowed to provide logistics, warehousing, order fulfilment, call center, payment collection, and other support functions to the sellers. These support services will allow e-commerce entities to generate revenues for themselves in addition to any commission or fee that may be charged from the seller. Leading e-commerce entities such as Amazon, Flipkart, Jabong, and Myntra provide warehousing services to sellers. As long as they are merely providing support functions to the sellers, they will not be in violation of the policy. PN3 also states that if e-commerce entities undertake payment collection, they should also ensure that their service is in conformity with the relevant RBI guidelines. These guidelines endorse the principles of a marketplace-based B2B model.

Pricing of goods and services: E-commerce entities cannot “directly or indirectly influence the sale price of goods or services” and are obligated to maintain a “level playing field”. This guideline has been seen as a measure to curb the predatory pricing tactics of e-commerce entities and to create a level playing field with offline traders. There have been allegations that leading e-commerce players, in order to attract customers on the platform, are using innovative methods to influence sellers to substantially mark down prices or provide deep discounts on their products and services. For example, some e-commerce entities such as Amazon refund the amount denoting discounts provided by the sellers on the platforms. Some e-commerce players like Patym provide cash back on the products purchased on the platform to the consumers. In a true marketplace-model however, sellers are in control of the pricing of the products and services, and any markdown or discounts on the maximum retail price on the platform are offered directly by the sellers. The e-commerce entity, which is merely a facilitator between the sellers and the consumers, does not influence the pricing of products and services offered by the sellers on the platform in any way.

While PN3 does not explain the parameters for determining “influence”, this guideline is expected to impact offline arrangements (such as the funding of discounts) between sellers and e-commerce entities as they may be considered to amount to influencing sale prices. Despite this regulation, many e-commerce websites continue to provide discounts and cash back offers. The pricing models adopted by sellers and e-commerce entities will need to be studied in greater depth to determine if e-commerce companies are in violation of this provision. The DIPP should clarify the intent of this provision to ensure that e-commerce companies with FDI are not violating this guideline.

Sourcing: E-commerce entities cannot derive more than 25 per cent sales on their platform from a single seller or any of the e-commerce entity’s group companies. This guideline is intended to ensure that e-commerce entities do not carry out B2C e-commerce in the garb of a marketplace model using convoluted business structures. This provision will definitely impact those e-commerce players who derive more than 25 per cent of their sales from their vendors or group companies. For instance, it is reported that both Flipkart and Amazon India generate sales beyond 25 per cent from their group companies, WS Retail Services Private Limited and Cloudtail India Private Limited, respectively. These e-commerce players will need to restructure their business models to toe the line with PN3. Further, there is no clarity on the duration for calculating the cap on sales, that is, whether this cap will be calculated on a financial year basis or otherwise. The DIPP should also clarify the intent of this provision to ensure that e-commerce companies with FDI are not violating this guideline.

Other conditions: The responsibility for the delivery of goods to the customer and customer satisfaction following a sale on the technology platform as well as providing any warranty or guarantee of goods and services lies with the seller. This guideline is in line with the principles of a marketplace-based model. If such responsibility lies with the e-commerce entity, then it will no longer be considered a mere facilitator, and any sale on its platform could take on the colour of B2C multi-brand e-commerce retail, which (as we have discussed previously) is currently prohibited, except for single-brand retailers and manufacturers.

The guideline on the delivery of goods by the seller, however, appears to contradict the guideline which allows e-commerce entities to provide support services to the sellers. This may be a drafting flaw, which the DIPP will need to clarify to ensure that e-commerce companies with FDI are not violating this guideline.

PN3 also states that e-commerce entities are permitted to enter into transactions with sellers registered on the platform on a B2B basis. This guideline is very ambiguous since it does not clarify what kind of B2B business e-commerce entities are expected to transact with sellers on. For example, if the sellers sell their goods to e-commerce entities, it would be considered as a B2B business since e-commerce entities are not the ultimate consumers. This would, however, violate the guideline that e-commerce entities gaining ownership over the goods will no longer be considered marketplace-based e-commerce entities. This ambiguity needs to be clarified by the DIPP.

Going forward – the search for a level playing field

The introduction of PN3 may encourage foreign investors, who may have been hesitant to enter this space till now due to a lack of regulatory clarity, to invest in the Indian e-commerce space. It also provides legitimacy to the existing businesses of e-commerce companies with FDI that have been operating on the marketplace model in India. E-commerce companies with FDI will definitely need to re-examine their business structures to ensure that they are in compliance with PN3.

Having said that PN3 may not really create a level playing field between e-commerce entities with FDI and e-commerce entities without FDI. PN3 could impact e-commerce companies that already have FDI or intend to raise FDI, but not e-commerce companies without FDI. While the FDI Policy will govern only those e-commerce companies with FDI, no similar restrictions apply to e-commerce companies without FDI under other laws. The latter category may, for instance, continue to provide deep discounts on similar products and services or generate revenues beyond 25 percent from a single vendor or group company. Further, there are no similar restrictions on offline retailers without FDI. The government, which is keen on attracting foreign investment in this sector, should re-examine this policy to ensure that the interests of both offline retailers as well as e-commerce entities are adequately protected. While PN3 is a good move, there is room for further fine-tuning a few aspects of the policy by the government, especially with respect to the pricing of products and services and limits on revenue generation.

Swetha Prashant is a Principal Associate at J. Sagar Associates. Divya Sinha is a Junior Associate at the same firm. The views expressed in this article do not represent the firm’s view in any manner.

Written by myLaw

Supervening circumstances and the commutation of a death sentence: A more definitive law from the Supreme Court

ProceduralLawOfTheDeathPenalty_RahulRamanIf the situation that prevailed at the time a sentence of death was delivered has changed, can the Supreme Court take those changed circumstances into account to commute a sentence of death? Less than two years ago, the Supreme Court in Shatrughan Chauhan v. Union of India, 2014 (3) SCC 1, looked into whether executing a death sentence notwithstanding the existence of such supervening circumstances would violate among other things, Article 21 of the Constitution. After weighing such circumstances in different petitions, it commuted the penalty of fifteen individuals to life imprisonment and laid down a more definitive law on the Court’s power of commutation.

The petitioners had claimed that the executive, while exercising its power under Articles 72 or 161, did not consider any supervening events. In a few previous decisions such as Triveniben (1989) and Jagdish v. State of Madhya Pradesh (2009), the Court had declared that it had a duty to protect a prisoner’s right to life till his last breath. This provided the Supreme Court with the legal basis to take supervening circumstances into consideration and those pleaded in Shatrughan Chauhan included delay, insanity, solitary confinement, and procedural lapses.

Delay in processing mercy petitions

The question of whether the executive’s delay in processing a mercy petition should be considered a supervening circumstance has troubled the Court for a long time. There is no stipulated time limit within which the executive has to dispose a mercy petition and often, there is inordinate delay.

Earlier, a division bench of the Supreme Court in T.V. Vatheeswaran v. State of Tamil Nadu, AIR 1983 SC 361, had held that a delay of two years in execution of a sentence after the judgment of the trial court would entitle the prisoner to plead for commutation of his sentence of death to life imprisonment. Soon after however, a three-judge bench in Sher Singh and Others v. Union of India, AIR 1983 SC 465, held that delay alone could not be a good enough ground for commutation of death sentence, and overruled the two-year delay rule. Nevertheless, this decision acknowledged a prisoner’s right to a fair procedure at all stages – trial, sentencing, and incarceration.

To resolve this apparent conflict, a constitution bench took up this issue in Triveniben v. State of Gujrat, 1988 (4) SCC 574. In a landmark verdict, the Court held that while an undue delay would entitle a punished individual to invoke Article 32, Vatheeswaran’s “two-year delay rule” was not correct.

The Court relied on this decision in Shatrughan Chauhan. It held that while considering the rejection of a clemency petition, the Court could not overlook the pain caused to the convict. Therefore, the Court was well within its judicial power under Article 21 read with Article 32 of the Constitution to hear a convict’s grievance and commute a death sentence to life imprisonment if it is found that that there had been undue, unexplained, and inordinate delay in execution due to the pendency of a mercy petition.

The Court decided not to lay down any compulsory period within which the President has to decide a mercy petition. While the Court would make such a determination on the facts and circumstances of individual cases, it suggested that the executive should itself weigh the aspect of delay while disposing of a mercy petition.

The Court also said that the decision of the Court in Devender Pal Singh Bhullar v. State (NCT) of Delhi, 2013 (6) SCC 195, which had disqualified cases under the Terrorist and Disruptive Activities (Prevention) Act, 1987 from scrutiny on account of delay, was per incuriam. Any person sentenced to death could avail “delay” as a supervening circumstance regardless of the offence and the statute under which he has been convicted. Later, the Supreme Court recognised this finding in Navneet Kaur v. State of NCT of Delhi, Curative Petition (Criminal) No. 88 of 2013 (Supreme Court) to commute Devender Pal Singh Bhullar’s death sentence to life imprisonment.

Insanity or mental illness

The next ground considered by the Court was that of “insanity” or “mental illness” as a supervening circumstance. The Court after referring to several international conventions like the International Covenant on Civil and Political Rights concluded that this was a valid supervening circumstance. It noted that once mental illness of the convicted individual is medically certified, executing him would be in violation of the international convention to which India was a party, and of Article 21 of the Constitution.

Solitary confinement

Despite underlining its own finding in Sunil Batra v. Delhi Administration and Others, 1978(4) SCC 494, the Supreme Court decided not to interfere on the ground of “solitary confinement” in Shatrughan Chauhan. Later however, the Allahabad High Court in People’s Union for Democratic Rights v. Union of India, 2015(2) ADJ 2015 and the Supreme Court in Ajay Kumar Pal v. Union of India, 2014(13) SCALE 762 held that “solitary confinement”, along with other factors, was a permissible supervening circumstance to commute death sentence to life imprisonment.

Procedural lapses

The final ground raised was that of “procedural lapses” made by the executive while disposing of mercy petitions. The Court held that the procedures prescribed for the Ministry of Home Affairs were a necessary requirement under Article 21 to treat the death row convicts fairly. It noted that the President should be provided with all the relevant material to assist him in disposing the mercy petitions. The concerned departments cannot give or seek piecemeal information regarding the petition to be decided. However, the scrutiny of a procedural anomaly would be done on a case-to-case basis.

The circumstances raised in Shatrughan Chauhan are not exhaustive. The addition (or removal) of supervening circumstances to this list would depend on the judicial attitudes to reconciling convict’s rights with those of the victim or the society. Further, despite the unambiguous decisions in Triveniben and Shatrughan Chauhan, it is entirely up to the Court to see on an individual basis, how to interpret ‘undue and unexplained’ delay and whether to permit it as a supervening circumstance.

(Rahul Raman is a Project Associate at the Centre on the Death Penalty, National Law University, Delhi.)

Written by myLaw

Sabarimala temple-entry controversy: Explained by myLaw

What is the #Sabarimala temple entry controversy all about? What are the legal and constitutional complications? Which fundamental rights are in conflict here? And how do we decide whose rights should prevail? We explored all these questions to give you a clearer picture. Watch below and don’t forget to let us know what you think.

Written by myLaw

Panama Papers: Explained by myLaw

We have been tracking the Panama Papers scandal with a lot of interest. The papers leaked to a German newspaper blew the lid wide open on thousands of offshore shell companies set up by Panamanian law firm Mossack Fonseca in tax havens around the world, implicating several politicians, heads of state, businessmen and celebrities from various countries. But where does India figure in all of this? What laws have the 500 Indians named in the documents allegedly broken? What could the consequences be? Amidst all of the noise and overwhelming amounts of information out there, join us as we make sense of it all and understand the Panama Papers from an Indian law perspective.

Written by myLaw

What to tell your clients and when – Learn the essential litigation skill of communicating with clients

An advocate’s career is not all about communicating an argument effectively with a judge or assisting a senior colleague. Building lasting relationships with clients is almost equally important. Since legal education, unfortunately, provides very little help in navigating this part of an advocate’s professional life, we asked a few experienced advocates whether they had any advice for young advocates who are commencing their professional journey. This is what they had to say.

 

Written by myLaw