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Apex Chamber of Industry and Commerce of NCT, Delhi Challenges Government Notification for hike in Minimum Wages.

The Delhi Government, by a notification dated 3rd March, 2017, cleared a significant 37% hike in minimum wages of workers in the State. An unskilled labourer will now be entitled to a minimum wage per month of Rs. 13,350/- from the earlier Rs. 9,724/-. Likewise, the minimum wage per month for semi-skilled workers would go up from Rs. 10,764/- to Rs. 14,698/- and from Rs. 11,830/- to Rs. 16,182/- for skilled labourers. The sole objective of the Government behind the scheme is to provide financial security to the impoverished, thus increasing their purchasing power, which in turn would stimulate growth in the trade and industry.

Apex Chamber of Commerce and Industry is the representative body for free industries in Delhi. It aims to facilitate the common interests of trade and industry for its members thereby creating a constructive trade and industrial relationship, competitive, transparent, free and fair environment for its members. The Apex Chamber in a letter to Lieutenant Governor opposed the figures proposed in the said order by Delhi Government.

While fixing the rate of minimum wages, the fundamental components that are taken into account include food, clothing, house, light, fuel and education. The Seventh Pay Commission has laid down 2700 calories per day for a workman who performs moderate activities. The representative body for trade and industry has stated that the minimum calorific value taken into consideration while calculating minimum wages was 3447 calories, which is much higher that the value fixed by the Seventh Pay Commission. It is also argued by the representative body that the legislative scheme under Section 9 of the Minimum Wages Act, 1948 has been completely violated in as much as it requires equal number of representation of employers and employees as well as independent persons not exceeding 1/3rd of its total members. In W.P. (C) 12088/2016, before the Hon’ble High Court of Delhi, in the matter of Apex Chamber of Commerce and Industry of NCT Delhi v LT. Governor of Delhi, a bench comprising of the Chief Justice of the High Court of Delhi and Justice Sangita Dhingra Sehgal has passed an interim order stating that no coercive action shall be taken against the petitioner therein, pursuant to the Notification dated 3.03.2017 by the Delhi Government until further orders.

The bench is yet to decide the matter filed by the Apex Chamber of Commerce and Industry and the matter is listed before the Delhi High Court for 11th September, 2017. In the interim period, no coercive steps shall be taken as per the Court order dated 7th March, 2017.

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New MRP Rules under GST notified by Central Government

Maximum Retail Price (“MRP”) is the highest price that can be charged to a consumer by the last point in the supply chain which is inclusive of all taxes. But, post Goods and Services (“GST”) Tax introduced in the country on 1 July 2017, the rate of tax has changed in some commodities, thus, affecting the MRP in some cases. This has created a crisis like situation for several businesses which are left with huge volumes of unsold pre-packed items with the previous MRP before the GST came into force.

By way of respite, the Government has issued a notification on 4 July 2017, allowing companies to print, stamp, or use stickers to show the revised MRP on a product package. The old MRP will have to be clearly visible along with the revised MRP sticker. Also, it has been further directed that companies should advertise the change in prices of their products, in at least two newspapers, if they are raising the price of any product featuring both the new (post-GST) and old (pre-GST) MRPs on the packaging. However, no advertisement is required in case of lowering of price. This step is aimed to ensure that the companies and retailers have a way of dealing with the older (pre-GST) stock and preventing profiteering.

This transitional measure can be availed till 30 September 2017, after which all pre-packed goods will have to have just one MRP including the GST.

That said, this notification has come out as a ‘sticker shock’ to the companies who point out that the step is horrendously complicated, time-consuming and tedious as it would be a formidable task for the manufacturers to use stickers that reflect the new MRP as millions of packages are already in stock with distributors and retailers countrywide. Not only would this be virtually impossible but also, it would impose a crushing financial burden on the sellers.

Also, a downside of the step is that the notification issued would result in non-compliance of the provisions under the Legal Metrology Act, 2009, which prohibits manufacturers from changing MRP tags once goods are out of the factory.

The Food and Consumer Affairs Minister, has taken to social media to inform that if the provisions regarding revised MRP, as stated in the rules, are not properly followed, then legal action will be taken against such shopkeeper.

In conclusion, it would be best to state that though the Government may be well intentioned, the steps being taken are harm handed, and punitive and impractical.

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Abolition of Foreign Investment Promotion Board

The entry of Foreign Direct Investment (FDI) into the country has hitherto been  regulated by two routes, one by an automatic route and the other, by an approval route which involves an approval by an inter-ministerial body, named as Foreign Investment Promotion Board (FIPB), housed in the Department of Economic Affairs under the Ministry of Finance. The Finance Minister would approve proposals with total foreign equity inflow below 3000 crore rupees, after consideration of recommendations from FIPB. However, the proposals involving total foreign equity inflow above 3000 crore rupees were approved by the Cabinet Committee on Economic Affairs after consideration of recommendations from FIPB.

The Union Government has made certain policy changes by way of economic reforms to make India a more attractive destination for foreign investment and to upscale the ‘ease of doing business in India’, and thus the Government has phased-out FIPB to facilitate foreign investment in the country. According to the World Bank’s Ease of Doing Business Index, India ranks 130 amongst 189 other countries which is a rather undesirable ranking to have.

FIPB was first constituted in the early 1990s, chaired by the Economic Affairs Secretary with other permanent members. Now, the Board would be replaced by the administrative departments under the concerned ministries who would deal with the approval to the FDI proposals in consultation with Department of Industrial Policy and Promotion (DIPP). The DIPP would also formulate a detailed Standard Operating Procedure (SOP) so as to guide the ministries in the process of approving the applications to ensure consistency of treatment with the applications and uniformity of approach across the sectors. Also, to make them more accountable, strict time-lines would be fixed under the SOP and the concurrence of DIPP is mandated for rejection of proposals. Additionally, the administrative department of the ministries will be responsible for monitoring the compliances imposed under the FDI approval mechanism.

This step hopes to effectively eliminate the bureaucratic hurdles that investors face before investing in the country and since DIPP and FIPB were two separate entities, the proposals occasionally did get held up because of differences in opinion or perception between different ministries engendering unnecessary delays in getting the proposals approved. An investor at times got squashed between DIPP, FIPB and RBI for any FDI-related issue. Further, the fact that the FIPB was constituted with officials from various ministries and regulators, there was a perceived lack of  transparency in the decision-making process.

That being said, it appears that the Government’s decision may turn out to be  little more than a symbolic gesture. While granting the fact that the FIPB may have delayed clearances at times, the efficacy of this move will be determined by the capability of individual ministries to take decisions efficiently and expeditiously, qualities that continue to evade much of our bureaucracy.. This step means that individual ministries (that often function as political and/or bureaucratic fiefdoms) could also exercise their ‘discretionary’ powers without the alleged fear, favour or the cover provided by a collective decision-making body. It will be interesting to see how well these ministries fall in line  with the nuances of the FDI policy and maintain consistency/transparency and continuity in the process, which is of paramount importance for attracting foreign investors.

This move by the Central government is hopefully a step towards liberalization of FDI in India albeit its success would depend largely on the structure of comprehensive guidelines issued by the DIPP in consultation with the ministries.

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ICDS draft for Real Estate Transactions

The Central Government had notified Income Computation and Disclosure Standards (ICDS) vide notification dated 29th September, 2016 by way of powers conferred under Section 145 (2) of Income Tax Act, 1962. The notified standards have mentioned identification of revenue from construction contracts, sale of goods and providing of services. However there was no standard for recognition of revenue from real-estate transactions.
Thereafter, the CBDT placed the ICDS drafts for recognition of income from such transactions on 11th May, 2017. This Income Computation and Disclosure Standard shall be applicable for determination of income from all forms of transactions in real estate, which refers to land as well as buildings and rights in relation thereto. The draft provides that where the economic substance is similar to a construction project, project revenue and cost shall be recognized by referring to the stage of completion of the project on the last date of financial year. Further, it is stated that where the substance of the project is not similar to that of a construction project, the income will be recognized in accordance with income from sale of goods as prescribed in ICDS IV.
Indicators that economic substance of a project is similar to a construction contract are: (a) The duration of such projects is beyond 12 months and the project commencement date and project completion date fall into different previous years, (b) Project involves activities similar to construction contracts such as land development, structural engineering, architectural design, construction or activities of similar nature, (c) While individual units of the project are contracted to be delivered to different buyers these are interdependent upon or interrelated to completion of a number of common activities with or without provision of common facilities and (d) The construction or development activities form a significant proportion of the project activity.
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Embassies to inform Foreign Nationals to be aware of Indian Laws: Delhi High Court

The High Court of Delhi has asked the Ministry of External Affairs to inform the Embassies and High Commissions in Delhi that their citizens should be well aware of the local laws in order to avoid inadvertent violations.
The Delhi High Court has directed the Ministry of External Affairs to send a communication to all Embassies, Consulates or High Commissions in India advising foreign nationals travelling to this country as to the desirability to bear in mind the local laws, particularly laws such as the Arms Act.
The Court heard two Petitions filed for quashing of FIRs lodged under the Arms Act against two foreigners, one from the UK and another from Kenya. Both citizens had travelled to India on a valid visa, and were found to be carrying bullets at the time of leaving the country. The two have now filed a quashing petition stating that the FIRs against them be quashed as the cartridges were not in their conscious possession and, therefore, they did not commit any intentional acts of commission or omission to constitute offence under Section 25 of the Act.
The Court noted that the FIRs as well as investigation in both cases did not indicate anything suggesting conscious possession. The court therefore quashed the FIRs against the two citizens.
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Competition Commission of India on Predatory Pricing and Privacy Policy of WhatsApp Inc.

In a recent judgment by the Competition Commission of India [CCI], by the bench headed by Mr. Devender Kumar Sikri Chairperson in the case of Vinod Kumar Gupta vs. Whatsapp Inc. [decided on June 1, 2017 ], it has been held that even though ‘WhatsApp’ appeared to be dominant in the relevant market, the allegations of predatory pricing had no substance and the WhatsApp had not contravened any of the provisions of Section 4 of the Competition Act.

Vinod Kumar Gupta, the Informant had filed Information under Section 19(1)(a) of the Competition Act, 2002 (the ‘Act’) against WhatsApp Inc., alleging contravention of the provisions of Section 4 of the Act.

It was stated that the WhatsApp was acquired by Facebook Inc. (‘Facebook’), the largest social networking site, on 19th February, 2014 for approximately US$19.3 billion.

As per the Informant, WhatsApp had introduced many changes to its privacy policy on 25th August, 2016 whereby the users of ‘WhatsApp’ were forced to share their account details and other information with ‘Facebook’ in order to continue availing the services of ‘WhatsApp’.

The Informant had made the submission that the “relevant product market” in this scenario would be ‘free messaging App available to smartphones’ and the relevant geographical market was ‘Global’.
As per the Informant, by removing subscription fees, WhatsApp has enlarged its consumer base substantially from 450 million to over 1 billion and it is providing the services by sourcing funds from its parent company i.e. ‘Facebook’.

The Commission also observed the submission of WhatsApp regarding its users safeguards that all types of ‘WhatsApp’ messages (including chats, group chats, images, videos, voice messages and files) and ‘WhatsApp’ calls are protected by end-to-end encryption so that third parties and ‘WhatsApp’ cannot read them and also the message can only be decrypted by the recipient.

Further, as stated by WhatsApp, nothing a user shares on ‘WhatsApp’, including his/ her messages, photos, and account information, is be shared onto ‘Facebook’ or any other apps of ‘Facebook family of companies’ for any third party to see, and nothing a user posts on those apps will be shared by ‘WhatsApp’ for any third party to see.

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GOVERNMENT MAKES RULES TO PREVENT PUBLIC SLAUGHTER OF ANIMALS

 

The Environment and Forests Ministry has notified rules under the Prevention of Cruelty to Animals Act, banning the sale of buffaloes and cows for slaughtering in the animal markets.

The Prevention of Cruelty to Animals (Regulation of Livestock Markets) Rules, 2017 permits animal trade only between farmland owners. Prevention of Cruelty to Animals (Regulation of Livestock Markets) Rules, 2017 have also been notified by the Central government. This notification covers steers, buffaloes, heifers, buffaloes, cows, bulls and calves, and also on trade of camel.  These rules also mandate an undertaking stating that the animals bought under the transaction are bought for trade purposes only and not for slaughter.

Rules also provide for constituting District Animal Market Monitoring Committee, which shall regulate the animal market in the district. These rules further prohibit many prohibit many practices as “cruel and harmful”. These include the methods for animal identification, painting and shearing of horns, ear cutting of buffaloes, using any harmful chemical on the body parts of the animals. The person incharge of animal shall also ensure that no injury, pain or suffering has been inflicted upon the animal.

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WannaCry: India more prone to Risks

WannaCry, also known as WannaCrypt has infected around 45,000 computers across 74 countries. WannaCry is a kind of ransomware which encrypts the computers data in seconds and displays a message on the screen asking the user to pay amount of $ 300 in Bitcoins to decrypt the data and restore user’s access. This ransomware has targeted Microsoft Windows devices specifically. According to Microsoft it had released the security update addressing the vulnerability posed by such attacks.

In India, most official computers use windows, there is no surety of regular updates, thus the risk of Indian computers being attacked by this worm is very high. Personal data of billions of Indians is now connected to the Aadhar database. Even the user’s bank account is now linked to the Aadhar number; this ransomware can encrypt the entire database and make it inaccessible until the ransom is paid. A greater chunk of individuals and companies are using the pirated versions of the Windows operating system and other miscellaneous softwares which makes India an easy target. In India this ransomware has already infected the Andhra Pradesh police system, manufacturing companies, retailers, banks and a Chennai based automaker facility.

A distinctive feature of this ransomware is that it also works as a worm. It spreads across like a contagious disease, from one system to another. Indian computers are most vulnerable to attacks owing to lack of antispyware or malware software installed in their systems. WannaCry is a mutating ransomware; it changes with time and spreads in the network.

Indian Computer Emergency Response Team says, “The ransomware called WannaCrypt or WannaCry encrypts the computer’s hard disk drive and then spreads laterally between computers on the same LAN. The ransomware also spreads through malicious attachments to emails.” Microsoft too has grieved over the matter.

Even if the virus is on spread, the ransomware baiters would be receiving money and might come up with irrepressible worms against which the best of security patches will prove ineffective.

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PCB v BCCI: This is no friendly match!

 

The Pakistan Cricket Board has forwarded a legal notice to the Board of Control for Cricket in India for dishonouring the Memorandum of Understanding between the two. The MoU signed between PCB and BCCI was on the terms that they agreed to play six bilateral series from 2015 to 2023. The MoU has not received clearance on the schedule of series due to strained diplomatic relations between India and Pakistan.

Under the said agreement, India and Pakistan were scheduled to play in the month of November – December 2015, but India refused to play on neutral grounds like Saudi Arabia or Sri Lanka

The PCB while taking advice from an English Law Firm claims that due to the refusal of India to play the series which was supposed to be hosted by Pakistan, they have lost about $200-300 million. The PCB notice claims that due to India’s repeated refusal, three series have not been played since 2015, two of them which Pakistan was supposed to host.

The PCB has initiated the legal process through a Notice of Dispute under the Dispute Resolution Committee Terms of reference of the International Cricket Council.

 

 

 

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Roche in Problème juridique

The Competition Commission of India has initiated an inquiry regarding unfair trade practices by F. Hoffmann-La Roche.  In the month of July last year Mylan Pharmaceuticals and Biocon Limited had approached the CCI, alleging that Roche was involved in anti-competitive practices with regards to their breast cancer medicine: Trastuzumab.

The CCI, prima facie has found some substance in the allegation of misuse of dominant status by F. Hoffmann-La Roche. An inquiry has been ordered by the CCI the report of which is too be submitted within 60 days.

La Roche has been accused of influencing regulatory authorities, raising unwarranted concerns regarding the efficacy of biosimilars. The Pharma giant is also accused of stalling the approvals and marketing of biosimilars.

Trastuzumab is a biological drug for the treatment of Breast Cancer. Biocon manufactures a biosimilar to this drug. La Roche has apparently approached a few hospitals and raise unwarranted claims and questions about the efficacy of such biosimilars. It is also alleged that women are practically forced by hospitals into using La Roche’s Trastuzumab for their treatment. If they refuse of intend to use a cheaper alternative, they are either refused treatment, or cautioned that the hospital shall bear no responsibility for adverse consequences.

The CCI in its 36 page order referred to an ongoing Delhi High Litigation between La Roche and Biocon, where Roch has questioned the approval of Biocon’s products, has observed that there are questionable practices adopted by Roche to create a negative image about biosimilars. The CCI’s order also mentions that Roche has adopted legal methods to delay the launch of biosimilars, like the launch of TrastuRel , the biosimilar version by Reliance Life Science’s was delayed by almost a year because of the law suit instituted by Roche against them in the Delhi High Court.

 

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Mushroom Growth of Cyber Crimes and its Control

According to recent Home Ministry data, 39 government websites were hacked in the month of January and February, 2017 alone. According to Ministry of Information and Technology, the number of government websites hacked has been on a steady rise from 155(in 2014) to 199(last year). The National Crime Records Bureau’s (NCRB) report for 2015 which was submitted in 2016, says that 11,592 cases of cyber crime were registered in India, out of which Uttar Pradesh leads in the highest number of recorded cyber crimes. The majority of the cases so registered were mainly related to financial gains.
It has also been noticed that demonetisation had spiked the number of cyber crimes as well as that the period post demonetisations has reflected , how ineffective India’s Cyber defence indeed is, as mobile and electronic wallets are extremely vulnerable to hacking.
The opinions of Legal experts are that essentially the Information Technology Act is lacks the element of legal deterrence with regards to these cyber crimes which are on the rise. With an exception of Cyber Terrorism and Child Pornography, none of the other cyber crimes are Non Bailable.
The Home Ministry has proposed to institute the Indian Cyber Crimes Coordination Centre ( I4C). The Government intends to initiate an online platform to report such cyber crimes and cyber crime forensic laboratories and training sites so as to strengthen the enforcement of such cyber laws .The Home Ministry in an attempt to address the rise in cyber crimes with regards to online debit/credit cards in the state of Karnataka has authorised the institution of 41 new police Stations and 6 additional police stations at each of the commissionerates to specifically deal with cyber crimes.
To control this mushroom growth of cyber crimes, it is extremely essential to strengthen the legal framework and effectuate such policies as according to the nation’s requirements.
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SC: Anti Torture Legislation is the Need of the Hour

According to a latest PIL filed by the former Law Minister, Ashwani Kumar, the petitioner wants the government to be directed to draft a framework on the lines of the International Convention against Torture. The International Convention on Torture, of which India is a signatory since 1997, hasn’t been ratified in India.
The petitioner in his PIL has also demanded proper guidelines to prohibit torture, cruelty, inhuman or degrading treatment of jail inmates. Citing the fact that India is one of the nine countries who hasn’t ratified the said convention out of the 161 signatories, Mr. Kumar has expressed the need on a rehabilitation scheme, relief and compensation scheme for victims of custodial torture and violence. The Supreme Court in September, 2016 has issued a notice to the centre with regards to the same PIL.
According to a data published by the Home Ministry in 2015 the number of unnatural prisoner deaths have increased from 126 (2012) to 195(2014). Similarly, a data was also presented on the increase in proportion of percentage of death of children in police custody to total number of deaths in police custody.
Stating that the Law Commission must take up this matter with extreme urgency, a bench of Chief Justice of India JS Khehar and Justice DY Chandrachud has given a period of 10 day to the government to prepare its response. The Supreme Court bench has stated that the existence of such standalone law is in the national interest, as India faces roadblocks in extradition of criminals from foreign nations.

WhatApp in a Soup of its own Data

The Supreme Court rejected  the government’s contention to hold back the hearing of  the Privacy issue regarding WhatsApp till Diwali , as that is when the new regulations from the Telecom Regulatory Authority of India (TRAI) .

A five judge bench of the Supreme Court of India led by Justice Dipak Misra is entrusted to examine if the Facebook has violated the privacy rights of almost 160 million users of WhatsApp  who have an access to all the messages and contents shared via the platform.

The Constitutional bench has asked Facebook, WhatApp, the Centre and the Telecomm Regulatory Authority of India to respond to the petition by two young Indian students.  Harish Salve arguing for the petitioners has invoked the citizen’s fundamental right to speech and expression and right to privacy under Article 19 and 21 respectively. He contended that WhatsApp has become a  Public Utility Service, by providing free messaging, call and video call services.

The of Chief Justice J S Khehar and Justice D Y Chandrachud bench had difficulties initially to entertain petition stating that could a free service provider be required to be liable for privacy rights being violated.

Since its inception in India in 2010, WhatsApp’s privacy policy promises to protect the data and content , which has continued even after being acquired by Facebook in 2014.

The government represented by attorney general Mukul Rohatgi while contending to hold back the hearing said that TRAI is attempting to make such guidelines so as to ensure security and confidentiality to such data which are retained by the servers.

The Bench is to hear preliminary written submissions from all the parties by 24th April and the next date of hearing has been set for the 27th April, 2017.

Pro Bono work may earn extra brownie points for Judicial Aspirants.

The Union Law Minister, Ravi Shankar Prasad indicated that Pro Bono legal service may be a part of the Memorandum of Procedure, which are guidelines for High Court Judge selection Procedure, which is presently being revised by the centre.

On the 20th of April, Mr. Prasad, initiated a few measures, which includes Pro bono legal Services, Tele Law service and Nyay Mitra (Justice Facilitator). These measures aim at  “ digitally ” including the  underprivileged in the justice delivery system.

The Department of Justice has launched an online portal on its website doj.gov.in .The lawyers may register themselves to volunteer services for this mainstream legal aid program. The ‘Tele Law’ program aims to include the expert panel of Lawyers at the State Legal Service Authority (SLSA) and the marginalized communities through the Common Service Centre (CSCs).

‘Nyay Mitra’ strives to solve the issue of pending cases by designating a retired judicial officer/executive as a justice facilitator. The justice facilitator among other assistance is to recognize such delayed cases through the National Judicial Data Grid, he is also to refer such cases to the Lok Adalats for dispute resolutions.

Sp Bala Subrahmanyam and IIayaraja | Bonum lex

Copyright Feud between SP Balasubrahmanyam and Ilayaraja

In recent news SP Balasubrahmanyam, famous playback singer and vocal artist received a legal notice from Ilayaraja, a  composer who has almost composed for over 6000 films, most of them sung by SP Balasubrahmanyam, prohibiting him from performing any song composed by him without prior permission.

S.P.B, as lovingly called by his fan, through a Facebook post, expressed this news to his fans along with his opinion on it. S. P. B who is presently on an International Tour since August visiting  Toronto, Russia, Sri Lanka, Malaysia, Singapore and Dubai, said that Shri. Ilayaraja had never expressed any such ideas during the previous shows, and that he was ignorant of the Law. He has affirmed that his troupe shall not be performing any such songs while on the International Tour.

According to the Indian Copyright Laws, SP Balasubrahmanyam has equal performer’s rights on each of such songs performed by the duo. Balasubrahmanyam as the singer of all these songs has the performer’s rights to perform them. However, Ilayaraja here is entitled to the royalty for performing the song from the venue owner. In the present scenario the venue owner is performing such copyrighted song for commercial purposes; Ilayaraja has a share in this royalty.

The fans of both these musical geniuses might have to wait till this feud is over to enjoy some of their best works in concert performances.