20 Feb 2017

Lawyer not liable for 'professional misconduct' unless 'gross negligence': Supreme Court

Holding that 'human errors' are possible even by lawyers, the Supreme Court in a recent decision has declared that a lawyer cannot be hauled up for professional misconduct only on account of negligence unless it is shown that the error was a 'gross negligence' in his actions. While acknowleding that "nobility, sanctity and ethicality of the profession has to be kept uppermost in the mind of an Advocate", the Supreme Court declared the legal position on the yard-stick to be followed for adjudging the actions of a lawyer and whether they were beyond the permissible boundaries. 

In its decision entitled T.A. Kathiru Kunju v. Jacob Mathai - Civil Appeal No. 3860 of 2007, decision dated 16.02.2017 the Supreme Court was dealing with the correctness of the action taken by the Bar Council (the regulatory body of lawyers in India) in holding a lawyer"guilty of gross negligence in discharge of his professional service to the client and accordingly imposed the punishment of reprimand" and a fine. The facts leading to this punishment were that the lawyer did not proceed with the suggested course of action required by the client in prosecuting a debtor for default. Apparently the lawyer also lost a crucial piece of evidence given to his custody by his client. The lawyer challenged the guilty verdict of the Bar Council before the Supreme Court which accepted the challenge. 

The Supreme Court gave the following reasons in support of its ruling;
"10. On a plain reading of the aforesaid provision, it is clear as crystal what punishment is to be imposed in case of misconduct. In the case at hand, as we find, that a conclusion has been arrived at by the Disciplinary Authority that it is a case of gross negligence at the hands of the appellant. As urged by Mr. Parikh, it is only required to be seen whether it is a mere negligence or gross negligence.  
11. The Constitution Bench, in the matter of Mr. 'P' an Advocate, (supra) has ruled that mere negligence or error of judgment on the part of an advocate would not amount to professional misconduct. It has been further held therein that error of judgment cannot be completely eliminated in all human affairs and mere negligence may not necessarily show that the advocate who is guilty of it can be charged with misconduct. The Constitution Bench, as is demonstrable, has drawn a distinction between 'negligence' and the 'gross negligence'. We think it appropriate to reproduce the said passage. It is as follows:- 
“But different considerations arise where the negligence of the Advocate is gross. It may be that before condemning an Advocate for misconduct, courts are inclined to examine the question as to whether such gross negligence involves moral turpitude or delinquency. In dealing with this aspect of the matter, however, it is of utmost importance to remember that the expression "moral turpitude or delinquency" is not to receive a narrow construction. Wherever conduct proved against an Advocate is contrary to honesty, or opposed to good morals, or is unethical, it may be safely held that it involves moral turpitude. A willful and callous disregard for the interests of the client may, in a proper case, be characterised as conduct unbefitting an Advocate. In dealing with matters of professional propriety, we cannot ignore the fact that the profession of law is an honourable profession and it occupies a place of pride in the liberal professions of the country. Any conduct which makes a person unworthy to belong to the noble fraternity of lawyers or makes an Advocate unfit to be entrusted with the responsible task of looking after the interests of the litigant, must be regarded as conduct involving moral turpitude. The Advocates-on-record like the other members of the Bar Advocates are Officers of the Court and the purity of the administration of justice depends as much on the integrity of the Judges as on the honesty of the Bar. That is why in dealing with the question as to whether an Advocate has rendered himself unfit to belong to the brotherhood at the Bar, the expression "moral turpitude or delinquency" is not to be construed in an unduly narrow and restricted sense.”  
12. On a careful reading of the aforesaid passage, it is quite clear that concept of “gross negligence” cannot be construed in a narrow or a restricted sense. It is because honesty of an Advocate is extremely significant. The conduct of an Advocate has to be worthy so that he can be called as a member of the noble fraternity of lawyers. It is his obligation to look after the interest of the litigant when is entrusted with the responsible task in trust. An Advocate has to bear in mind that the profession of law is a noble one. In this regard, we may fruitfully refer to what has been stated in Sanjiv Datta Dy. Secy. Ministry of Information & Broadcasting, In re.:- 
“The legal profession is a solemn and serious occupation. It is a noble calling and all those who belong to it are its honourable members. Although the entry to the profession can be had by acquiring merely the qualification of technical competence, the honour as a professional has to be maintained by its members by their exemplary conduct both in and outside the court. The legal profession is different from other professions in that what the lawyers do, affects not only an individual but the administration of justice which is the foundation of the civilised society. Both as a leading member of the intelligentsia of the society and as a responsible citizen, the lawyer has to conduct himself as a model for others both in his professional and in his private and public life. The society has a right to expect of him such ideal behaviour. It must not be forgotten that the legal profession has always been held in high esteem and its members have played an enviable role in public life. The regard for the legal and judicial systems in this country is in no small measure due to the tireless role played by the stalwarts in the profession to strengthen them. They took their profession seriously and practised it with dignity, deference and devotion. If the profession is to survive, the judicial system has to be vitalised. No service will be too small in making the system efficient, effective and credible.” 
13. Slightly recently in Dhanraj Singh Choudhary v. National Vishwakarma, it has been observed:- 
“The legal profession is a noble profession. It is not a business or a trade. A person practising law has to practise in the spirit of honesty and not in the spirit of mischief-making or money-getting. An advocate’s attitude towards and dealings with his client have to be scrupulously honest and fair.” 
14. There can be no doubt that nobility, sanctity and ethicality of the profession has to be kept uppermost in the mind of an Advocate. Keeping that primary principle in view, his conduct has to be weighed. There the approach of appreciating the evidence brought on record and the yardstick to be applied, become quite relevant. A three-Judge Bench in P.D Khandekar (supra) while dealing with the scope of an appeal preferred under Section 38 of the Act, ruled that in an appeal under Section 38, this Court in a general rule, cannot interfere with the concurrent finding of fact by the Disciplinary Committee of the Bar Council of India and the State Bar Council unless the finding is based on no evidence or it proceeds on mere conjectures and surmises. The Court has further laid down that finding in such disciplinary proceedings must be sustained by a higher degree of proof than that required in civil suits, yet falling short of the proof required to sustain a conviction in a criminal prosecution; and there should be convincing preponderance of evidence. We must immediately note with profit that the said principle is absolutely significant. The Court has stressed upon the rule to be applied for acceptance or treating the finding defensible by the Disciplinary Committee of Bar Council. In this regard it is fruitful to reproduce the following passage from the said authority:- 
“There is a world of difference between the giving of improper legal advice and the giving of wrong legal advice. Mere negligence unaccompanied by any moral delinquency on the part of a legal practitioner in the exercise of his profession does not amount to professional misconduct. In re A Vakil, Coutts Trotter, C.J. followed the decision in re G. Mayor Cooke and said that: 
"Negligence by itself is not professional misconduct; into that offence there must enter the element of moral delinquency. Of that there is no suggestion here, and we are therefore able to say that there is no case to investigate, and that no reflection adverse to his professional honour rests upon Mr. M.', The decision was followed by the Calcutta High Court in re An Advocate, and by the Allahabad High Court in the matter of An Advocate of Agra and by this court in the matter of P. An Advocate. 
The decision was followed by the Calcutta High Court In re An Advocate [AIR 1955 CAL 484], and by the Allahabad High Court In the matter of An Advocate of Agra [AIR 1940 All 289] and by this Court In the matter of P. An Advocate [AIR 1934 Rang 33]” 
17. On a studied scrutiny of the evidence in this context, the factual score, the act of the present appellant cannot be treated to be in the realm of gross negligence. It would be only one of negligence. The tenor of the impugned order, as we notice, puts the blame on the appellant on the foundation that he had not received the acknowledgment. He has offered an explanation that he had given the cheque to the police. There has been no delineation in that regard. That apart, there is no clear cut analysis on deliberation on gross negligence by the advocate. The Disciplinary Committee found the appellant guilty of gross-negligence as he had failed to get the acknowledgment from the complainant-respondent. The examples given by the Constitution Bench are of different nature. In the obtaining factual matrix, therefore, we are unable to accept the conclusion arrived at by the Disciplinary Authority of the Bar Council of India that the negligence is gross. Hence we are impelled not to accept the submission advanced by learned counsel for the respondent. 
18. Thus analysed, we are disposed to allow the appeal and accordingly, we so direct and the order passed by the Disciplinary Committee of the Bar Council of India is set aside. ..." 

11 Feb 2017

No liquor bar near National or State Highways : Supreme Court

Taking note of the "alarming statistics on the occurrence of road accidents" which "have claimed human lives and caused debility and injury". In particular taking stock of the alarming number of accidents on the rise and the policy adopted by the Union government, the Supreme Court in its judgment in State of Tamil Nadu v. K. Balu [Civil Appeal No. 12164/2016, decision dated 15.12.2016] rued that "India has a high rate of road accidents and fatal road accidents – one of the advisories states that it is the highest in the world with an accident occurring every four minutes". The Supreme Court noted, amongst others, the followings reasons requiring it to pass judicial orders into an issue which is basically within the realm of the executive;
"10. ... Human life is precious. As the road network expands in India, road infrastructure being an integral part of economic development, accidents profoundly impact on the life of the common citizen. For a nation on the cusp of economic development, India can well avoid the tag of being the accident capital of the world. Our highways are expanding, as are the expressways. They provide seamless connectivity and unheralded opportunities for the growth of trade and industry and for the movement of goods, persons and capital. They are the backbone of the freedom of trade and commerce guaranteed by Article 301 of the Constitution. Our highways are dotted with sign boards warning of the dangers of combining speed and alcohol. Together, they constitute a heady cocktail. The availability of liquor along the highways is an opportunity to consume. Easy access to liquor shops allows for drivers of vehicles to partake in alcohol, in callous disregard to their own safety and the safety of others. The advisories of the Union government to the states are founded on a logical and sound rationale.
11. We are conscious of the fact that the policy of the Union government to discontinue liquor vends on national highways may not eliminate drunken driving completely. A driver of a motor vehicle can acquire liquor even before the commencement of a journey or, during a journey at a place other than a national or state highway. The law on preventing drunken driving also requires proper enforcement. Having said this, the court must accept the policy of the Union government for more than one reason. First and foremost, it is trite law that in matters of policy, in this case a policy on safety, the court will defer to and accept a considered view formed by an expert body. Second as we have seen, this view of the Union government is based on statistics and data which make out a consistent pattern year after year. Third the existence of liquor vends on highways presents a potent source for easy availability of alcohol. The existence of liquor vends; advertisements and sign boards drawing attention to the availability of liquor coupled with the arduous drives particularly in heavy vehicles makes it abundantly necessary to enforce the policy of the Union government to safeguard human life. In doing so, the court does not fashion its own policy but enforces the right to life under Article 21 of the Constitution based on the considered view of expert bodies."
Taking note of the aforesaid position, the Supreme Court went on to declare that the prohibition under the Central Government guidelines should extend to all national and state highways. The relevant considerations were culled out by the Court in the following terms;
"20 For the reasons that we have already indicted, we have come to the conclusion that the views of the High Court of Madras and the High Court of Punjab and Haryana are unexceptionable. No distinction can be made between national and state highways in regard to the location of liquor shops. In regulating the use of national and state highways, the safety of the users of the road is of paramount concern. It would defy common sense to prohibit liquor shops along national highways while permitting them on state highways. Drunken driving as a menace and as a cause of road accidents is a phenomenon common to both national and state highways. Nor, is it a plausible defence to urge that while it is impermissible to drink and drive on a national highway, it is permissible to do so on a state highway. 
21 Moreover, we find merit in the restrictions suggested by the Punjab and Haryana High Court that the prohibition should extend not merely to the national and state highways but must be so appropriately tailored so as to ensure that the policy is not defeated by locating liquor shops in close proximity of the highway. A restriction that the shop should not be accessible or visible from the national or state highways or from a service lane along such highways is necessary to ensure that the policy is not surreptitiously violated. Our attention has been drawn during the course of the hearing to a report filed by the OSD Vigilance before the High Court indicating that the prohibition was sought to be defeated by setting up liquor vends which, though not visible from the highway, were situated in close proximity with signboards indicating their presence. The entry to the shop is camouflaged or placed at the rear portion to evade the judicial direction. ... Though, NHAI has sought the removal of these shops, “concrete action” is yet to be taken due to the lack of support from various quarters. Liquor shops, the Project Director notes, are owned by influential people making the removal of unauthorised encroachment impossible without the support of the district administration.
22 For all these reasons, we have come to the conclusion that no licences for liquor shops should be allowed both on the national and state highways. Moreover, in order to ensure that this provision is not defeated by the adoption of subterfuge, it would be necessary to direct that no exception can be carved out for the grant of liquor licences in respect of those stretches of the national or state highways which pass through the limits of any municipality corporation, city, town or local authority. Necessary safeguards must be introduced to ensure that liquor vends are not visible or directly accessible from the highway within a stipulated distance of 500 metres form the outer edge of the highway, or from a service lane along the highway.
In this background the Supreme Court passed inter alia the following directions;
(i) All states and union territories shall forthwith cease and desist from granting licences for the sale of liquor along national and state highways;
(ii) The prohibition contained in (i) above shall extend to and include stretches of such highways which fall within the limits of a municipal corporation, city, town or local authority;
(iii) The existing licences which have already been renewed prior to the date of this order shall continue until the term of the licence expires but no later than 1 April 2017;
(iv) All signages and advertisements of the availability of liquor shall be prohibited and existing ones removed forthwith both on national and state highways;
(v) No shop for the sale of liquor shall be (i) visible from a national or state highway; (ii) directly accessible from a national or state highway and (iii) situated within a distance of 500 metres of the outer edge of the national or state highway or of a service lane along the highway.
(vi) All States and Union territories are mandated to strictly enforce the above directions. The Chief Secretaries and Directors General of Police shall within one month chalk out a plan for enforcement in consultation with the state revenue and home departments. Responsibility shall be assigned inter alia to District Collectors and Superintendents of Police and other competent authorities. Compliance shall be strictly monitored by calling for fortnightly reports on action taken.
(vii) These directions issue under Article 142 of the Constitution.
We hope that this would in some way curb the menace of drunken driving and its fallouts.

No encroachment on public roads, even for religious reasons: High Court

In an earlier post of 2009 we had covered a direction passed by the Supreme Court to the effect that no construction of temples could be made on public roads. We had also covered in 2010 a decision of the Kerala High Court that there could not be any public meetings on roads as it creates inconvenience to public at large. It appears that there is no effect of such directions being passed on the common folk. In this post we are covering a decision of the Allahabad High Court which again emphasizes this point to hold that even for religious reasons there can be no encroachment on public roads. 

The case of Luvkuch v. State of Uttar Pradesh [Misc. Bench No. 13474/2016, decision dated 03.06.2016][AIR 2016 All 220] came up before the High Court on account of the complaint of local residents of the State against those "encroaching upon a public pathway by raising construction of a religious structure (Temple) and attempting to encroach upon the public land". They submitted that "people of this Country are basically simple and have faith in one or the other religion" and they are "normally soft whenever any religious activity is undertaken, even if it causes inconvenience of any kind to them". It was on account of this tendency of theirs, it was argued, that others took "advantage of such religious sentiments normally shown by majority of people" and such "scrupulous people do not hesitate in gross misuse by proceeding to encroach upon public land causing obstruction in smooth movement of public." Their argument was noted by the High Court in the following terms;
"3. ... Many a times, we have seen that in the garb of constructing religious structures, like Temple, Mazar, Samadhi, Mosque, Gurudwara, Church etc., public roads (including highways), streets, pathways etc. are encroached upon, obstructing or creating hindrance in smooth movement of public including vehicular traffic and once such structure is raised, due to fear of adverse consequences, people normally avoid to complain, and used to adjust such misuse. It is submitted by learned counsel for petitioners that authorities in power, who under the statute, are responsible to prevent such encroachment and illegal constructions also play soft and do not take or hesitate in taking action for preventing such activities and this is causing mushroom growth of such structures by encroaching upon public roads (including highways), streets, pathways etc. ..."
The Government lawyer accepted that "such encroachment and illegal constructions, neither in law nor otherwise can be allowed" but also submitted that it was "looking to religious sentiments of people" that "authorities find it difficult to take actual action." Taking note of the position, the High Court passed the following order;
"6. There is no fundamental or legal right to encroach upon a public road (including highway), street etc. and raise construction of any kind thereon. These unauthorised and illegal activities cause hindrance and interruption in free flow and movement of traffic including foot walkers. Every citizen has a fundamental right of movement and this cannot be allowed to be infringed by a few violators in public and apathy of State authorities. In our view, those who create such obstructions as also those who perpetuate it by taking care/ managing such structures and also those who fail to take any action in law, all deserve to be taken to task and make responsible and accountable for their respective misdeeds.
7. Looking to the wider perspective of the issue and widespread tendency of such encroachment in the name of religion, faith, sect etc., we find that the State Government and Officials must be asked to act and show response in an effective manner."
In this background the High Court passed the following directions to all State authorities;
(i) State of U.P. through Chief Secretary, U.P. is directed to issue a general direction to all Collectors and Senior Superintendent of Police/Superintendent of Police including the Officers responsible for maintenance of roads including highways) in State of U.P. to ensure that no religious structure in any form, whatsoever, shall be allowed / permitted to be raised on public road (including highways), street, pathway, lane etc. including sideways which is part and parcel of road (including highways) etc. and belong to State.
(ii) If any such structure is existing and has been raised in the last five years, to be more precise on and after 01.01.2011, the same shall be removed forthwith and a compliance report shall be submitted by Collectors etc. of concerned Districts to Principal Secretary/Secretary of concerned department, who shall submit a comprehensive report to the Chief Secretary within next two months.
(iii) If any such religious structure has been raised encroaching upon public road (including highways), street, lane etc., as stated above, before 01.01.2011, a Scheme shall be worked out and executed to shift the same to a private land offered by beneficiaries of such religious structures or persons responsible for its management or to remove it, within six months and a compliance report shall be submitted in the manner as said above in Direction No. (ii). 
(iv) On and after 10.06.2016, it shall be the responsibility of all Deputy Collectors/ Collectors in respective Sub-divisions and District as also Circle Officers and Superintendent of Police/Senior Superintendent of Police of concerned District including the Officers responsible for maintenance of roads (including highways) that no encroachment is made, by raising religious structures, by whatever name it is called, belong to any religion, creed, caste, sect, section etc., on public roads (including highways), streets, pathways, sideways, lanes etc. and if any deviation or disobedience is found, these Officers shall be personally responsible. This disobedience shall also be treated a deliberate and intentional disobedience to lower down authority of Court and would amount to criminal contempt.
(v) State Government is also directed to make out a plan so as to ensure that public roads (including highways), streets, pathways, sideways, lanes etc. are not obstructed creating hindrance in the smooth flow of traffic/movement of public on such roads (including highways) due to observance of religious activities and such activities are performed strictly at the places identified for the same or belong to concerned religious sections or at private place.
(vi) In the present case, District Magistrate is directed to take immediate steps and take appropriate action within two weeks.
While indeed the High Court has passed the directions calling upon the authorities to take action, one cannot rule out with certainty that such actions will not be repeated again. Land grabbing, albeit in the name of religion, is a common affair in the country and it will definitely take more than a mandamus to the authorities to act. The common folks must realise the importance of the issue and then only some improvement can be expected.

Tax also a part of discount given by seller: National Consumer Commission

In its decision in Aero Club (Woodland) versus Rakesh Sharma [Revision Petition No. 3477/2016, order dated 04.01.2017] the National Consumer Disputes Redressal Commission [decision courtesy www.livelaw.in] has directed that when a seller gives flat discount, that discount element also covers the tax part and the seller cannot charge additional tax over and above the discount. This can be understood by way of the example which is noted in the order;
"4. On 26.01.2016, the Complainant purchased a ‘GMT Men Jacket’ from Petitioner’s outlet. The MRP shown on the sticker was ₹3,995/-. After deducing ₹1,598/- as discount @40% and adding to the discounted price, VAT @ 5%, amounting to ₹119.85, the Complainant was asked to pay ₹2,517/- as cost for the said Jacket. Since the amount, so demanded, resulted in a discount less than “Flat” 40% of the stated MRP, the Complainant protested. His complaint was rejected by the Petitioner on the ground that as per the terms and conditions (T & C) of the SALE, VAT had been charged extra as per the instructions of the parent company. Realizing that by advertising at large that the items in the store were being offered at a “FLAT” 40% discount, which in the final analysis was much less, the Consumers were being duped by the Petitioner by adopting such unfair trade practice, alleging deficiency in service on its part, the Complainant filed the Complaint..."
In other words, the seller gave a flat discount of 40% as promised on the MRP. However after giving the discount, the seller charged tax on the discounted price. In the version of the buyer the discounted price should have included tax and tax could not have been charged after giving the discount as it was a 'flat 40% discount on MRP'. The seller refused and this led to the dispute. Accepting the version of the buyer, the Commission declared the practice of the seller as unfair.The legal position was set out by the Commission in the following terms;
13. Explanation to the clause, defining “bargaining price”, leaves little scope for doubt that the advertisement offering “FLAT* 40%’’ off on the select merchandise was the bargaining price within the meaning of clause (2) of Section 2 (r) of the Act. In our view, any person who sees the advertisement would reasonably understand that these items are being sold at “FLAT* 40%” discount. Although it is true that the word “FLAT” has an asterisk, appended to it, purporting to be a pointer to an annotation or footnote, but a bare comparison of the font size of “40%” and the font size of the corresponding terms and conditions mentioned in the footnote, clearly shows that the goods in question were not intended to be sold at a discount of FLAT 40%, the offered bargain price. ...
14. In our opinion, the advertisement in the above form is nothing but an allurement to gullible Consumers to buy the advertised merchandise at a cheaper bargain price, which itself was not intended to be the real “bargaining price” and, therefore, tantamounts to unfair trade practice, as found by both the Fora below. Significantly, under Section 2(d) of the Consumer Goods (Mandatory Printing of Cost of Production and Maximum Retail Price) Act, 2014, the “Maximum Retail Price” printed on the goods, a mandatory labelling requirement, at the relevant time, for pre-packaged goods, means “such price at which the consumer goods shall be sold in retail and such price shall include all taxes levied on the goods.” In that view of the matter, having seen the word “FLAT” in the advertisement, a consumer would be tempted to buy the goods under a bonafide belief that he would get a flat 40% off on the MRP. In our opinion, therefore, the defence of the Petitioners that they had charged VAT as per law is of no avail in so far as the issue at hand, viz. misleading advertisement, resulting in unfair trade practice, is concerned. We are in complete agreement with the Fora below that any discount falling short of “Flat 40%” on the MRP would amount to unfair trade practice, as defined in the Act.
This implies that when a seller gives a flat discount, the seller cannot charge additional tax above the discount. Such charge of additional tax would be a punishable act under the Consumer Protection Act, 1986, as the National Commission order declares.