3ND INTRA-MOOT COURT COMPETITION

2022

S UPREME C OURT OF B HARAT AT I NDRAPRASTH

C IVIL O RIGINAL J URISDICTION

S PECIAL L EAVE P ETITION N O . _____ O F 2014

(U NDER A RTICLE 136 OF T HE C ONSTITUTION OF BHARAT)

IN THE M ATTER OF :

J ORDAN J AKHAR (JJ) ……………………………………PETITIONER

V.

P LATINUM G ROUP ………….…………………………..... R ESPONDENT

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J ORDAN J AKHAR (JJ)

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Table of Content
INDEX OF AUTHORITIES.........................................................................................................IV

LIST OF ABBREVIATIONS......................................................................................................VII

STATEMENT OF JURISDICTION...............................................................................................IX

STATEMENT OF FACTS.............................................................................................................X

I. THE PARTIES IN CONCERN –.........................................................................................X

II. LIFE-SAVING CANCER MEDICATION............................................................................X

III. LEASING OUT THE ‘RIGHTS TO MINE’ OF UNOBTANIUM............................................X

IV. ALLEGATIONS AGAINST THE GOVERNMENT...............................................................X

V. FOREIGN INVESTMENTS FOR EXTRACTING, PROCESSING, AND MANUFACTURING OF

THE DRUG................................................................................................................................XI

VI. FILING OF PIL BY THE PUBLIC RIGHTS ASSOCIATION.............................................XI

ISSUES RAISED.......................................................................................................................XII

SUMMARY OF ARGUMENTS.................................................................................................XIII

ARGUMENTS ADVANCED.......................................................................................................XV

1. WHETHER OR NOT, THE HIGH COURT SHOULD HAVE PROCEEDED ON THE

BASIS THAT IN MATTERS OF ALLOCATION OF NATURAL RESOURCES, REVENUE

MAXIMIZATION WAS THE PRIMARY OBJECTIVE OF THE GOVERNMENT TO BE CARRIED

OUT THROUGH AN AUCTION PROCESS?................................................................................XV

WHETHER IT IS PERMISSIBLE FOR THE COURT TO INTERFERE IN MATTERS OF POLICY?....XV

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PRIMARY OBJECTIVE OF THE GOVERNMENT IS NOT IN VIOLATION OF ARTICLE 14 OF THE

CONSTITUTION OF ENDOR....................................................................................................XVI

2. WHETHER OR NOT, THE FIRST COME FIRST SERVE MODEL SHOULD BE

CONSIDERED IN CONSIDERATION OF PUBLIC BENEFIT BY THE GOVERNMENT AT 1998

LEVEL ITSELF?....................................................................................................................XVII

3. WHETHER OR NOT THE ORDER OF HON’BLE HIGH COURT TO QUASH THE

LEASES WAS JUST AND AGAINST THE INTERESTS OF FOREIGN SHARE-HOLDERS?..........XIX

RIGHTS OF FOREIGN INVESTORS:........................................................................................XIX

LIFTING UP OF CORPORATE VEIL........................................................................................XXI

PRAYER FOR RELIEF.........................................................................................................XXII

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I NDEX OF A UTHORITIES

Cases

Namit Sharma v. Union of India, (2013) 1 SCC 745.....................................................viii, xvii

Adkins v. Children’s Hospital, U.S 525 (1923)......................................................................xvi

Balco Employees’ Union v. Union of India, (2002) 2 SCC 333.....................................viii, xvi

Chairman and Managing Director, United Commerical Bank v. P.C Kakkar, (2003) 4 SCC

364..............................................................................................................................viii, xvii

Council of Civil Service Unions v. Minister for the Civil Service 1985 AC 374...........viii, xvi

Devender Pal Singh v. State (NCT of Delhi) AIR 2002 SC 1661..........................................xxi

Fertilizer Corpn Kamgar Union v. Union of India, (1981) 1 SCC 568..........................viii, xvii

G.B. Mahajan and Others v. Jalgaon Municipal Council and Ors, AIR 1191 SC 1153.......xviii

Gallaghar v. Germania Brewing Company [1893] 53 MINN 214........................................xxii

Indian Airliness officer’s Assn. v. Indian Airliness Ltd., 2007 (10) SCC 684,....................xvii

Kamgar Union v. Union of India, (1981) 1 SCC 568.............................................viii, xvi, xvii

Kehar Singh v. State (Delhi Administration) AIR 1988 SC 1883..........................................xxi

Lal Singh v. State of Gujarat (2001) CrLJ 978 (SC).............................................................xxi

Lochner v. New York, U.S 45 (1905) ....................................................................................xvi

M.P Oil Extaction v. Union of M.P (1997) 7 SCC 592...................................................viii, xvi

Maneka Gandhi v. Union of India, (1978) 1 SCC 248...................................................viii, xvii

Mohd Khalid v. State of West Bengal (2002) 7 SCC 334......................................................xxi

Mohd Usman Mohd Hussain Maniyar v. State of Maharashtra AIR 1981 SC 1062..............xxi

Mount Carmel School Society v. DDA 2008 (2) SCC 141....................................................xvi

Rameshwar Prasad v. M.D, (1999) 8 SCC 381......................................................................xvi

Sachidanand Pandey v. State of West Bengal (1987) 2 SCC 295..........................................xix

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Santanu Ray v Union of India 1988 (18) ECC 51................................................................xxii

Sattan alias Satyendra & Ors v. State (2001) CRLJ 676 (All)................................................xxi

Shivanarayan Laxminarayan Joshi v. State of Maharashtra AIR 1980 SC 439.....................xxi

Smt. Indira Nehru Gandhi v Shri Raj Narain and Anr. AIR 1975 SC 2299.........................xviii

State (NCT of Delhi) v. Jaspal Singh (2003) 10 SCC 586.....................................................xxi

State of Kerala v. P Sugathan (2000) Cr L J 5484 (SC).........................................................xxi

State of Madras v. V.G Row, AIR 1952 SC 196.............................................................viii, xvi

State of Punjab v. Ram Lubhaya Bagga 1998 (4) SCC 495 para,35to 38............................xviii

State v. Sevanivatra Karmachari, (1995) 2 SCC 117......................................................viii, xvi

Tata Cellular v. Union of India, (1994) 6 SCC 651.......................................................viii, xvii

U.P. Kattha Factories Association v. State of U.P , 1996 (2) SCC 97.................................xviii

Ugar Sugar Works Ltd v. Delhi Admin (2001) 3 SCC 635.............................................viii, xvi

Vacher & Sons Ltd v. London Society of Compositors 1913 AC 107............................ix, xviii

West Coast Hotel Co. Parrish, v. U.S 379 (1937) ..................................................................xvi

Yogesh v. State of Maharashtra (2008) 10 SCC 394..............................................................xxi

Statutes

FEMA, 1999...........................................................................................................................XX

Indian Penal Code, 1860........................................................................................................XX

Mines and Minerals (Development and Regulation) Act 1957............................................XVI

Prevention of Corruption Act, 1988......................................................................................XXI

Primary Authorities

D.D Basu, Administrative Law, Kamal Law House...............................................................xvi

D.D Basu, Administrative Law, Kamal Law House...............................................................xvi

Taxmann’s Company Law and Practice, A K Majumdar, Dr. G K Kapoor, 16th edn,..........xxii

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Freeman, M.D.A, “Lloyd’s Introduction to jurisprudence”, Sweet & Maxwell, at pg., 719. xvi

Loewenstine, Karl, “Political Power and the Governmental Process” ,The University of

Chicago Press, Chicago & Landon, at pg., 44..................................................................xvi

Nordhaus Samuelson, Economics, Tata McGraw-Hill Edition, 18th Ed. xviii

Secondary Authority

Black’s law dictionary, 9th edition...........................................................................................xvi

Order No-I&M25(3)/2005, dated 14 September 2005.............................................................xx

Constitutional Provisions

Article 14...............................................................................................................................XVI

Article 31C............................................................................................................................XVI

Article 47...............................................................................................................................XIX

Websites

DIPP, GOI data till 2010. Available at

http://www.investindia.gov.in/InvestIndia_Brochure_web.pdf...........................................xx

Health Situation in the South-East Asia Region 2001-2007, WHO Regional Office for South-

East Asia, p. 126, available at http://apps.searo.who.int/PDS_DOCS/B3226.pdf.......xix, xx

http://finmin.nic.in/bipa/bipa_index.asp.................................................................................xxi

https://www.imf.org/external/pubs/ft/weo/2007/01/data/weorept.aspx?

sy=1998&ey=2005&scsm=1&ssd=1&sort=country&ds=.&br=1&pr1.x=29&pr1.y=5&c=5

10&s=NGDP_RPCH%2CPCPIPCH&grp=1&a=1...........................................................xxii

Investment Treaies as Corporate Law : Shareholder Claims and issues of Consistence, David

Gaukrodger, p. 13. Available at http://www.oecd.org/corporate/WP-2013_3.pdf.......xx, xxi

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L IST OF A BBREVIATIONS

ABBREVIATION TERM

& "and"

AIR All India Reporter

All ER All England Reporter

Art. Article

DB Division Bench

Del Delhi High Court

e.g. Example Gradient

etc. "et cetera"

Govt. Government

GOI Government of India

H.P. Himachal Pradesh

i.e. "that is"

J&K Jammu and Kashmir

K.B. Kings Bench

No. Number

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PC Privy Counsel

para / ¶ Paragraph

Page/pg. Page Number

Raj Rajasthan

Retd. Retreated

SC Supreme Court

SCC Supreme Court Cases

SCR Supreme Court Reports

SEBI Securities Exchange Board of India

Supp. / Supl. Supplementary

WP Writ Petition

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S TATEMENT OF J URISDICTION

The petitioner herein humbly submits that as the law of Bharat is in pari materia to the laws

of Republic of India thus prefers to invoke special leave petition of this Honourable Court

under Article 133 of the Constitution of India 1949 read as-

133. Appellate jurisdiction of Supreme Court in appeals from High Courts in regard to
civil matters
(1) An appeal shall lie to the Supreme Court from any judgment, decree or final order in a

civil proceeding of a High Court in the territory of India if the High Court certifies under

Article 134A

(a) that the case involves a substantial question of law of general importance; and

(b) that in the opinion of the High Court the said question needs to be decided by the

Supreme Court

(2) Notwithstanding anything in Article 132, any party appealing to the Supreme Court

under clause ( 1 ) may urge as one of the grounds in such appeal that a substantial

question of law as to the interpretation of this Constitution has been wrongly decided

(3) Notwithstanding anything in this article, no appeal shall, unless Parliament by law

otherwise provides, lie to the Supreme Court from the judgment, decree or final order of

one Judge of a High Court

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I SSUES R AISED

I. WHETHER OR NOT Platinum group has committed wilful and medical

negligence?

II. WHETHER OR NOT, there was a breach of Contract by either of the parties?

III. WHETHER OR NOT, r JJ is liable for civil defamation against Platinum Group?

IV. WHETHER OR NOT, either of the parties shall be compensated for the loss/harm
incurred?

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 S UMMARY OF A RGUMENTS

I. WHETHER OR NOT Platinum group has committed wilful and medical

negligence?

Framing of the policies by the Court offends the democratic ideals that the elected
representative should govern the community, and the representatives are answerable to the
people. Judicial review as one of the basic feature of the written Constitution enables the
Court to interfere into the Government decisions but it has to be proved ex-facie that there is
grave violation of fundamental rights. Thereby, the Hon’ble Courts should not interfere in
relation to the policy decisions unless and until violation of Fundamental Right/s has been
proved.

1. WHETHER OR NOT, THE GOVERNMENT AT 1998 LEVEL ITSELF

SHOULD CONSIDER THE ‘FIRST COME FIRST SERVE’ MODEL IN
CONSIDERATION OF PUBLIC BENEFIT?

The Government follows the policy of ‘Trial and Error’ to check which policy is beneficial
and would serve the interest of the State and its Citizens. Policymaking is entirely the domain
of the Parliament and Executives. In this case, the Govt. had adopted various policies during
16 years in order to enlarge the scope of accessibility of mass myriad to the reduce the price
of the cancer drug in the market which eventually helped in increasing the supply of the drug
in the market at a reasonable price. As Public benefit with economic growth is the paramount
importance for a developing nation, the Policy decision of the Govt. should not be
questioned.

2. WHETHER OR NOT, THE ORDER OF HON’BLE HIGH COURT TO

QUASH THE LEASES WAS JUST OR AGAINST THE INTERESTS OF
FOREIGN SHAREHOLDERS?
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The illegal acts and omissions perpetrated by the company’s minority stakeholders,
promoters and the government official amounts to criminal conspiracy, and such
misappropriation of funds amounts to an economic offence disturbing the economic
equilibrium of Endor. Further, as all the BITs of India contain a clause making it the
responsibility of the host state to protect the interest of investors and several ICJ decisions
recognizing the same, the foreign investors have a right to be protected. In the light of above
facts, the corporate veil must be lifted, in order to punish the actual perpetrators for the illegal
act, and not the bona fide foreign investors.

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A RGUMENTS A DVANCED

1. WHETHER OR NOT, the High Court should have proceeded on the basis that in
matters of allocation of natural resources, revenue maximization was the primary
objective of the Government to be carried out through an auction process?

Whether it is permissible for the Court to interfere in matters of policy?

The word policy means the general principle by which government is guided in its
management of public affairs1. Its formalization and legalization are incumbent on the
legitimate power holders, i.e., the government and the parliament 2. The ministers of the
crown represent the people and are best judge for the policy consideration 3. Ascribing
‘Judges’ as ‘deputy legislators’ Dworkin4 pointed out, firstly, it offends the democratic ideal
that a community should be governed by elected officials answerable to the electorate 5, and
secondly, “if a judge makes new law and applies it retroactively” to the litigation he is
deciding, “the losing party will be punished, not because he has violated some duty he had,
but rather a new duty created after the event”. The American Supreme Court judgments 678,
considering the historical perspectives and the development of American Constitutional law,
concluded, erstwhile, that the court has regretted on the mistakes it committed by substituting
the view of the Parliament by its own political agenda. The court in West Coast Hotel v.
Parish9 made it clear that it is the parliament and not the court which is the best judge of the
right of the people. The court cannot substitute the intent of the parliament by its political
view. The Hon’ble Supreme Court of India in catena of cases observed that restrictions
imposed by the government must not be held unreasonable merely because it seems
unreasonable to the court, the court must accept legislative judgment 10 until there is a direct
and inevitable violation of fundamental right11. In the case of Mount Carmel School Society
v. DDA12 court held that the government policy is not subject to judicial review unless it is
1
Black’s law dictionary, 9th edition.
2
Loewenstine, Karl, “Political Power and the Governmental Process” ,The University of Chicago Press,
Chicago & Landon, at pg., 44.
3
Rameshwar Prasad v. M.D, (1999) 8 SCC 381; State v. Sevanivatra Karmachari, (1995) 2 SCC 117; D.D
Basu, Administrative Law, Kamal Law House, Pg. 459.
4
Freeman, M.D.A, “Lloyd’s Introduction to jurisprudence”, Sweet & Maxwell, at pg., 719.
5
“The Judge, not being elected, must not substitute his own will as against the legislature.”
6
West Coast Hotel Co. Parrish, v. U.S 379 (1937) .
7
Adkins v. Children’s Hospital, U.S 525 (1923) .
8
Lochner v. New York, U.S 45 (1905) .
9
West Coast Hotel Co. Parrish 300 U.S. 379 (1937) .
10
State of Madras v. V.G Row, AIR 1952 SC 196, 200; Balco Employees’ Union v. Union of India, (2002) 2
SCC 333, at pag. 355-359; Kamgar Union v. Union of India, (1981) 1 SCC 568, 584.
11
M.P Oil Extaction v. Union of M.P (1997) 7 SCC 592; Ugar Sugar Works Ltd v. Delhi Admin (2001) 3 SCC
635; Council of Civil Service Unions v. Minister for the Civil Service 1985 AC 374, 414.
12
Mount Carmel School Society v. DDA 2008 (2) SCC 141

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demonstrably arbitrary, capricious irrational, discriminatory or violation of constitutional or
statutory provision or unless the policy can be faulted on the grounds of malafide,
unreasonableness, arbitrariness or unfair; or unless and until violation of mandatory provision
is found or it is held that a decision is taken for an unauthorized or illegal purpose13.
Thus humbly submitted that even if this court is of the opinion to exercise its jurisdiction
irrespective of policy consideration, but it must deny such exercise on the ground that there is
no direct and inevitable effect on the fundamental rights14.

Primary Objective of the Government is not in violation of Article 14 of the Constitution of

Endor

For the duration of long 16 years the primary objective of the government was not revenue
maximization, but concerns about public health and welfare in respect that the Cancer
Medication so that it could be made available to the public at large. Improvement of public
health is the constitutional obligation imposed on the State under Article 47 and through its
25th Amendment Article 31C was introduced which protects the laws made giving effect to
certain directive principles. Section 13(1) and (2) (a) (e) Mines and Minerals (Development
and Regulation) Act 1957, empowers Government of Endor to grant lease and change its
policy concerning mining lease. Furthermore, it is submitted that Article 14 as including the
principles of reasonableness only requires the government to act on reasonable grounds. The
grounds can be checked on the basis of legality and not on merits, but which should be
checked only in cases where it, prima facie manifests error on the point of law15. The Indian
Supreme Court on the application of principles of arbitrariness has held that the court while
adjudging administrative actions can only enter into the legality of the case and not on
merits16. The court’s function is to check whether the decision taken is fair and free from the
taint of unreasonableness and has substantially complied with the norm of procedure 17. The
facts of the case show no actions violates any policy made on allocation of natural resources.

13
Indian Airliness officer’s Assn. v. Indian Airliness Ltd., 2007 (10) SCC 684,703, Para,.33.
14
Maneka Gandhi v. Union of India, (1978) 1 SCC 248.
15
Tata Cellular v. Union of India, (1994) 6 SCC 651; Chairman and Managing Director, United Commerical
Bank v. P.C Kakkar, (2003) 4 SCC 364.
16
Maneka Gandhi v. Union of India, (1978) 1 SCC 248.
17
Fertilizer Corpn Kamgar Union v. Union of India, (1981) 1 SCC 568, 584.

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2. WHETHER OR NOT, the first come first serve model should be considered in
consideration of Public benefit by the Government at 1998 level itself?

The Parliament is the Appropriate Body to make the Policy Decision

The government followed the ‘Trial and Error’ method to check as to what policy is best for
the sustaining growth of economy in the country and use the best cost effective improved
methods of management for balancing of costs and control ratio between cost and benefit and
all this can be owed to the expansion of the States presence in the field of Trade and
Commerce18. There is a demarcated jurisdiction within which each of the three organs of the
government is bound to act as per the doctrine of Separation of Powers 19. In present case
Hon’ble High Court moved one step ahead and held that first-come-first-served policy is not
proper policy for the allocation of lease and court stated that auction is the best policy for the
allocation of lease to ‘right to mine’, but court cannot do so because court is not competent
authority to make the policy. In the case of U.P. Kattha Factories Association v. State of
U.P20. Hon’ble Supreme Court declined to interfere in the matter of policy and pronounced
that state is competent authority to make the policy not the court. Court can only check the
validity of policy in accordance with the Constitution. In the case of State of Punjab v. Ram
Lubhaya Bagga21 court said that state is competent authority to change its policy from time
to time under the changing circumstances, which cannot be questioned in the court through
the changed policy deviated from the judicial pronouncement of the Supreme Court. In the
present case something being welfare to the community is for the government to decide and
not the court22.

Public Auction Method in the Year 1998

As the primary objective of the State of Endor was to increase the competition in the market
hence, emphasis was put in law of Demand and Supply. In order to increase the quantity as in
demand in the market and at the price demanded by mass, to accommodate its supply chain
was very important to be arranged for, quantity affects the price of a good. As per the law of
economics23, the increase in supply will directly result in the decrease in the price of the
product24 and would thus serve the purpose of the government as well to bring healthy
competition in the market. Thus the supply and demand will give effect to the equilibrium
price and quantity25. In the instant case, the Government’s decision to lease out the mining
rights of Unobtanium following different policies during 16 years was in order to enlarge the

18
G.B. Mahajan and Others v. Jalgaon Municipal Council and Ors, AIR 1191 SC 1153.
19
Smt. Indira Nehru Gandhi v Shri Raj Narain and Anr. AIR 1975 SC 2299.
20
U.P. Kattha Factories Association v. State of U.P , 1996 (2) SCC 97, para, 4,5.
21
State of Punjab v. Ram Lubhaya Bagga 1998 (4) SCC 495 para,35to 38.
22
Vacher & Sons Ltd v. London Society of Compositors 1913 AC 107, 118.
23
Nordhaus Samuelson, Economics, Tata McGraw-Hill Edition, 18th Ed., p 55.
24
Ibid.
25
Ibid.

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scope of accessibility of mass myriad to the cancer drug in the market. Thus, it helped in
increasing the quantity of the drug in the market resulting in decrease in price. That even after
addressing the paramount immediacy of public health Government considering the trends in
the market economy held that further chances to decrease the prices of such life-saving drugs
existed and as such it came to determine the appropriateness of lease rent and the policy to
hold a public auction as well. The primary obligation of the State is to feel the pulse of the
needs of the citizens and act accordingly. In Sachidanand Pandey v. State of West
Bengal26, the Court referred to propositions: “State-owned or public-owned property is not to
be dealt with at the absolute discretion of the executive. Certain precepts and principles have
to be observed. Public interest is the paramount consideration. One of the methods of
securing the public interest, when it is considered necessary to dispose of a property, is to sell
the property by public auction or by inviting tenders.”
Policy of first come first basis in the Year 2005

According to the survey as reported by WHO27 cancer being one of leading causes of death
worldwide, is a generic term for a group of more than 100 diseases affecting different parts of
the body. The diseases occurs through a pathological breakdown of the processes which
control the proliferation, differentiation and death of cells. With age standardized mortality
rate of 111 per 100000 and a 9% share in total deaths, cancer has become an important public
health priority in the South-East Asian countries 28. It was estimated that in 2000, there were
1.3 million cases and 0.9 million deaths from cancer in the region with cervix uteri, breast,
oral cavity and lung cancer the most common. According to WHO projections, almost half of
the estimated 89 million NCD-related deaths that are likely to occur in the South-East Asia
Region over the next 10 years will be premature 29. If proper public health is not initiated,
disability and premature deaths from cancer and other NCDs will grow by more than 21%
over the next 10 years in the SEA Region. Further, effective cancer control requires a
comprehensive national cancer control programmes along with other policies and framework
resulting in adequate allocation of resources which helps in developing the cancer medication
and distribution of right to exercise such policies and framework through exploiting resources
to others30. Reasonably it is clear that enabling the private entities into the mine and minerals
sector by the Government would provide the private entities to encash the opportunities but
considering the huge amount of investment required for the infrastructure to the extent of
producing the lifesaving drugs would require huge length of the Exchequer of the State and
that would weaken the strength of the Government in complying the mandates of the
constitution in regards of other welfare obligations to its citizens. And again, the ‘first come
first serve’ model if would have been followed by the government at the outset – much
waiting for all the bidders for the completion of the processual requirements would have the
most valuable factor, i.e., the time which would adversely affect the government substantially
as well. The Government of Endor apprehended this situation of outburst of cancer in Endor
26
Sachidanand Pandey v. State of West Bengal (1987) 2 SCC 295.
27
Health Situation in the South-East Asia Region 2001-2007, WHO Regional Office for South-East Asia, p.
126, available at http://apps.searo.who.int/PDS_DOCS/B3226.pdf
28
Ibid, p. 127.
29
Ibid, p. 118.
30
Ibid, p. 128.

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region and took the just decision to change the policy of distribution of right to mine from
auction to first come first serve basis in order to prevent such possible cancer outbreak in
future. Thus, taking immediate measures considering the immediacy of the public health as
well as to strengthen the Exchequer as well the policy adopted by the government was just,
legal and appropriate.
The Government was concerned for the people of Endor, as out-of-pocket payment for the
treatment of cancer could economically devastate families and individuals. Thus, the creation
of appropriate financing mechanisms to cover the cost of treatment needs to be addressed 31
which is efficiently attempted by the government in the light that improvement of public
health is an obligation on the government under Art. 47 of the Constitution of Endor. The
Government by its order32, constituted a Committee to review the National Mineral Policy,
1993 and the Mines and Minerals (Development and Regulation) (MMDR) Act, 1957 and
suggest the changes needed for encouraging investment in public and private sector in
exploration and exploitation of minerals. Thus, Government of Endor as developing nation
and for the welfare of its citizens has tried the PPP [Public-Private Participation] model in
different policies for 16 years to serve the purposes of governance of the subjects in most
efficient and effective manners.

3. WHETHER OR NOT the order of Hon’ble High Court to quash the leases was just
and against the interests of foreign share-holders?

Rights of Foreign Investors:

Endor by following the PPP model has accentuated the sustaining growth of its economy and
prompted it to be the destination for foreign investors ultimately resulting in the visibility of
Endor into foreign markets. The quashing order of Lease of the High Court without
considering the interest of foreign investors in the instant case would not only adversely
affect the growth of the economy of the country rather would attract the reflective loss of the
foreign shareholders as well. In the international law on diplomatic protection and substantive
corporate rights, has assumed a vital and indispensable role in the commercial world of South
East Asian countries33. Shareholders in companies can be harmed in two broadly different
ways: First, they can suffer direct injury to their rights as shareholders, for example, the right
to attend and vote at general meetings etc and second, the injury that can be suffered by
shareholders of a company is reflective loss through an injury to the company; for an act that
injures the company affects its overall value 34. Shareholders are in effect allowed to bring
claims for reflective loss only under specified conditions, which frequently include, inter
alia, recovery going to the company rather than the claimant shareholder 35. Also, the ICJ has
recognized that States may agree in a treaty to vary the principles applicable under general

31
Ibid.
32
Order No-I&M25(3)/2005, dated 14 September 2005.
33
DIPP, GOI data till 2010. Available at http://www.investindia.gov.in/InvestIndia_Brochure_web.pdf
34
Investment Treaies as Corporate Law : Shareholder Claims and issues of Consistence, David Gaukrodger, p.
13. Available at http://www.oecd.org/corporate/WP-2013_3.pdf
35
Id at pg. 20.

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international law for the purposes of the treaty. States may thus agree to modify the general
principles to permit certain claims based on reflective loss by the shareholders 36. Further, by
referring to all the BITs of India, a common clause that can be perceived states that the host
state would be responsible for any loss suffered by the shareholders of the foreign contracting
state37.
Criminal Conspiracy between the minority stakeholders and government officials involved:
According to the proviso to the section 120A, IPC, 1860 in case of a conspiracy to commit an
offence, the mere agreement is sufficient to impose liability; however, in the case of a
conspiracy to do a legal act by illegal means, there ought to be some overt act which should
have been committed by one or more parties to the agreement, apart from the agreement
itself38.
Considering the meaning of the term ‘illegal’ u/s 43 of IPC, significance of these two forms
of criminal conspiracy and the requirement of an overt act becomes evident. Thus, the overt
act in question must be either an offence, be an act prohibited by law or must give rise to a
civil action. Here, the act of the government granting license to the Petitioners is not illegal
per se. However, the allegation that the government officials had been bribed for such a grant
is of primary importance here. As such act of accepting or giving bribe would be the overt act
in question. The offence of criminal conspiracy can only be proved largely from inferences
drawn from acts of illegal omissions committed by the conspirators in pursuance of a
common design39 40.While considering the nature of proof requisite to prove conspiracy, it is
not necessary to prove that the perpetrators expressly agreed to do or cause to be done an
illegal act, the agreement could be proved by necessary implication41.
The fact that the promoters of the company did not inform and sought permission from RBI
as per the requirements provided u/s 3 of FEMA, 1999. In the Year 1992, lease was granted
on the basis of upfront lease rental, whereas, in the year 1994 it was granted to a government
on the same lease rental. It was decided to hold a public auction as 6 years had passed but, in
the year 2005, it was 7 years since the upfront lease rental was fixed, but the government not
to fix the upfront lease rental afresh, this act was colored by corruption which might result in
the economic injury to the country. This decision of the government was taken at a time when
not only the attempt to address the primary concerns on public health and reducing the life-
saving drug in affordable prices to the citizens were accounted rather the inflation rates in
South - East Asian countries had also soared42.

36
Ibid at pg. 23.
37
Available at http://finmin.nic.in/bipa/bipa_index.asp [India is party to 71 BITs till 2010]
38
Mohd Khalid v. State of West Bengal (2002) 7 SCC 334; Devender Pal Singh v. State (NCT of Delhi) AIR
2002 SC 1661[the broad essentials of criminal conspiracy in India were summarized to be as follows: (i) an
object to be accomplished; (ii) a plan or a scheme embodying means to accomplish that object; (iii) an
agreement or understanding between two or more of the accused persons; (iv) an overt act, in pursuance of the
agreement in case of a non-offence act.]
39
Shivanarayan Laxminarayan Joshi v. State of Maharashtra AIR 1980 SC 439; Kehar Singh v. State (Delhi
Administration) AIR 1988 SC 1883, State of Kerala v. P Sugathan (2000) Cr L J 5484 (SC); State (NCT of
Delhi) v. Jaspal Singh (2003) 10 SCC 586.
40
Shivanarayan Laxminarayan Joshi v. State of Maharashtra AIR 1980 SC 439; Sattan alias Satyendra & Ors v.
State (2001) CRLJ 676 (All)
41
Mohd Usman Mohd Hussain Maniyar v. State of Maharashtra AIR 1981 SC 1062; Lal Singh v. State of
Gujarat (2001) CrLJ 978 (SC); Yogesh v. State of Maharashtra (2008) 10 SCC 394.

XXI
 ~WRITTEN SUBMISSIONS for THE

APPELLANT~
Lifting up of Corporate Veil

A corporation is a distinct entity yet in reality, it is an association of persons who are in fact
the beneficiaries of the corporate property43 and when the company commits any frauds or
improper or illegal acts, it is in the interest of the members in general or in public interest to
identify and punish the persons the lifting of corporate veil is applied in order to book and
punish who misuse the medium of corporate personality 44. The circumstance under which the
courts may lift the corporate veil also includes cases involving economic offences. In
Santanu Ray v Union of India45, it was held that in case of economic offences, court was
entitled to lift the veil of the corporate entity and pay regard to the economic realities behind
the legal façade.
In the case, the act of company’s promoters to conspire with the government officials in order
to get the grant of license is an economic offence 46. Thereby, the Petitioner/s submits that the
decision of the HC to quash the leases has erroneously affected the bona fide foreign
investors and thereby on lifting the Corporate Veil, the minority promoter shareholders
should be held liable.

42
IMF, World Economic Outlook Database, April 2007. Available at
https://www.imf.org/external/pubs/ft/weo/2007/01/data/weorept.aspx?
sy=1998&ey=2005&scsm=1&ssd=1&sort=country&ds=.&br=1&pr1.x=29&pr1.y=5&c=510&s=NGDP_RPCH
%2CPCPIPCH&grp=1&a=1
43
Gallaghar v. Germania Brewing Company [1893] 53 MINN 214.
44
Taxmann’s Company Law and Practice, A K Majumdar, Dr. G K Kapoor, 16th edn, 2011,p 19
45
Santanu Ray v Union of India 1988 (18) ECC 51.
46
Section 7, Prevention of Corruption Act, 1988.

XXII
 P RAYER F OR R ELIEF

In the light of facts stated, issues raised, arguments advanced and authorities cited, the

petitioner most humbly and respectfully pray and request the Honourable court:

1) TO ALLOW THE APPEAL.

2) TO PASS THE ORDER AGAINST Platinum group for committing wilful MEDICAL

NEGLIGENCE AND MISMANAGEMENT DONE BY THEM IN THE FORM OF NEGLIGENCE.

3) TO GRANT ANY OTHER RELIEF WHICH THE HON’BLE COURT MAY DEEM THINK FIT IN

THE EYES OF JUSTICE, EQUITY AND GOOD CONSCIENCE.

All of which is respectfully submitted and for such act of kindness the petitioner shall be duty

bound and shall ever pray.

Sd/-

COUNSEL FOR THE APPELLANT