UNIT 1:

DRAFTING
Types of Documents
INTRODUCTION
• General Clauses Act, 1897 has given an inclusive definition of document. According to
section 3(18), “document” shall include any matter written, expressed or described upon
any substance by means of letters, figures or marks, or by more than one of those means
which is intended to be used, or which may be used, for the purpose of recording that
matter.
• IT Act provides that “electronic record” means data, record or data generated, image or
sound stored, received or sent in an electronic form or micro film or computer generated
micro fiche.
DEEDS
A deed is a writing-
(a) on paper, vallum or parchment,
(b) sealed, and
(c) delivered, whereby an interest, right or property passes, or an
obligation binding on some persons is created or which is in affirmance
of some act whereby an interest, right or property has been passed.

A deed is a present grant rather than a mere promise to be performed in

the future. Deeds are in writing, signed, sealed and delivered
Types of Agreements
1. Sale/Purchase Agreements:
2. Commercial Agency Agreements:
3. Collaboration Agreements
4. Arbitration Agreements:
5. Hypothecation Agreement
6. Outsourcing Agreements:
7. Agreement for Assignment:
8. Shareholders’ Agreement
9. Employment Agreements
CIRCULARS
The purpose of circulars is to disseminate the information to large number of individuals.

Important Points for drafting a circular:

1. Issuing Authority: mention the name of the issuing authority on the circular for communicating the position
and authority of the addressor.

2. Details of Addressee: The addressees are required to comply with the information specified a circular.

3. Subject: The mention of subject in a circular ensures that the circular receives the required attention

4. Reference to Preceding information: information already provided before the present circulars.

5. Main Information: The information should be complete and in understandable language

6. Signature
 PUBLIC NOTICES
• Theseareannouncementsmadeon a happeningof a certaineventof public
interest.Thesemaybe issuedby a GovernmentAgencyor by an individualincluding
organisations
• Drafting of Public notice
• 1 Name of the Issuer
• 2. Details of the
• 3. Title Heading.
• 4. Comprehensive Details
• 5. Statutory/Regulatory Requirement
• 6. Date and Place
• 7. Designation of the issuer
STANDARD BIDS AND TENDERS
• It refers to an invitation to offer (bid) for a purpose. The process of inviting bids for tenders have
been initiated frequently by the organisations for large projects. It encourages the availability of
goodsor services on competitiveprices.
 Important considerations
 Name and address of the organisation
 Subject of the document
 Important dates and necessary information: The information such as Tender Publication Date, Last date and time
for sending Pre-Bid Queries in writing, Cost of Tender, Earnest Money Deposit, Pre-Bid Meeting date, time C venue
etc
 Disclaimer Clause
 Job Description
 Division of tender documents in parts: The tender document be preferably prepared asking for Bid submissions in
two parts i.e. Technical Bid and Financial Bids.
 Fees and Deposits: The cost of the tender document may be required from the prospective bidder
 Conditions for forfeitures of EMD: i. If the bidder withdraws its bid; ii. the selected bidder delays or does not accept
the Purchase /Work Order; iii. the selected bidder fails to supply goods /services as per the terms of the Tender or
fails to execute Purchase /Work Order.
 Pre Bid Meeting
 Eligibility Criteria: Essential Requirements are to be mentioned in the tender document.
LETTER OF CREDIT, BANK GUARANTEE, AND PERFORMANCE
GUARANTEE
1. Applicant Bank: Applicant or he is also called as Opener of LC. The bank opens LC on behalf of the applicant
customer who is buyer /importer of goods.
2. Issuing Bank: Issuing bank is a bank which opens LC and undertakes to make payment to the beneficiary
(seller/ exporter) on submission of document as per the terms of LC.
3. Beneficiary: Beneficiary is the seller /exporter of goods in whose favour LC is opened.
4. Advising Bank: Advising Bank is the bank through whom LC is advised to the beneficiary. Normally it is located
in seller’s location /country.
5. Confirming Bank: The bank which in addition to LC issuing bank, undertakes the responsibility of payment
under LC.
6. Negotiating Bank: The Bank that negotiates the documents under LC.
7. Paying Bank: Paying Bank or Nominated Bank is the bank nominated or authorized by the LC issuing bank to
make payment under LC. In practice, the paying bank presents the documents received by it either to issuing
bank or Reimbursing Bank for payment and transfers the proceeds to the beneficiary’s account.
8. Reimbursing Bank: Bank with whom the LC issuing bank maintains foreign currency account (NOSTRO
account).
Types of Bank Guarantees
1. Financial Guarantee: Under this, bank guarantees that the applicant
meet the financial obligation and in case he fails, the bank as a
guarantor is bound to pay

2. Performance Guarantee: Under this, guarantee issued is for honouring a

particular task and completion of the same in the prescribed / agreed
upon manner as stated in the guarantee document
BYE LAWS
A bye law is a law which is made by a local authority and which applies
only in their area. So, certain organisations frame their Bye Laws for
effective functioning. Bye-Laws are legal tools used to regulate a particular
subject or area so as to achieve orderly development of that subject.

The legal recognition of Bye Laws are as under: According to Article

13(3)(a) of the Constitution of India, “law” includes any Ordinance, order,
bye-law, rule, regulation, notification, custom or usage having in the
territory of India the force of law;
 SHOW CAUSE NOTICE (SCN):
A show cause notice is a document delivered to other party to represent the matter. It summaries the alleged
matter and grants the other party an occasion to explain themselves
Essentials:
1 SCN should contain the name of the issuer.
2 It should be issued in writing.
3 It should be written in clear language in order to avoid ambiguity.
4 It should mention the correct and brief facts.
5 If there is a violation of Law, it should be specifically mentioned.
6 Charges should be levelled specifically and they should be vague or in contradiction with the information
contained in SCN.
7 Proposed action should also be mentioned in the SCN. For eg. Penalty, Legal action, Suspension etc.
8 The time limits that have been provided to the receiver should be mentioned in the notice.
9 Adequate time limit should be given for the reply, unless otherwise specifically provided by any law.
 STANDING ORDERS
The Industrial Employment (Standing Orders) Act (said Act) requires employers in industrial
establishments to clearly define the conditions of employment by issuing standing orders duly certified. It
applies to every establishment wherein 100 or more workmen are employed or were employed on any day
during the preceding twelve months.
Matters to be provided in standing order :
1. Classification of workmen, e.g., whether permanent, temporary, apprentices, probationers, or badlis.
2. Manner of intimating to workmen periods and hours of work, holidays, paydays and wage rates.
3. Shift working.
4. Attendance and late coming.
5. Conditions of, procedure in applying for, and the authority which may grant, leave and holidays.
6. Requirement to enter premises by certain gates, and liability to search
7. Suspension or dismissal for misconduct, and acts or omissions which constitute misconduct.
Means of redress for workmen against unfair treatment or wrongful exactions by the employer or his
agents or servants.
 BONDS
• A bail bond is an undertaking by an accused to appear for trial or to
pay a sum of money stated therein on non-compliance.
Agar shuru karne ki himmat thi toh...

Khatam karne se kyu Ghabre rahe ho?

STUDY HARD
 DRAFTING
D R A FT I N G M AY B E D E FI N E D
A S TH E SYN TH ESIS O F LAW
A N D FA C T I N A L A N G U A G E
FO R M
IMPORTANT POINTS RELATED TO
DRAFTING:
• Drafting is first thinking (conceptual phase)and second composing(Verbal phase).
• Drafting is to collect, consolidate and co-ordinate the facts in the form of a document, it requires
serious thinking followed by prompt action to reduce the available information into writing with a
legal meaning,open for judicial interpretation to derive the same sense and intentions of the parties
with which and for which it has been prepared, adopted and signed.
• A draftsman must obtain particulars about all necessary matters which are required to form part of
the instrument
• Drafting includes conveyancing.
(What is conveyancing?
Conveyancing is the art of drafting of deeds and documents whereby land or interest in land i.e.
immovable property, is transferred by one person to another)
 DRAFTING INCLUDES

DOCUMENT:“DOCUMENT” AS DEFINED IN SECTION

31(18) OF GENERAL CLAUSES ACT, 1894 MEANS ANY INSTRUMENT AS DEED: INSTRUMENT AS
MATTER EXPRESSED OR DESCRIBED UPON ANY INCLUDING EVERY INCLUDING EVERY DOCUMENT
BY WHICH ANY RIGHT OR
SUBSTANCE BY MEANS OF LETTERS, FIGURES OR DOCUMENT BY WHICH LIABILITY IS OR PURPORTED TO
MARKS, OR BY THE MORE THAN ONE OF THOSE ANY RIGHT OR LIABILITY BE CREATED ,TRANSFERRED,
MEANS, INTENDED TO BE USED, OR WHICH MAY BE IS OR PURPORTED TO BE LIMITED, EXTINGUISHED OR
USED, FOR THE PURPOSE OF RECORDING THAT CREATED ,TRANSFERRED, RECORDED
MATTER LIMITED, EXTINGUISHED
OR RECORDED
DOCUMENT

INSTRUMENT

DEED
 FOWLER’S 6 PRINCIPLES OF
DRAFTING
Prefer the familiar word to the far fetched (familiar words are readily
understood).

Prefer the concrete word to the abstract (concrete words make meaning more
clear and precise).

Prefer the single word to the circumlocution (single word gives direct meaning
avoiding adverb and adjective).

Prefer the Saxon word to the Roman (use of Roman words may create
complications to convey proper sense to an ordinary person to understand)

Prefer the short word to the long (short word is easily grasped).

Always prefer active voice to the passive voice in the drafting of documents.
DO’S DONTS’
(a) Avoid the use of words of same sound.
1. Reduce the group of words to single word; For example,the words “Employer” and
2. Use simple verb for a group of words; “Employee”;
3. Avoid round-about construction; (b) When the clause in the document is
4. Avoid unnecessary repetition; numbered it is convenient to refer to any one
5. Write shorter sentences; clause by using single number for it.For
example,“in clause 2 above” and so on.
6. Express the ideas in fewer words;
7. Prefer the active to the passive voice sentences; (c) Negative in successive phrases would be
8. Choose the right word;
very carefully employed.
9. Know exactly the meaning of the words (d) Draftsman should avoid the use of words
“less than” or “more than”,instead,he must
and sentences you are writing; and
use “not exceeding”.
10. Put yourself in the place of reader,
(e) If the draftsman has provided for each of
read the document and satisfy yourself about
the two positions to happen without each
the content, interpretation and the sense it carries other and also happen without,“either” will
not be sufficient;he should write“either or
both” or express the meaning of the two in
other clauses
IMPORTANT TERMS OF DEED
• D E E D P O O L :A deed between two or more parties where as many copies
are made as there are parties,so that each may be in a possession of a copy.
This arrangement is known as deed pool.
• D E E D POLL :A deed made and executed by a single party e.g.power of
attorney, is called a deed poll, because in olden times, it was polled or cut level
at the top. It had a polled or clean cut edge.
• I N D E N TU RE : Indenture are those deeds in which there are two or more
parties. It was written in duplicate upon one piece of parchment and two
parts were severed so as to leave an indented or vary edge, forging being then,
rendered very difficult.
• C Y R O G R A P H U M :This was another type of indenture in olden times.The
word “CYROGRAPHUM” was written between two or more copies of the
document and the parchment was cut in a jugged line through this word.
• D E E D E S C R O W :A deed signed by one party will be delivered to another
as an “escrow” for it is not a perfect deed. It is only a mere writing (Scriptum)
 Various Kinds of Deeds
A good deed is one which conveys a good title, not one which is good merely in form.

A good and sufficient deed is marketable deed; one that will pass a good title to the
land it purports to convey.

An inclusive deed is one which contains within the designated boundaries lands which
are expected from the operation of the deed. 41PP-DP&A General principles of
Drafting

A latent deed is a deed kept for twenty years or more in man’s escritoire or strong
box. A lawful deed is a deed conveying a good or lawful title. l A pretended deed is a
deed apparently or prima facie valid.

A voluntary deed is one given without any “valuable consideration”, as that term is
defined by law, one founded merely on a “good”, as distinguished from a “valuable”,
consideration on motives of generosity and affection, rather than a benefit received
by the donor, or, detriment, trouble or prejudice to the grantee.
A warranty deed is a deed containing a covenant of warranty.

A special warranty deed which is in terms a general warranty deed, but warrants title
only against those claiming by, through, or under the grantor, conveys the described
land itself, and the limited warranty does not, of itself, carry notice of title defects.
TYPES OF RECITAL

NARRATIVE RECITAL: Narrative recitals

which relates to the past history of the
property transferred and sets out the
facts and instrument necessary to show
the title and relation to the party to the
subject matter of the deed as to how the
property was originally acquired and I N T R O D UC T OR Y RECITAL: They are
held and in what manner it has developed placed after narrative recitals.The basic
upon the grantor or transferor objective of doing so, is to put the events
relating to change of hand in the property.
 OPERATIVE PART
• TESTATUM :This is the “witnessing” clause which refers to the introductory recitals of the
agreement,if any,and also states the consideration, if any,and recites acknowledgement of its receipt.
• CONSIDERATION: Mention of consideration is necessary for ascertaining stamp duty payable on the
deed under the Indian Stamp Act, 1899.There is a stipulation of penalty for non-payment of stamps,
but non-mention of consideration does not invalidate the document.
• HABENDUM: Habendum is a part of deed which states the interest, the purchaser is to take in the
property.
• REDDENDUM This is peculiar to a deed of lease. Here is mentioned this mode and time fixed for the
payment. It begins with the word “RENDERING OR PAYING”.
• COVENANTS A N D UNDERTAKING: A covenant is a promise by the parties by which either of the
parties pledge to do something. Covenant clause includes undertakings also.
• EXCEPTIONS A N D RESERVATIONS: It refers to admission of certain rights to be enjoyed by the
transferor over the property to be agreed to by the transferee. Eg in the sale transaction if the
owner wants to retain with him the upper floor that can mention in this clause.
 FORMAL PART
• TESTIMONIUM: Testimonium signifies that the parties to the document have signed the deed.
• SIGNATURES A N D ATTESTATION CLAUSE : Where a deed requires attestation then the
executants, must sign in the presence of their witnesses must sign in the presence of the
executants.
• ANNEXURES A N D SCHEDULE OF THE PROPERTY : A deed remains incomplete unless
particulars as required under registration law about the land or property are given in the
Schedule.
• ENDORSEMENT A N D SUPPLEMENTARY DEED:
1. Supplemental deed is a document which is entered into between the parties on the same
subject on which there is a prior document existing and operative for adding new facts to the
document on which the parties to the document have agreed.
2. Endorsement means to write on the back or on the face of a negotiable instrument.
IMPORTANT TERMS AND CONDITIONS IN THE
AGREEMENT
1.Description of Parties to the Contract
2.Legal Nature of the Contract
3.Licences and Permits
4.Taxes, Duties and Charges
5.Quality, Quantity and Inspection of Goods
6.Packing
7.Shipment of the Goods
8.Insurance
9.Documentation
10.Guarantee
11.Passing of the Property and Passing of the Risks
12.Amount, Mode and Currency of Payment
13.Force Majeure
14.Proper Law of Contract
15.Settlement of Disputes through Alternate Dispute Resolution (ADR)
 GUIDELINES FOR USE OF PARTICULAR WORDS AND PHRASES FOR
DRAFTING AND CONVEYANCING
The guidelines for using particular words and phrases in drafting and conveyancing
emphasize the importance of clarity and precision. While there are no strict rules,
the following points serve as helpful recommendations for draftsmen:
1.General Words: Refer to a standard dictionary, like Oxford or Webster’s, for the
meaning of ordinary words.
2.Legal Terms: Use legal dictionaries, such as Wharton’s Law Lexicon or Mitra’s Legal
and Commercial Dictionary, to understand legal terms.
3.Current Usage: Use the current meaning of words, and refer to case law when
necessary for clarification.
4.Technical Terms: Ensure full understanding of technical words before using them,
considering their special meaning in the context.
5.Clarity of Intention: Choose words and phrases that convey the executor's intended
meaning clearly to the reader.
6.Interpretation of Statutes: Refer to authoritative legal works, such as Maxwell’s
Interpretation of Statutes, for guidance on word usage.
These guidelines aim to ensure precision and clarity in legal drafting.
Legal Implications and Requirements
Drafting of documents is very important part of legal documentation. Documents are
subject to interpretation when no clear meaning could be inferred by a simple
reading of the documents. The legal implications of drafting, therefore, may be
observed as under:

Double and doubtful meaning of the intentions given shape in the document.
Inherent ambiguity and difficulties in interpretation of the documents.
Difficulties in implementation of the objectives desired in the documents.
Increased litigation and loss of time, money and human resources.
Misinterpretation of facts leading to wrongful judgement.
Causing harm to innocent persons.
 STAMPING OF THE DEEDS
The document draft must be approved by the relevant parties, such as a company's
Board of Directors or a duly constituted committee, via a resolution. Once approved,
the document is engrossed onto non-judicial stamp paper of the appropriate value
under the Indian Stamp Act. If the document is on plain paper and approved without
changes, it can be submitted to the Collector of Stamps for adjudication, who will
endorse payment of stamp duty, making it ready for execution.

E-stamping is a secure, electronic method of paying stamp duties, replacing the

traditional physical stamp paper and franking system. Managed by the Stock Holding
Corporation of India Limited (SHCIL), e-stamping offers several benefits, including
time efficiency, easy accessibility, cost savings, tamper-proof certificates, unique
identification numbers, and user-friendliness.
Ache ‘RESULTS’ Lane k liye,
Baato se nahi..

Raato se ladhna padta hai..

STUDY HARD
 UNIT 3
Laws relating to drafting and
conveyance

SOMYA KATARIA (CS, MBA): 9131993373

COMMUNICATION, ACCEPTANCE AND
REVOCATION OF PROPOSALS
Proposal has been defined in section 2(a) of the Indian Contract Act, 1872, as under:
When one person signifies to another his willingness to do or to abstain from doing anything, with a view to
obtaining the assent of that other to such act or abstinence, he is said to make a proposal.

Essentials of a proposal
1. There should be at least 2 persons.
2. One person should express his willingness to do or abstain from doing an Act or abstinence.
3. The purpose should be to obtain the assent of the other on the same thing.

Kinds of Offers
There are generally 7 types of offers:
General offers Open/Standing offer
Cross offers Contracts by post
Counter offers Contracts over the telephone
Specific offer
CS SOMYA KATARIA (9131993373)
 Rules governing Offers
A valid offer must comply with the following rules:
(a) must be clear, definite, complete and final.

(b) An offer must be communicated to the offeree.

(c) The communication of an offer may be made by express words-oral or written-or it may be
implied by conduct.

(d) The communication of the offer may be general or specific.

CS SOMYA KATARIA (9131993373)

 Offer and invitation to offer
Invitation to offer is a communication to invite certain person(s) or public for making offer.

An offer that has been communicated properly continues as such until it lapses, or until it is revoked by the
offeror, or rejected or accepted by the offeree.

Communication
According to section 3 of the Indian Contract Act, 1872, the communication of proposals, the acceptance of
proposals, and the revocation of proposals and acceptances, respectively, are deemed to be made by any act
or omission of the party proposing, accepting or revoking by which he intends to communicate such proposal,
acceptance or revocation, or which has the effect of communicating it.

Completion of Communication:

❑ Proposal
❑ Acceptance
❑ Revocation

CS SOMYA KATARIA (9131993373)

Acceptance:
A proposal on acceptance becomes a promise. Every promise or set of promises forming consideration for each
other become agreement.

What is a valid acceptance?

CS SOMYA KATARIA (9131993373)

The essentials of valid contracts are:
1) Valid Agreement as per section 2(e) of Indian Contract Act, 1872
2) Free Consent of the parties
3) Competence of Parties
4) Valid Consideration
5) Lawful Object
6) Agreement not declared Void.

CONTINGENT CONTRACTS
According to section 31 of ICA, a contingent contract is a contract to do or not to do something, if some event,
collateral to such contract, does or does not happen.

CS SOMYA KATARIA (9131993373)

Section 13 of the Indian Contract Act (ICA) defines "consent"
as the agreement of two or more parties on the same thing in
the same sense. Section 14 further explains that consent is
considered "free" when it is not influenced by factors such as:

1.Coercion (Section 15)

2.Undue influence (Section 16)
3.Fraud (Section 17)
4.Misrepresentation (Section 18)
5.Mistake (Sections 20, 21, and 22)
Consent is not free if it would not have been given without the
presence of any of these factors.

CS SOMYA KATARIA (9131993373)

Competence of Parties and Valid Consideration in Contract Law
1.Competence of Parties: A person is competent to contract if:
•They are of the age of majority (18 years or 21 years in some cases, as per the Indian Majority Act, 1875).
•They are of sound mind (capable of understanding the contract and forming rational judgment).
•They are not disqualified by any law (e.g., alien enemies, foreign sovereigns, certain individuals under
specific laws like the Oudh Land Revenue Act).
Categories of people not competent to contract:
•Minors: Persons under 18 years (or 21 in case of guardianship).
•Persons of Unsound Mind: Those who cannot understand the nature and consequences of their actions.
•Persons Disqualified by Law: Includes alien enemies, foreign sovereigns, and individuals disqualified under
specific laws.
2.Valid Consideration:
•As per Section 2(d) of the Indian Contract Act (ICA), consideration refers to something done or promised by
the promisee or another person at the desire of the promisor.
•Essentials of Consideration:
•It must be at the desire of the promisor.
•It can be executed (present) or executory (future), and may also be based on past acts or forbearance.
•In English law, consideration must come from the promisee, but under Indian law, it can come from a
stranger as well.
This outlines the competence of parties and the essential aspects of consideration in contract law.
CS SOMYA KATARIA (9131993373)
Privity of Consideration in India:
•Privity of Consideration: In India, the doctrine is not strictly applicable. This means that consideration can be
provided by a party or any third person. However, privity of contract still applies, meaning a contract cannot
impose rights or obligations on a third party, except in cases such as trusts, covenants running with land, and
family settlements.
Rules Governing Consideration:
1.Value of Consideration: Every contract must be supported by valuable consideration to be valid, except in
certain cases.
2.Types of Consideration: Consideration can be an act, abstinence, or promise.
3.Mutuality: There must be a mutual exchange, i.e., each party must do or agree to do something.
4.Clarity of Consideration: It must be clear, real, and not vague. For instance, a vague promise like “stop being a
nuisance” is not valid consideration.
5.Adequacy of Consideration: The consideration need not be adequate, though it must have some value.
6.Lawfulness: If the consideration is unlawful, the agreement is void.
7.Beyond Existing Obligation: Consideration must be something more than what the promisee is already bound
to do.
Exceptions to Consideration (Section 25 of ICA):
An agreement without consideration is void unless:
1.It is expressed in writing, registered, and made due to natural love and affection between parties in a near
relationship.
2.It is a promise to compensate someone who has already voluntarily done something for the promisor or fulfilled a
legal obligation.
3.It is a written promise to pay a debt, which the creditor could have enforced but for the limitation of suits.
CS SOMYA KATARIA (9131993373)
Lawful Object (Section 23 of ICA):
•Lawful Object: Consideration or object of an agreement is lawful unless:
• Forbidden by law,
• It defeats any law,
• Fraudulent,
• Implies harm to another's person or property,
• Immoral or against public policy.
Types of Agreements Void under the Indian Contract Act:
1.Minor or Unsound Mind: Agreements with a minor, unsound mind, or a disqualified person (Section 11).
2.Mistake of Fact: Agreement made under a mutual mistake of fact (Section 20).
3.Unlawful Consideration/Objects: Agreement with unlawful consideration or object (Section 23).
4.Partial Unlawfulness: If part of the consideration is unlawful (Section 24).
5.No Consideration: Agreement without consideration, unless exceptions apply (Section 25).
6.Restraint of Marriage: Agreements in restraint of marriage (Section 26).
7.Restraint of Trade: Agreements in restraint of trade (Section 27).
8.Restraint of Legal Proceedings: Agreements in restraint of legal proceedings (Section 28).
9.Uncertain Meaning: Agreements with unclear or uncertain terms (Section 29).
10.Wagering Agreements: Agreements made by way of wager (Section 30).
11.Future Agreements: Agreements to enter into an agreement in the future.
12.Impossible Acts: Agreements to do something impossible (Section 56(1)).
Conclusion:
In India, for a contract to be valid, there must be consideration, lawful object, and the agreement must not fall under
the categories deemed void by the Indian Contract Act. Certain exceptions allow for agreements without
CS SOMYA
consideration, but they are limited to specific cases.KATARIA (9131993373)
1. Lawful Object
According to section 23 of ICA, the consideration or object of an agreement is lawful, unless:

1 it is forbidden by law; or
2 is of such a nature that if permitted, it would defeat the provisions of any law;
3 is fraudulent; or
4 involves or implies injury to the person or property of another; or 5 the Court regards it as immoral, or
opposed to public policy.

CS SOMYA KATARIA (9131993373)

 Agreement not declared Void
◦ The following types of agreements are void under Indian Contract Act

A)Agreement by or with a minor or a person of unsound mind or a person disqualified to enter into a contract - Section 11.
B) Agreement made under a mistake of fact, material to the agreement on the part of the both the parties - Section 20.
C) An agreement of which the consideration or object is unlawful - Section 23.
D)If any part of a single consideration for one or more objects, or any one or any part of any one of several considerations for a
single object, is unlawful, the agreement is void - Section 24
E) An agreement made without consideration subject to three exceptions provided to Section 25.
F) An agreement in restraint of marriage - Section 26.
G) An agreement in restraint of trade - Section 27.
H) An agreement in restraint of legal proceedings - Section 28.
I) Agreements, the meaning of which is not certain, or capable of being made certain - Section 29
J) Agreement by way of wager- Section 30.
K) An agreement to enter into an agreement in the future.
L) An agreement to do an act impossible in itself - Section 56(1).

CS SOMYA KATARIA (9131993373)

 PART – B: SPECIFIC RELIEF ACT, 19637. Power of sale
◦ Section 6 provides if any person is dispossessed without his consent of immovable property otherwise than in due course of law, he
may, by suit, recover possession.

◦ However, no suit under section 6 should be brought:

A. after the expiry of six months from the date of dispossession;
B. oragainst the Government

• Recovery of specific movable property:

any person having the possession of movable property, of which he is not the owner, may be compelled specifically to deliver it to
the person entitled to its immediate possession, in any of the following cases: –
a. when the thing claimed is held by the defendant as the agent or trustee of the plaintiff;
b. when compensation in money would not afford the plaintiff adequate relief for the loss of the thing claimed;
c. when it would be extremely difficult to ascertain the actual damage caused by its loss;
d. when the possession of the thing claimed has been wrongfully transferred from the plaintiff.

CS SOMYA KATARIA (9131993373)

 Specific Performance of Contracts

The court may direct the specific performance of a part of a contract only as per the provisions provided under section 12 of SRA which
are as follows:
1 Where a party to a contract is unable to perform the whole of his part of it, but the part which must be left unperformed be a only a small
proportion to the whole in value and admits of compensation in money, the court may, at the suit of either party, direct the specific
performance of so much of the contract as can be performed, and award compensation in money for the deficiency.

2 Where a party to a contract is unable to perform the whole of his part of it, and the part which must be left unperformed either—
A. forms a considerable part of the whole, though admitting of compensation in money; or
B. does not admit of compensation in money; he is not entitled to obtain a decree for specific performance; but the court may, at the suit of
the other party, direct the party in default to perform specifically so much of his part of the contract as he can perform
C.a party to a contract shall be deemed to be unable to perform the whole of his part of it if a portion of its subject-matter existing
at the date of the contract has ceased to exist at the time of its performance.

CS SOMYA KATARIA (9131993373)

Rights of purchaser or lessee against person with no title or
imperfect title

Where a person contracts to sell or let certain immovable property having no title or only an imperfect title,
the purchaser or lessee has the following rights, namely:

(a) if the vendor or lessor has subsequently to the contract acquired any interest in the property, the purchaser or lessee may compel him to
make good the contract out of such interest;

(b) where the concurrence of other person is necessary for validating the title, and they are bound to concur at the request of the vendor or
lessor, the purchaser or lessee may compel him to procure such concurrence, and when a conveyance by other persons is necessary to validate
the title and they are bound to convey at the request of the vendor or lessor, the purchaser or lessee may compel him to procure such
conveyance;

(c) where the vendor professes to sell unencumbered property, but the property is mortgaged for an amount
not exceeding the purchase money and the vendor has in fact only a right to redeem it, the purchaser may compel him to redeem the mortgage
and to obtain a valid discharge, and, where necessary, also conveyance from the mortgagee;

CS SOMYA KATARIA (9131993373)

Exceptions of specific performance:

According to section 14, the following contracts cannot be specifically enforced,

namely:

a. where a party to the contract has obtained substituted performance of contract

b. a contract, the performance of which involves the performance of a continuous

duty which the court cannot supervise;

c. a contract which is so dependent on the personal qualifications of the parties that the court cannot enforce

specific performance of its material terms; and

d. a contract which is in its nature determinable.

SOMYA KATARIA (CS, MBA): 9131993373

CS SOMYA KATARIA (9131993373)

 Who may obtain specific performance

A. any party thereto;

B. the representative in interest or the principal (Exception: personal qualifications/creativity)

C. where the contract is a settlement on marriage, or a compromise of doubtful rights between members of the same
family, any person beneficially entitled thereunder;
D. where the contract has been entered into by a tenant for life in due exercise of a power, the remainderman;
E. a reversioner in possession, where the agreement is a covenant entered into with his predecessor in title and the
reversioner is entitled to the benefit of such covenant;
F. a reversioner in remainder, where the agreement is such a covenant, and the reversioner is entitled to the benefit
thereof and will sustain material injury by reason of its breach;
G. when a limited liability partnership has entered into a contract and subsequently becomes amalgamated with another
limited liability partnership, the new limited liability partnership which arises out of the amalgamation.
H. when a company has entered into a contract and subsequently becomes amalgamated with another company, the new
company which arises out of the amalgamation;

CS SOMYA KATARIA (9131993373)

key provisions related to the specific performance of contracts under the Specific Relief Act (SRA):
1.Non-availability of Specific Performance (Section 14): A person cannot enforce specific performance of a contract if:
1. They have obtained substituted performance under Section 20.
2. They are incapable of performing their obligations, violate essential terms, or act fraudulently or contrary to
the contract's intent.
3. They fail to prove that they were always ready and willing to perform their part, except for terms prevented
or waived by the other party.
2.Contract to Sell or Let Property Without Title (Section 17): A contract to sell or lease immovable property cannot be enforced
if:
1. The seller/lessor knows they do not have title to the property.
2. The seller/lessor cannot provide a clear title at the time of completion, even if they believed they had a good
title when entering into the contract.
3.Non-enforcement with Variation (Section 18): If a plaintiff seeks specific performance but the defendant asserts a variation
(due to fraud, mistake, or misrepresentation), the plaintiff cannot obtain specific performance without accepting the variation.
4.Relief Against Parties and Persons Claiming Under Them (Section 19): Specific performance can be enforced against:
1. Either party or a person claiming under them (with exceptions for transferees for value in good faith).
2. Parties in corporate scenarios like amalgamations or promoters acting on behalf of a company.

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1.Substituted Performance (Section 20): If a party breaches a contract, the affected party may seek performance through a third
party or their own agency after giving notice. However, the affected party cannot claim specific performance after obtaining
substituted performance but can seek compensation.
2.Injunctions in Infrastructure Projects (Section 20A): No injunction can be granted in suits involving contracts for
infrastructure projects if it would delay or impede the project’s progress.
3.Compensation in Addition to Specific Performance (Section 21): In a suit for specific performance, the plaintiff may claim
compensation for breach. If the court decides specific performance is not possible, it can award compensation based on
principles from Section 73 of the Indian Contract Act. Compensation cannot be awarded unless claimed in the plaint, but the
court may allow amendments to include it.
4.Relief for Possession or Refund (Section 22): In suits for specific performance of immovable property contracts, the plaintiff
can also ask for possession, partition, or refund of earnest money if their claim is refused. This relief requires a specific request in
the plaint.
5.Liquidation of Damages (Section 23): Even if a contract specifies a sum to be paid in case of breach, the court can enforce
specific performance instead of allowing the payment of damages if it finds the sum was intended as a means to secure
performance, not as an option for default.
6.Bar on Compensation After Dismissal (Section 24): If a suit for specific performance is dismissed, the plaintiff cannot sue
for compensation for the breach. However, they may still seek other types of relief related to the breach.
This summary encapsulates the legal provisions that govern specific performance and related remedies under the Specific Relief
Act, focusing on conditions for enforcement, exceptions, and related compensatory relief.

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DECLARATORY DECREES (SECTION 34 &
35)
Any person entitled to any legal character, or to any right as to any property, may institute a suit against any
person denying, or interested to deny, his title to such character or right, and the court may in its discretion
make therein a declaration that he is so entitled, and the plaintiff need not in such suit ask for any further relief:

CS SOMYA KATARIA (9131993373)

 Transfer of Property Act, 1882 (TPA)
The Transfer of Property Act, 1882 (TPA) governs the transfer of immovable property in India. It excludes transfers by operation of law
(like sale in execution, insolvency, or intestate succession) and testamentary succession (transfers by will). The act mainly deals with inter
vivos transfers, i.e., transfers between living persons.
Sale (Section 54)
•A sale is the transfer of ownership in exchange for a price (paid, promised, or partly paid).
•For a sale to be valid:
• Immovable Property worth ≥ 100 rupees: Requires a registered document.
• Immovable Property worth < 100 rupees: Transfer can be done either by a registered instrument or by delivery of
the property.
•A contract for sale refers to an agreement where the sale will occur on agreed terms but doesn't immediately transfer any interest or charge
on the property.
Mortgage (Chapter IV)
Section 58 defines a mortgage as the transfer of an interest in immovable property to secure a debt or obligation. Key parties include:
•Mortgagor (borrower)
•Mortgagee (lender)
•Mortgage-money (secured debt)
•Mortgage-deed (document effecting the transfer)
Types of Mortgages
1.Simple Mortgage: No delivery of possession, but the mortgagor promises to repay the loan and allows the mortgagee to sell the property if
the debt is not paid.
2.Mortgage by Conditional Sale: The mortgagor sells property on condition that the sale becomes absolute if the debt isn’t repaid or void if
repaid.
3.Usufructuary Mortgage: The mortgagor delivers possession to the mortgagee, who retains possession until the debt is repaid, using rents or
profits from the property to repay the loan. CS SOMYA KATARIA (9131993373)
1.English Mortgage: The mortgagor transfers property to the mortgagee but has the right to reclaim it once the debt is repaid.
2.Mortgage by Deposit of Title-Deeds: Occurs in specified cities (e.g., Calcutta, Madras, Bombay) where a person deposits documents of
title to secure a loan.
3.Anomalous Mortgage: A mortgage that doesn't fit into the above categories.
In sum, the TPA regulates the transfer of immovable property through sale and mortgage, setting out the conditions for valid transfers and
providing various forms of mortgages with different rights and obligations for the parties involved.

Lease:
1. A lease is the transfer of a right to enjoy immovable property for a specified period in exchange for something of
value (money, service, etc.).
2. The lessor is the property owner, and the lessee is the person renting the property.
3. A lease exceeding one year or with yearly rent must be made through a registered instrument, while others can be
oral or registered.
4. A lease involves the transfer of an interest in the property and possession, whereas a licence only grants permission
to use the property without transferring possession or interest.
5. A licence can be revoked at any time, unlike a lease.
Difference between Lease and Licence:
1. A lease creates an interest and possession rights in the property, while a licence simply allows the use of property
without such rights.
2. The real distinction is based on the intention of the parties and not just the terms used.

CS SOMYA KATARIA (9131993373)

Gift:
1. A gift is a voluntary transfer of existing property (moveable or immoveable) without consideration.
2. A gift must be accepted during the donor’s lifetime, and a gift of immoveable property requires a
registered instrument.
3. A gift can be revoked under specific conditions, but not at the mere will of the donor.
4. Onerous gifts involve a transfer of property burdened with an obligation, and the donee must accept or
reject the entire gift.
Actionable Claims:
1. Actionable claims (e.g., debts) can be transferred through a written instrument signed by the transferor
or agent.
2. The transfer is complete upon execution of the instrument, and the transferee can enforce the claim
without the transferor’s involvement.
3. The transferee takes the claim subject to any liabilities and equities of the transferor.
In short, leases, gifts, and actionable claims each have specific rules regarding transfer, conditions, and rights of the parties
involved.

CS SOMYA KATARIA (9131993373)

 REGISTRATION ACT, 1908
COMPULSORY AND OPTIONAL REGISTRATION OF DOCUMENTS

Documents of which registration is compulsory (Section 17)

The following documents shall be registered compulsorily:

(a) instruments of gift of immovable property;
(b) other non-testamentary instruments which purport or operate to create, declare, assign, limit or extinguish, whether in present or in future,
any right, title or interest, whether vested or contingent, of the value of one hundred rupees and upwards, to or in immovable property;
(c) non-testamentary instruments which acknowledge the receipt or payment of any consideration on account of the creation, declaration,
assignment, limitation or extinction of any such right, title or interest; and
(d) leases of immovable property from year to year, or for any term exceeding one year, or reserving a yearly rent;
(e) non-testamentary instruments transferring or assigning any decree or order of a Court or any award when such decree or order or award
purports or operates to create, declare, assign, limit or extinguish, whether in present or in future, any right, title or interest, whether vested or
contingent, of the value of one hundred rupees and upwards, to or in immovable property.

CS SOMYA KATARIA (9131993373)

 Exemptions from section 17
(i) any composition deed; or
(ii) any instrument relating to shares in a joint stock Company, notwithstanding that the assets of such Company consist in whole or in part of
immovable property; or
(iii) any debenture issued by any such Company and not creating, declaring, assigning, limiting or extinguishing any right, title or interest, to or in
immovable property except in so far as it entitles the holder to the security afforded by a registered instrument whereby the Company has mortgaged,
conveyed or otherwise transferred the whole or part of its immovable property or any interest therein to trustees upon trust for the benefit of the holders
of such debentures; or
(iv) any endorsement upon or transfer of any debenture issued by any such Company; or
(v) any document other than the documents specified in sub-section 17(1A) not itself creating declaring, assigning, limiting or extinguishing any right,
title or interest of the value of one hundred rupees and upwards to or in immovable property, but merely creating a right to obtain another document
which will, when executed, create, declare, assign, limit or extinguish any such right, title or interest; or
(vi) any decree or order of a Court except a decree or order expressed to be made on a compromise and comprising immovable property other than that
which is the subject-matter of the suit or proceeding; or
(vii) any grant of immovable property by Government; or
(viii) any instrument of partition made by a Revenue-Officer; or
(ix) any order granting a loan or instrument of collateral security granted under the Land Improvement Act, 1871, or the Land Improvement Loans Act,
1883; or
(x) any order granting a loan under the Agriculturists, Loans Act, 1884, or instrument for securing the repayment of a loan made under that Act; or
(xa) any order made under the Charitable Endowments Act, 1890, vesting any property in a Treasurer of Charitable Endowments or divesting any such
Treasurer of any property; or
(xi) any endorsement on a mortgage-deed acknowledging the payment of the whole or any part of the mortgage-money, and any other receipt for
payment of money due under a mortgage when the receipt does not purport to extinguish the mortgage; or

CS SOMYA KATARIA (9131993373)

 Documents of which registration is optional (Section 18)

(a) Instruments (other than instruments of gift and wills) which purport or operate to create, declare, assign, limit or extinguish, whether in
present or in future, any right, title or interest, whether vested or contingent, of a value less than one hundred rupees, to or in immovable
property;
(b) instruments acknowledging the receipt or payment of any consideration on account of the creation, declaration, assignment, limitation
or extinction of any such right, title or interest;
(c) leases of immovable property for any term not exceeding one year, and leases exempted under section 17;
(cc) instruments transferring or assigning any decree or order of a Court or any award when such decree or order or award purports or
operates to create, declare, assign, limit or extinguish, whether in present or in future, any right, title or interest, whether vested or
contingent, of a value less than one hundred rupees, to or in immovable property;
(d) instruments (other than wills) which purport or operate to create, declare, assign, limit or extinguish any right, title or interest
to or in movable property;
(e) wills; and
(f) all other documents not required by section 17 to be registered.

CS SOMYA KATARIA (9131993373)

 TIME OF REGISTRATION

1. A document other than a will shall be presented to the proper officer within four months from the date of its execution.
2. a copy a of a decree or order may be presented within four months from the day on which the decree or order was made, or,
where it is appealable, within four months from the day on which it becomes final.
3. If a document requiring registration has been accepted for registration by a Registrar or Sub-Registrar from an unauthorized
person, and has been registered, any person claiming under such document may, within three months from his first becoming
aware that the registration of such document is invalid, present such document for re- registration in the office of the
Registrar of the district in which the document was originally registered;
4. In case of delay in registration happens which does not exceed four months (4 + 4), then, on payment of a fine not
exceeding ten times the amount of the proper registration-fee, such document shall be accepted for registration. A WILL
may at any time be presented for registration or deposited.

CS SOMYA KATARIA (9131993373)

 PLACE OF REGISTRATION

According to section 28
document affects immovable property, and section 18, clauses (a), (b) (c) and (cc), shall be presented for registration in the office of a
Sub- Registrar within whose sub-district the whole or some portion of the property to which such document relates is situate. A copy
of a decree or order may be presented for registration in the office of the Sub-Registrar in whose sub-district the original decree
or order was made, or, where the decree or order does not affect immovable property, in the office of any other Sub-Registrar under the
State Government at which all the persons claiming under the decree or order desire the copy to be registered.

EFFECTS OF REGISTRATION AND NON-REGISTRATION OF

DOCUMENTS
No document required by section 17 or by any provision of the Transfer of Property Act, 1882, to be registered shall:

(a) affect any immovable property comprised therein, or

(b) confer any power to adopt, or

(c)be received as evidence of any transaction affecting such property or conferring such power, unless it has been registered.

CS SOMYA KATARIA (9131993373)

INDIAN STAMP ACT, 1899

INSTRUMENTS CHARGEABLE WITH DUTY (SECTION 3)

(a) instrument mentioned in that Schedule which, not having been previously executed by any person, is executed in India on or after
the first day of July, 1899;

(b) every
bill of exchange payable otherwise than on demand or promissory note drawn or made out of India on or after that day and
accepted or paid, or presented for acceptance or payment, or endorsed, transferred or otherwise negotiated, in India; and
(c) every
instrument (other than a bill of exchange, or promissory note) mentioned in that Schedule, which, not having been previously
executed by any person, is executed out of India on or after that day, relates to any property situate, or to any matter or thing done or
to be done, in India and is received in India:

CS SOMYA KATARIA (9131993373)

 Instruments coming within several descriptions in Schedule I
(Section 6)

Subject to the provisions of the last preceding section, an instrument so framedas to come within two or more of the descriptions in
Schedule I, shall, where the duties chargeable thereunder are different, be chargeable only with the highest of such duties. However,
nothing in Indian Stamp Act contained can render chargeable with duty exceeding one rupee a counterpart or duplicate of any
instrument chargeable with duty and in respect of which the proper duty has been paid.

ADJUDICATION OF STAMP DUTY

Adjudication as to proper stamp.(Section 31)

(1) When any instrument, whether executed or not and whether previously stamped or not, is brought to the Collector, and the person
bringing it applies to have the opinion of that officer as to the duty (if any) with which it is chargeable, and pays a fee of such
amount (not exceeding five rupees and not less than fifty naye paise) as the Collector may in each case direct, the Collector shall
determine the duty (if any) with which, in his judgment, the instrument is chargeable.

(2) For this purpose the Collector may require to be furnished with an abstract of the instrument, and also with such affidavit or other
evidence as he may deem necessary to prove that all the facts and circumstances affecting the chargeability of the instrument with duty,
or the amount of the duty with which it is chargeable, are fully and truly set forth therein, and may refuse to proceed upon any such
application until such abstract and evidence have been furnished accordingly:

CS SOMYA KATARIA (9131993373)

Instruments not duly stamped inadmissible in evidence, etc. (Section 35)

No instrument chargeable with duty shall be admitted in evidence for any purpose by any person having by law
or consent of parties authority to receive evidence, or shall be acted upon, registered or authenticated by any
such person or by any public officer, unless such instrument is duly stamped.

Admission of instrument where not to be questioned (Section 36)

Where an instrument has been admitted in evidence, such admission shall not, except as provided in section
61, be called in question at any stage of the same suit or proceeding on the ground that the instrument has not
been duly stamped.

How transfer in consideration of debt, or subject to future payment, etc., to be charged(Section 24)

Where any property is transferred to any person in consideration, wholly or in part, of any debt due to him,
or subject either certainly or contingently to the payment or transfer of any money or stock, whether being or
constituting a charge or incumbrance upon the property or not, such debt, money or stock is to be deemed the
whole or part, as the case may be, of the consideration in respect whereof the transfer is chargeable with ad
valorem duty.

CS SOMYA KATARIA (9131993373)

Section 61 regarding the revision of decisions related to the sufficiency of stamps:
1.Court’s Power to Reconsider Orders on Stamps (Section 61(1)): When a Court (civil, revenue, or criminal)
admits an instrument as duly stamped or not requiring a stamp (or with a penalty under Section 35), the appellate
court or court to which references are made may, on its own or on the Collector's application, review the decision.
2.Action on Revision (Section 61(2)): If the revising court determines that the instrument should not have been
admitted without the correct stamp duty and penalty, or a higher duty and penalty, it can:
•Declare that the instrument was improperly admitted.
•Determine the correct stamp duty payable.
•Order the person possessing the instrument to produce it, and if necessary, impound it.
3.Notification to the Collector (Section 61(3)): After the court's declaration, it must send a copy to the Collector
and any impounded instrument to the Collector for further action.
4.Collector’s Authority to Prosecute (Section 61(4)): The Collector may prosecute anyone who violated the
stamp laws, despite the court's prior order admitting the instrument in evidence. However:
•No prosecution is allowed if the correct duty and penalty have been paid unless the Collector believes the
offense was intentional to evade payment.
•The declaration made by the court does not affect the validity of the earlier decision admitting the instrument
or certificates issued under Sections 42 and 43, except for prosecution purposes.
In essence, this section allows higher courts to revise decisions made by lower courts about the sufficiency of
stamps on documents and empowers the Collector to take action if necessary.

CS SOMYA KATARIA (9131993373)

 Payment of Stamp Duty

The following instruments can be stamped with adhesive stamps:

(a) instruments chargeable with a duty not exceeding ten naye paise, except parts of bills of
exchange payable otherwise than on demand and drawn in sets;

(b) bills of exchange, and promissory notes drawn or made out of India;
(c) entry as an advocate, vakil or attorney on the roll of a High Court;
(d) notarial acts; and
(e)transfers by endorsement of shares in any incorporated company or other body corporate.

CS SOMYA KATARIA (9131993373)

 THE POWERS-OF-ATTORNEY ACT, 1882
Procedure for Deposit of original instruments creating Powers-of-
Attorney provided under section 4
The procedure for Deposit of original Powers-of-Attorney is provided under Section 4 of the Powers-of-
Attorney Act, 1882. It provides that:

(a) An instrument creating a power-of-attorney, its execution being verified by affidavit, statutory
declaration or other sufficient evidence, may, with the affidavit or declaration, if any, be deposited in the
High Court or District Court within the local limits of whose jurisdiction the instrument may be.
(b) A separate file of instruments so deposited shall be kept; and any person may search that file, and inspect
every instrument so deposited; and a certified copy thereof shall be delivered out to him on request.
(c) A copy of an instrument so deposited may be presented at the office and may be stamped or marked
as a certified copy, and, when so stamped or marked, shall become and be a certified copy.
(d) A certified copy of an instrument so deposited shall, without further proof, be sufficient evidence of the
contents of the instrument and of the deposit thereof in the High Court or District Court.

According to Section 5 of the Powers-of-Attorney Act, a married woman of full age has the same power as
an unmarried woman to appoint an attorney. She can do this through a non-testamentary instrument to act on
her behalf in executing non-testamentary instruments or performing any other acts she could do herself.

CS SOMYA KATARIA (9131993373)

 Agar shuru karne ki himmat thi toh...

Khatam karne se kyu Ghabra rahe ho?

CS SOMYA KATARIA (9131993373)

 UNIT 4:
DRAFTING
DRAFTING AND
C O N V E YA N C I N G O F D E E D S
A N D D O C U M E N T S - PA RT I
IMPORTANT TERMS
• What is Agreement?
• An agreement is defined u/s 2 (e) as ‘ every promise and every set of promises, forming
consideration for each other.
• What is Contract?
• An agreement is enforceable u/s 10 if it is made by competent parties,out of their free consent and
for lawful object and consideration.Therefore, a Contract = Agreement + Enforceability.Thus all
contracts are agreements but all agreements are not necessarily contracts.
• What is deed?
• A deed is a writing – (a) on paper, vallum or parchment,(b) sealed,and (c) delivered,whereby an
interest,right or property passes,or an obligation binding on some persons is created or which is in
affirmance of some act whereby an interest, right or property has been passed A deed is a present
grant rather than a mere promise to be performed in the future.Deeds are in writing,signed,sealed
and delivered.
The word "document" is defined in a broad sense across various Indian laws. Three
key acts provide similar definitions:
1.Indian Evidence Act, 1872 (Section 3): A "document" includes any matter
expressed or described by letters, figures, or marks on any substance, intended or
capable of being used to record that matter. This covers writings, printed materials,
maps, plans, inscriptions on metals or stones, and even caricatures.
2.General Clauses Act, 1897 (Section 3(18)): Defines "document" similarly,
including any written or expressed matter on a substance through letters, figures, or
marks, meant for recording information.
3.Indian Penal Code, 1860 (Section 29): States that "document" refers to any
matter expressed or described on a substance by letters, figures, or marks, intended
or used as evidence of that matter.
In conclusion, the term "document" is used in a wide context to include written
records, instruments, deeds, agreements, and even electronic records
IMPORTANT POINTS RELATED TO
DRAFTING
1. Description of parties 11. Passing of the Property and Passing of the Risks
• 2. Legal Nature of the Contract 12. Amount, Mode and Currency of Payment
• 3.Licences and Permits 13. Force Majeure
• 4.Taxes,Duties and Charges 14. Proper Law of Contract
• 5. Quality,Quantity and Inspection of Goods 15.Settlement of Disputes andArbitration
• 6.Packing
• 7.Shipment of the Goods
• 8.Insurance
• 9.Documentation
• 10.Guarantee
DEEDS OF POWER OF ATTORNEY i.e. GENERAL POWER
OF ATTORNEY AND SPECIAL POWER OF ATTORNEY
A Power of Attorney (PoA) is a legal document that grants a person or group the
authority to act on behalf of another person (the donor). It falls under the general
law of agency, governed by the Indian Contract Act, 1872, and the Powers of
Attorney Act, 1882.

A General Power of Attorney allows the agent to act on the donor's behalf in
multiple transactions or actions, but the term "general" refers to the broad nature of
the powers granted in relation to the subject matter.
 LEASE

• Sub-Lease
• A sub-lease is a demise by a lessee (or his assignee) for a less term than he himself has. Every
lessee, however short his term may be, make a sub-lease unless he is refrained by the contract of
the tenancy from subletting. If the demise is for the whole term or for a period beyond the term, it
amounts to assignment. . A sub-lessee is entitled to relief against forfeiture under Section 114 of the
Transfer of Property Act, 1882, which is applicable only in the case of non-payment of rent. No relief
is open to the sublease in case of transfer of breach of covenant in restraint of transfer.

• Surrender:
• A surrender must be made with clear intention to yield up as mere non-payment of rent for years
together or abandonment of the site does not amount to surrender
 LICENSE
• TRANSFERABILITY:

• A license cannot be transferred by the licensee or exercised by his servants or agents. The only
exception to this rule is that, unless a different intention is expressed or necessarily implied, a license
to attend a place of public entertainment may be transferred by the licensee.

• Registration and stamp duty:

• Chargeable
• If a license is contained in any deed such as in a deed of sale or lease, no separate stamp duty is
required
 GIFT
• Section 122 of the Transfer of Property Act, 1882 states that ‘Gift’ is the transfer of certain existing movable
or immovable property made voluntarily and without consideration, by one person, called the donor, to
another, called the donee, and accepted by or on behalf of the donee
• Gift should be made only for the existing property as gift of future property is void under Section 124 of the
TOPA.

• Section 125 provides that the gift of a thing to two or more donees of whom one does not accept it, is void as
to the interest which he would have taken had he accepted.
• As per Section 126, the donor and donee may agree that on the happening of any specified event which does
not depend on the will of the donor a gift shall be suspended or revoked, but a gift which the parties agree
shall be revocable wholly or in part at the mere will of the donor is void, wholly or in part as the case may
be.

• Under Hindu Law a gift once completed is binding upon the donor and it cannot be revoked by him unless it
was obtained by fraud or undue influence
 SALE AGREEMENT
• Contracting parties (Kon Kon h?)
• Consideration (Paisa, Money, Rokda)
• Subject matter (Kya bech rahe ho?)
• Time for performance (Kab tak karna hai?)
• Broker (Middleman)
• Encumberances (Koi gadbad to nahi hai?)
• Mode of payment (Cash ya cheque?)
• Inspection of title deeds/subject matter (Sab check karke hi execution hoga:3 points)
• Arbitration (Jhagde)
1. Mediation Agreement (Module)

2. Cociliation Agreement (Module)

3. Show cause notice (Module)

4. Notice under negotiable instruments (Module)

 Employment Contract
An employment contract is a formal agreement between an employer and employee that
outlines the employee's job responsibilities, duties, and expectations. It defines the
relationship between the two parties and ensures clear communication regarding roles
within the organization. A well-drafted employment contract helps prevent
misunderstandings and promotes fairness.
Key contents of an employment agreement typically include:
1.Name of the parties involved (Employer and Employee)
2.Starting date of employment
3.Title and description of the job
4.Location of work
5.Hours of work
6.Probationary period
7.Salary
8.Restrictive terms (such as non-compete clauses)
9.Holidays
10.Other information (including deductions, permissible expenses, and notice period)
Employers should also provide the employee with relevant company policies referenced in
the contract.
DRAFTING OF BYE-LAWS OF SOCIETIES
A Society is an association of individuals who come together for a common purpose,
such as charitable work, and is governed by the Societies Registration Act, 1860.
Registration under the Societies Registration Act 1860 is required to receive legal and
tax benefits, and unregistered societies cannot claim benefits under the Income Tax
Act.

DRAFTING OF STANDING ORDERS

The Standing Orders Act requires employers of industrial establishments with 100 or
more workers (or 50 or more in N.C.T. of Delhi) to define conditions of employment
through standing orders or service rules. These must be communicated to the
workers. Employers must prepare a draft of these orders and submit them to
Certifying Officers for certification. Once certified, standing orders have the force of
law.
Administrative Machinery:
•Deputy Labour Commissioners serve as Certifying Officers.
•Industrial Tribunal-I acts as the appellate authority.
Penalties:
•Failure to submit draft standing orders can lead to a fine of up to Rs. 5,000.
•Violating standing orders can result in a fine of up to Rs. 100, with additional fines
of up to Rs. 25 per day for continued offenses.
REPLY OF SHOW CAUSE
NOTICES
A Reply to a Show Cause Notice is a serious matter, as it provides an opportunity
to avoid criminal charges or liabilities. The following points should be kept in mind
when replying:
1.Provide a proper explanation at the earliest.
2.Keep the reply brief and to the point.
3.Ensure that the tone reflects an understanding of the seriousness of the situation.
In your reply:
•Offer reasonable excuses that any layperson could understand.
•Maintain a humble tone and express regret, if necessary.
•Always file the reply within the specified time mentioned in the notice.
In the case of Meenakshi v. State of Haryana, the Court clarified that a petitioner's
reply to a show-cause notice did not lead to miscarriage of justice. The petitioner
was allowed to present her reply, and the court dismissed the case since the
request for forgiveness was not accepted.
Agar shuru karne ki himmat thi toh...

Khatam karne se kyu Ghabre rahe ho?

STUDY HARD
 UNIT5:DRAFTING OF
COMMERCIAL
CONTRACTS

CS Somya Kataria (8461967667)

Important Clauses of Commercial
Contracts

◦ Confidentiality clause to prevent unauthorized disclosure of confidential information.

◦ Dispute resolution clause stating how disputes arising from the transaction will be handled. Details
on the court that will have jurisdiction over matters arising from the transaction and the governing
law, especially for domestic and international cross-border transactions. Termina on clause detailing
how any party can opt-out of the arrangement and conditions that will end the contract. Indemnity
clause to protect parties from liabilities caused by a breach of contract or negligent acts of third par
es. Liquidated damages clause to specify damages upon breach of contract. Force majeure clause to
remove liability for failure to perform contractual obligation caused by unforeseen and unavoidable
circumstances.

CS Somya Kataria (9131993373

 7.ASSIGNMENT OF PATENTS
• Clause:
NOW IT IS HEREBY CONSENTED AS FOLLOWS:
Agreement to Assign:
That in consideration of a sum of Rs. _ (the patentee hereby acknowledges its receipt) to payable by the
assignee to patentee and a further payment of Rs. , the inventor shall vend to assignee all his
rights/interests with concerning the said patent rights.
Deed of Assignment : The patentee shall be executing an assignment deed and do all things as may be
compulsory in vest owing said patent rights in the assignee.
Patentee’s Agreement : The patentee hereby agrees that, as per assignment of patent rights to the assignee,
he shall correspond all progress made by him in said invention to assignee and shall help assignee for doing all
acts, deeds/things compulsory for procuring a patent for such progress which shall be bestowed in the assignee
on the same term/ conditions as if such progress had formed potion of original invention.

Assignee’s Agreement The assignee hereby agrees that, as per assignment of patent rights to him, he shall not
do anything resulting in cancellation of said patent rights and shall, in the eventuality of such revocation, pay
to patentee as liquidated compensation, the sum of Rs. , respectively
LIMITED LIABILITY PARTNERSHIP
AGREEMENT
A Limited Liability Partnership (LLP) Agreement is a written contract between the partners of an LLP, as
per the Limited Liability Partnership Act, 2008, and is essential for governing the rights and duties of the
partners. It must be executed and filed within 30 days of incorporation. Here’s a summary of the key
elements that should be included in an LLP Agreement:
1.Name of the LLP: Must end with “LLP” or “Limited Liability Partnership” as per the LLP Act.
2.Date of the Agreement and Parties: Specifies the date of execution and the partners involved in the
agreement.
3.Introductory Provisions: Defines the key terms used in the agreement.
4.Place of Business: The registered office of the LLP should be mentioned.
5.Business Activity: Describes the business activities of the LLP as approved during incorporation.
6.Duration: States the duration of the LLP, whether it’s for a specific period or until terminated by mutual
consent.
7.Accounting and Auditing: Details the methods for maintaining accounts and whether an audit is required.
8.Partners’ Contribution and Method of Contribution: Defines the capital contributions, profit-sharing
ratio, and withdrawal terms.

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9.Record Keeping and Bank Arrangements: Specifies how records and documents will be maintained.
10.Allocation and Distribution: Clarifies the profit-sharing mechanism and distribution among partners.
11.Disassociation of Partner: Outlines the terms for a partner withdrawing or leaving the LLP and their
rights to assets.
12.Partners’ Rights to Records: Ensures each partner can access the LLP’s records to prevent
misappropriation.
13.Management and Fiduciary Duty: Defines management responsibilities and protection of confidential
information.
14.Arbitration and General Provisions: In case of disputes, arbitration is used to settle conflicts between
partners.
15.Other Provisions: Includes details on the admission of new partners, their rights, decision-making
processes, voting rights, meetings, and potential partner redemption.
This agreement ensures smooth operation, clarifies decision-making procedures, and provides a framework
for handling disputes and changes in partnership.

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JOINT VENTURE

A joint venture (JV) is a strategic collaboration between two or more businesses to pool resources and work
together on a specific project or ongoing basis. Each participant shares in the profits, losses, and costs, while
the JV itself remains a separate entity. It's important to clearly define roles and responsibilities early on to
achieve the venture's goals. Joint ventures can vary in structure, including:
1.Contractual JV – Collaboration on a specific project or ongoing knowledge sharing without forming a
separate company.
2.Partnership – A de facto partnership formed when businesses work together for profit, even without formal
recognition.
3.Limited Liability Company (LLC) – A separate company set up for high-cost projects, where both parties
invest capital.
Before forming a JV, it's essential to clarify whether it will be short or long-term, whether a new entity should
be created, or if the collaboration may evolve into a merger or acquisition.

CS Somya Kataria (9131993373

FOREIGN COLLABORATION
AGREEMENTS

Foreign collaboration agreements refer to arrangements between a party in India and a foreign entity for the
exchange of technical know-how, designs, training, and the provision of services. These agreements are
aimed at enhancing collaboration in areas such as agriculture, mining, oil exploration, and power generation.
Indian entrepreneurs seek such collaborations to obtain advanced technical expertise from developed
countries, helping to drive the country’s development.
The Indian government has issued specific guidelines for the submission of proposals for foreign
collaboration, ensuring they are processed efficiently and uniformly. These agreements are vital for
facilitating technological growth and industrial development in India.

CS Somya Kataria (9131993373

3. FOREIGN COLLABORATION
AGREEMENT
• 1.Investment
• 2. Lumpsum payment:(i) one-third to be paid after the agreement has beer approved by the
Central Government;
(ii) one-third on transfer of the technical documents;
(iii) one-third on the commencement of commercial production
3. Royalty
4. Duration
5. Renewal
6. Remittances
7. Sub-licensing
8. Brand name 9.Applicable law 10.Approval of CG 11.Arbitration
 Joint Development Rights
Agreement (JDA)

A Joint Development Rights Agreement (JDA) is a collaborative arrangement where a landowner and a
developer combine resources for a real estate project. The landowner provides land, while the developer
takes on the responsibility of development, approvals, marketing, and sales. In exchange, the developer
may offer a lump sum payment, a percentage of sales revenue, or a share of the newly developed
property, depending on the agreed terms. This setup allows the developer to avoid initial land acquisition
costs and use their expertise efficiently, while the landowner receives a better price for their land
compared to a direct sale. The agreement is beneficial for both parties and creates a win-win situation
with minimal financial investment. While commonly used in real estate, JDA arrangements can also apply
to the development of new products or technologies, with a focus on research, development, and
Intellectual Property Rights. This type of agreement is also known as a strategic alliance agreement.

CS Somya Kataria (9131993373

4. JOINT VENTURE AGREEMENT
• 6 clauses of MOA
• Incorporation expenses
• Who will bring the business?
• Mode of Allotment
• Duties of both the parties
• Appointment of director
• Appointment of auditor
• Sell off shares
• Arbitration
 SERVICE AGREEMENTS
A Service Agreement outlines the terms and conditions of employment, and should be clear, explicit, and easily
understandable to both parties. Key clauses typically include:
1.Period of Service: The employment term can be definite or indefinite, with provisions for termination through
reasonable notice (ranging from 15 days to six months).
2.Remuneration: Details the salary, commissions, bonuses, or any other perquisites such as allowances or rent-free
housing.
3.Leave: Specifies the conditions for leave, duration, and allowances during leave.
4.Determination of Employment: Lists the grounds for termination, such as misconduct or negligence, and includes
provisions for notice or immediate dismissal in cases of misconduct.
5.Restrictive Covenants: Includes clauses to protect the employer’s interests, such as confidentiality and non-compete
agreements, but must comply with the law (e.g., agreements in restraint of trade are void).
6.Compliance with Labour Laws: The agreement must align with relevant labor laws, like the Factories Act or Payment
of Wages Act, as any term contradicting statutory provisions will be void.
Service agreements aim to clearly define the rights and duties of both the employer and employee to avoid
misunderstandings and legal disputes.
Dealership & Distributorship AGREEMENTS

Dealership Agreement: A legal document between a vendor and a dealer that defines the business
relationship. Key elements include the purpose of the agreement, tenure, obligations of both parties, supply and
return procedures, promotion and training, invoicing and payment methods, restrictions, and termination
clauses. The agreement may be more complex with larger manufacturers, including requirements for facilities,
personnel, and sales reporting.

Distributorship Agreement: A contract between a supplier and distributor where the distributor buys and sells
items to retailers or consumers. The agreement covers terms like supply conditions, sales territories,
remuneration, insurance, transportation, and risk. It may be exclusive (sole distributor) or non-exclusive (multiple
distributors). Important considerations include the duration, marketing rights, geographical coverage,
performance expectations, reporting, and termination conditions.
Both agreements are essential for establishing clear rights, duties, and business operations between the
involved parties.
Franchise Agreement

A Franchise Agreement is a legally binding contract between a franchisor and a

franchisee, allowing the franchisee to open a franchise location and use the
franchisor’s branding, business methods, and supplier resources. The agreement
outlines the conditions of the relationship, including the franchisee's limitations,
financial commitments, and operational guidelines. Franchise agreements typically
offer more protection to the franchisor than to the franchisee and are designed to
maintain the integrity of the brand, operating system, and the behavior of
franchisees. The primary aim is to safeguard the franchise system as a whole.
Outsourcing Agreement
Outsourcing agreements involve contracting out a company's activities to specialists, focusing on core competencies. There are
different types of outsourcing, including Information Technology (IT), Business Process Outsourcing (BPO), and Knowledge
Process Outsourcing (KPO). A strong outsourcing agreement outlines the roles, responsibilities, and obligations of both
parties—outsourcer and service provider—helping to prevent disputes. To ensure clarity and avoid misunderstandings, all
terms should be carefully discussed and negotiated. Consulting a professional before finalizing the agreement is
recommended. Key factors to address before signing include:
1.Duties and obligations of both parties
2.Security and confidentiality
3.Legal compliance
4.Fees and payment terms
5.Proprietary rights
6.Auditing rights
7.Applicable law
8.Agreement term
9.Events of defaults
10.Dispute resolution mechanism
11.Arbitration location and details
12.Interim remedies
13.Privacy agreement
These elements help create a comprehensive and effective outsourcing agreement.
Non-Disclosure Agreement

A Non-Disclosure Agreement (NDA), also known as a Confidentiality Agreement, is a legally binding contract where
parties agree to keep sensitive information confidential. NDAs are commonly used when companies discuss potential
business ventures to protect their interests. Key elements of an NDA include:
1.Identification of the parties involved.
2.Definition of what is considered confidential.
3.Scope of confidentiality obligations for the receiving party.
4.Exclusions from confidentiality (e.g., information that is public or independently discovered).
5.Term of the agreement (duration of confidentiality).
The NDA ensures that sensitive information remains protected during discussions or collaborations.
Electronic Contracts (E-Contracts)
Electronic Contracts (E-Contracts) are contracts formed in the digital environment, typically through e-commerce
transactions, where two or more parties use electronic means such as email or computer programs to create and accept a
contract. Unlike traditional paper-based contracts, e-contracts are designed for speed, convenience, and efficiency, allowing
quick completion through digital signatures.
While initially there was hesitancy to recognize e-contracts, many countries, including India, have enacted laws to regulate
them. In India, the Information Technology Act, 2000 governs e-contracts, addressing issues such as secure electronic
records, digital signatures, and the attribution and acknowledgment of electronic communications. E-contracts in India are
treated as general contracts under the Indian Contract Act, 1872, and are subject to the same principles of formation,
execution, and breach.
The Indian Evidence Act, 1872 also deals with the admissibility of electronic records as evidence in legal disputes. The IT Act
resolves specific issues related to the formation and authentication of electronic contracts, ensuring they are legally recognized
and enforceable.

TYPES OF E-CONTRACTS
Generally the basic forms of e-contracts are:
The Click-wrap or Web-wrap Agreements.
The Shrink-wrap Agreements.
The Electronic Data Interchange or (EDI).
Online Shopping Agreements.
GIFT
◦ 1. Section 122 of the Transfer of Property Act, 1882 states that ‘Gift’ is the transfer of certain existing
movable or immovable property made voluntarily and without consideration, by one person, called the
donor, to another, called the donee, and accepted by or on behalf of the donee.
◦ 2. Gift should be made only for the existing property as gift of future property is void under Section 124 of
the TOPA.

◦ 3. Section 125 provides that the gift of a thing to two or more donees of whom one does not accept it, is
void as to the interest which he would have taken had he accepted.
◦ As per Section 126, the donor and donee may agree that on the happening of any specified event
which does not depend on the will of the donor a gift shall be suspended or revoked, but a gift which
the parties agree shall be revocable wholly or in part at the mere will of the donor is void, wholly or in
part as the case may be.
◦ Under Hindu Law a gift once completed is binding upon the donor and it cannot be revoked by him
unless it was obtained by fraud or undue influence

CS Somya Kataria (9131993373

 . Power of attorney
◦ 1. a power of attorney includes an instrument empowering a specified person to act for and in the name of
the person executing it. It is always kept by the attorney

◦ 2. Who can become an attorney?

◦ Ans: A power of attorney can be executed by any person, who can enter into a contract, i.e., a person of
sound mind who has attained majority
◦ 3. Section 2 of the Powers-of-Attorney Act, 1882 provides that the signature of the agent will be deemed to
be the signature of the principal.
◦ Section 5 of the Powers-of-Attorney Act, 1882, relating to married women’s power to execute a power of
attorney provides that a married woman of full age shall, by virtue of this Act, have power, as if she were
unmarried.
◦ The powers conferred on the attorney should be specifically stated after the appointment, preferably, in
separate paragraphs.
◦ VERY IMP: Sometimes, after giving specific powers, a general clause empowering the attorney to do all such
lawful acts as the attorney should think reasonable is added, but this is not ordinarily necessary, as
according to authorities such a clause does not extend or widen the authority

CS Somya Kataria (9131993373

 5. FAMILY SETTLEMENT DEED
◦ (1) The family settlement must be a bona fide one so as to resolve family disputes and rival claims by a fair
and equitable division or allotment of properties between the various members of the family.

◦ (2) The said settlement must be voluntary and should not be induced by fraud, coercion or undue influence.
◦ (3) The family arrangement may be even oral in which case no registration is necessary.
◦ (4) It is well-settled that registration would be necessary only if the terms of the family arrangement are
reduced into writing.
◦ (5) The members who may be parties to the family arrangement must have some antecedent title, claim or
interest or even a possible claim in the property which is acknwoledged by the parties to the settlement. Even
if one of the parties of the settlement has no title but, under the arrangement, the other party relinquishes all its
claims or titles in favour of such a person and acknowledges him to be the sole owner, then the antecedent
title must be assumed and the family arrangement will be upheld and the Courts will find no difficulty in giving
assent to the same.
◦ (6) Even in bona fide disputes, present or possible, which may not involve legal claims are settled by a bona
fide family arrangement which is fair and equitable, the family arrangement is final and bindng on the parties
to the settlement.
CS Somya Kataria (9131993373
TYPESOFE-CONTRACTS
Click wrap or 1. I accept + i. Type and Click where the user must type “I accept” or other specified words
shrink wrap Submit Take-it-or- in an on-screen box and then click a “Submit” or similar button. This displays
agreement leave-it. acceptance of the terms of the contract. A user cannot proceed to download or
2. OK/ I agree view the target information without following these steps.
ii. Icon Clicking where the user must click on an “OK” or “I agree” button on a
dialog box or pop-up window. A user indicates rejection by clicking “Cancel” or
closing the window. Upon rejection, the user can no longer use or purchase the
product or service. A click wrap contract is a “take-it-or-leave-it” type of
contract that lacks bargaining power.
Shrink wrap Agreements Shrink wrap contracts are license agreements or other terms and conditions
agreement which can only be which can only be read and accepted by the consumer after opening the
read and product like CD ROM of software. The terms and conditions are printed on the
accepted after cover of CD ROM. Sometimes additional terms are imposed when in such
opening the CD licenses appear on the screen when the CD is downloaded to the computer.
ROM The user has right to return if the new terms and conditions are not to his liking

CS Somya Kataria (9131993373

 TYPESOFE-CONTRACTS
EDI Transfer of data These contracts, used in trade transactions which enable the transfer of data
from one from one computer to another in such a way that each transaction in the
computer to trading cycle (for example, commencing from the receipt of an order from an
another overseas buyer, through the preparation and lodgment of export and other
official documents, leading eventually to the shipment of the goods), can be
processed with virtually no paperwork. Here unlike the other two, there is
exchange of information and completion of contracts between two computers
and not an individual and a computer.

CS Somya Kataria (9131993373

1. dealership v/s distributorship (module)
ARBITRATION AGREEMENT
• Pre-requisites of arbitration:Every arbitration must havethe following three pre-requisites:
• (i) a dispute betweenpartiesto an agreement,requiring a settlement;
• (ii) its submission for a settlement to a third person;and
• (iii) a decisionby such third person according to his own judgement based onthe facts and circumstances of the
dispute,which is binding on boththe parties.
• The general requisites of an award are:
• (a) it must be consistent with the submission;
• (b) it must be certain;
• (c) it must be fair to the parties;
• (d) it must be final;
• (e) its implementation must be possible
• Points:1.Nameofthearbitrator2.Umpire 3.Timelimit4.Evidences 5.Deathofarbitrator
• 6.awardshall beBinding
 TYPES OF GUARANTEE

A guarantee, guaranteeing an
employer against the A guarantee given by the principal A guarantee which ensures the A “bank guarantee” is a guarantee given by a bank
misconduct of an employee debtor to the surety providing him contracted performance of another on behalf of its client or account-holder to another
or to answer for the debt or continuing indemnity against any person and under which the surety person with whom the client has entered into a
default of another,is called a loss or damage that the surety may undertakes to compensate the contract to perform some job or to do and call
“fidelity guarantee”. suffer on account of default on the person in whose favour the upon the bank to pay the guaranteed amount in the
part of the principaldebtor, is called guarantee is given,in the event of event of the contingency, mentioned in the
“counterguarantee failure on the part of the person on guarantee, happening or not happening, as the case
whose behalf the guaranteeis given, may be.
is known as “performance
guarantee”.
Agar shuru karne ki himmat thi toh...

Khatam karne se kyu Ghabre rahe ho?

 UNIT 6:
DRAFTING
Drafting Under Compamies Act, 2013
TRANSFER OF UNDERTAKINGS: AMALGAMATION
Amalgamation refers to the merging of two corporations, resulting in the creation of a new
company that inherits the assets and liabilities of both original companies. This process aims to
form a larger and more efficient entity. Amalgamation can occur in two ways:
1.By transferring multiple undertakings to a new company.
2.By transferring one or more undertakings to an existing company.
Case Law: In the case of Speed Line Agencies vs. T Stanes & Co. Ltd, the Supreme Court
ruled that when a transferor company is dissolved due to amalgamation, any legal proceedings
it was involved in continue in the transferee company's name as if the scheme had never been
made. This means that the transferee company inherits all rights, including legal actions like
eviction orders.
Reorganization under the Companies Act, 2013: Sections 230-240 of the Companies Act, 2013
provide the framework for company reorganization, including amalgamation, mergers,
takeovers, and reconstructions. These terms have overlapping features but differ in scope. An
"arrangement" is a broad term that includes share capital reorganizations, such as
consolidating or dividing share classes, and encompasses reconstructions and amalgamations.
Although "reconstruction" is not defined in the Act, it typically involves transferring an
undertaking to another company with largely the same shareholders, aimed at continuing the
business under the transferee company.
 TYPES OF
MORTGAGE

English: The Anomalous

Conditional Usufructuary:
Mortgagor mortgagor Mortgage by
Sale: The
Simple: The property is sold delivers binds himself to deposit of title
mortgagor possession of repay the deeds: Oral
subject to the
without the property to money and transaction, where
condition that the mortgagee to no written
delivering transfers then acknowledgement
possession, on default in who retains the property is required.
binds himself to repayment on a possession until absolutely
personally pay certain date, repayment. The which shall be
the mortgaged the sale shall mortgagee will re-transferred
money. become usufruct in lieu on repayment
absolute or else of interest and
it shall be void principle
Points to include in a mortgage deed
◦ 1.Parties
◦ 2. Recitals:“Whereas the borrower is the absoluteowner of the property hereby mortgaged free from encumbrances”. The
second form of recital is as to the agreement for loan, such as: “And Whereas the mortgagee has agreed with the borrower
to lend him the sum of Rs................................................upon having the re-payment thereof with interest hereinafter mentioned
secured in manner hereinafter appearing”.
◦ 3. Covenant for re-payment
◦ 4. MORTGAGE CLAUSE
◦ 5. (I) Covenants by the mortgagor: To repair the mortgaged property, in defaultthe mortgagee is givenpower to enter into
possession without being liable as a mortgagee in possession, with a view to effect repairs. Mortgagee’s expenses for this
purpose are considered properly incurred.
◦ (ii) Covenant to insure: The mortgagor covenants to insurethe mortgage property in the name of the mortgagee of an
insurance office approved by the mortgagee. In default, the mortgagee is entitled to insure and the costs incurred are to be
charged to the mortgagor.
◦ (iii) Covenant not to grant leases or accept surrender thereof: It often happens that the mortgagor whilein possession, grants
long term leases to the detriment of the mortgagee. To guard againstsuch a contingency, it is agreed that the mortgagor shall
not grant leases of mortgaged property for a period exceeding one year without the written permission of the mortgagee or
accept surrender of existing leases without likepermission. (See Section 65A of the Transfer of Property Act)
◦ (iv) Covenant to pay outgoings: The borrower undertakes to pay and discharge and indemnify the mortgagee against all
rates, taxes, duties, charges, assessments, outgoings, whatever.
◦ 6. Period
◦ 7. Power of sale
◦ 8. Power to appoint receiver
◦ 9. Possession Jayega ya nahi? (Depending on the mortgage)
◦ 10. Attestation, stamp duty, Reg.: Compulsory
◦ The powers and functions of the Receiver
◦ (i) in discharge of all rents, taxes, land revenue, rates and outgoings whatever affecting the mortgaged
property;
◦ (ii) in keeping down all annual sums or other payments, and the interest on all principals sums, having priority
to the mortgage in right whereof he is Receiver;
◦ (iii) in payment of his commission, and of the premiums on fire, life or other insurances, if any, properly
payable under the mortgage deed or under this Act, and the cost of executing necessary or proper repairs
directed in writing by the mortgagee;
◦ (iv) in payment of the interest falling due under the mortgage; (v) in or towards discharge of the principal
money, if so directed in writing by the mortgagee.
1. Debenture Trust Deed
A debenture is a debt instrument issued by a company, acknowledging its obligation to
repay a specific sum at a set interest rate. It is a method for raising loan capital, but it
does not become part of the share capital of the company.
A debenture trustee is a person or entity appointed to oversee the interests of the
debenture-holders. They protect the rights of the debenture holders and resolve their
grievances according to the prescribed rules. The company must appoint a debenture
trustee before issuing a prospectus or letter of offer and execute a debenture trust
deed to safeguard these interests.
A debenture trust deed is a legally binding document that creates a trust to secure the
debenture issue. It typically includes the names of the trustees, the beneficiaries
(debenture holders), the nature of the trust property, and the powers and duties of the
trustees. This document must be executed within three months of the closure of the
debenture issue and is open for inspection by the members or debenture holders.
Additionally, a copy of the trust deed must be provided to any member or debenture
holder upon request within seven days, subject to a fee.
Share Purchase Agreement
A Share Purchase Agreement (SPA) is a legal contract between a seller and a buyer regarding the sale of
shares in a company. It specifies the number of shares, the price, and the terms of the sale. This
agreement is often used in mergers and acquisitions, where the buyer may take over a significant portion
(50% or more) of the company’s shares, and thus its assets and liabilities.
Before drafting an SPA, the parties typically negotiate a term sheet to outline key terms, which makes
the drafting process smoother. The SPA covers specific rights, liabilities, and warranties, ensuring that the
interests of both parties are legally protected. In the event of a breach, the SPA serves as the primary
reference for resolving issues.
Key Advantages:
1.Specified Shares: Clearly allocates the proportion of shares to be sold.
2.Defined Rights and Liabilities: Specifies the rights and obligations of both parties.
3.Warranties: Provides coverage against breaches, with specific warranties.
4.No Third-Party Involvement: Involves only the buyer and seller, without third parties.
Key Contents:
•Details of the buyer, seller, and the company.
•Liabilities and obligations of both parties.
•Necessary permissions and authorizations for share transfer.
•Number and type of shares being purchased.
•Pricing and payment details.
•Rights granted to shareholders.
•Dispute resolution, arbitration, and applicable jurisdiction and law.
Shareholders' Agreement
A Shareholders' Agreement is a contract between a company's shareholders and the
company itself. It outlines the rights, obligations, and privileges of shareholders,
regulating share ownership, management, voting, and resolving potential conflicts.
Unlike the Articles of Association (AoA), which serves as a mandatory public
document and acts as the company's constitution, the shareholders' agreement is
private and flexible.
While the AoA governs the company’s operations and shareholder responsibilities, the
shareholders’ agreement focuses more on protecting shareholders' interests. It can
include some terms from the AoA but is not bound by a specific format, allowing
shareholders to tailor it to their needs. Additionally, a shareholders' agreement can
include a supremacy clause, allowing it to override the AoA if there’s a conflict,
ensuring the AoA can be amended when necessary.
The shareholders' agreement helps reduce business disputes by providing clear
procedures for decision-making and dispute resolution, complementing the AoA to
ensure both documents work together effectively.
Underwriting Agreement
Underwriting is a financial process where an individual or institution assumes the risk
associated with a venture, investment, or loan in exchange for a premium. It plays a key
role in sectors like banking, insurance, and stock markets. The term "underwriting"
originated from the practice of risk-takers signing their names beneath the risk they
assumed during the industrial revolution. In securities, underwriting involves evaluating the
risk and price of securities, especially during Initial Public Offerings (IPOs), where
investment banks purchase securities from the issuing company and sell them to the public.
This ensures the issuer raises the required capital and the underwriters earn a premium.
Underwriting benefits investors by providing valuable information for informed decision-
making. In the securities market, underwriters help stabilize prices and ensure liquidity. In
banking, underwriters assess the creditworthiness of potential borrowers by evaluating
their financial history, collateral, and other factors. In insurance, underwriters determine the
risk of insuring clients, decide on coverage terms, and establish premium amounts.
The Underwriting Agreement outlines the terms for underwriters to purchase and
distribute securities to the public. Both the issuer’s and underwriters’ legal teams negotiate
critical provisions in this agreement, which have a significant impact on the offering.
2. Types of Resolutions
1. Board Resolution

2. Ordinary Resolution

3. Special Resolution

4. Unanimous Resolution

5. Passing of Resolution by Circulation

 3 Enforceability of Pre-incorporation contract

• Companies Act, 2013 does not contain any provisions about Promoter’s Contract. The
promoters of a company usually enter into contracts to acquire some property or right for the
company which is yet to be incorporated, such contracts are called preliminary or pre
incorporation contracts
• legal position is that since presence of two consenting parties is necessary for a
contract, and the company before incorporation is a non-entity, the promoters cannot
act as agents for the company, which has yet to come into existence. As such, the
company is not liable for the acts of the promoters done before its incorporation.
4. Memorandum of association
• Memorandum of association of the company is the fundamental formation
document. It is the constitution and charter document of the company. It contains
the basic conditions on the strength of which the company is incorporated.
• Contents of MOA:
1. Name of the company
2. Registered Office of the Company
3. Objects of the Company
4. The Liability of Members
5. Capital Clause
6. Subscription Clause:
5. Articles of Association

• According to Section 2(5) of the Companies Act, 2013, ‘articles’ means the articles of
association of a company as originally framed or as altered from time to time or
applied in pursuance of any previous company law or of this Act. It also includes the
regulations contained in Table F in Schedule I of the Act, in so far as they apply to the
company.
• articles of a company shall contain the regulations for management of the company.
• It deals with the rights of the members of the company inter se. They are subordinate
to and are controlled by the memorandum of association.
7. CONTRACT OF APPOINTMENT OF MD

• According to Section 2(54) of the Companies Act, 2013, “managing director” means
“a director who, by virtue of the article of a company an agreement with the
company or a resolution passed in its general meeting, or by its Board of Directors,
is entrusted with substantial powers of management of the affairs of the company,
and includes a director occupying the position of a managing director, by whatever
name called.”
• While drafting a contract of appointment, the following points have to be taken
care of:
• The person who is being appointed as managing director must be a director of the
company; and
• He must be entrusted with substantial powers of management.
8. SPECIMEN RESOLUTIONS
• Board Resolutions for Appointment of Managing Director/CEO
• Board Resolutions for Appointment of Chief Financial Officer (CFO)
• Board Resolutions for Appointment of Whole-Time Company Secretary of the
Company
• Board Resolution for Approval of Annual Financial Statement of the Company for
the financial year ended 31st March
• Ordinary Resolutionpassed by the members of the Company for adoption of the
Directors’ Report and the Audited Balance Sheet of the Company as on 31st March
and the Statement of Profit & Loss for the year ended 31st
March with the Auditors Report thereon.
• Board Resolution Recommending Payment of Dividend on Equity Shares out of
Profits
• Ordinary Resolution for Declaration of Dividend by Members at an AGM
8. SPECIMEN RESOLUTIONS
• Board Resolution for Declaration of Interim Dividend on Equity Shares
• Board Resolution for Approval for Filing of Form CSR -1
• Resolution for Approval and Adoption of CSR Policy
• To Identify Implementing Agencies and To Approve Allocation of CSR Amount
• To approve the annual action plan for the financial year
• To approve opening of a bank a/c for unspent csr amount
• To Approve Ongoing Project and Transfer to the ‘Unspent CSR A/C’
• To Approve Transfer of Unspent CSR Amount to Specified Fund Under Schedule VII
to the Companies Act, 2013
• To Approve Appointment of Independent Agency for Undertaking Impact
Assessment
• Special Resolution for borrowing of funds under Section 180(1)(c) of the Companies
Act, 2013
8. SPECIMEN RESOLUTIONS
• To make Investments, give Loans, Guarantees and provide Securities under Section
186 of the Companies Act, 2013
• Special Resolution passed for creation of security on the properties of the company
in favour of the lenders
• Ordinary Resolution for Approval of Related Party Transactions
• Omnibus Approval of Related Party Transactions For F.Y.
MORTGAGE& ITS TYPES
◦ A mortgageis a transfer of interest in specificimmovableproperty for the purpose of securing the payment of money
advanced or to be advanced by way of a loan, existing or future debt or the performance of an acknowledgement,
whichmaygive rise to pecuniary liabilities (Section 58 of the Transfer of Property Act, 1882).
◦ Kaun banega Crorepati ? (Mortgagor & Mortgagee)
◦ 1. Any living person, company, or association or body of individuals, who has an interest on immovable property can
mortgage that interest.
◦ 2.Inthe case of a company mortgage of the property should be duly authorised by ‘Object Clause’ of the
Memorandum of Association and approved bya resolution of the Board of directors.
◦ 3. Further, for creation of a mortgage, the FinancialInstitutions usually insist on a resolution of the shareholders.
◦ 4. Any person capable of holdingproperty may take a mortgage unless he is dis-qualifiedby any special law from
doing so. A minor may be a mortgagee but as he cannotenter into a contract, the mortgage should not involve any
covenants by him.
Agar shuru karne ki himmat thi toh...

Khatam karne se kyu Ghabre rahe ho?

STUDY HARD
 DRAFTING
Art of writing Legal opinions

CS Somya Kataria (9131993373) (CS, MBA)

• A legal opinion is a written statement by a judicial officer or a legal expert based on giver’s professional understanding of a
particular aspect of any matter based on legal principles. A person might want to know the correct legal position on a matter of
interest or the likelihood of his winning a case if he initiates legal proceedings based on the information that he has supplied to
the expert.
• Some of the common purposes for which legal opinion are sought are as follows:
• 1. Lawfulness of an action: Opinion letters are given when one wants to know if an action is lawful.
• 2. Legal consequences: Sometimes a party entering into a transaction obtains legal opinion to ascertain if the action will lead to
desired legal consequences.
• 3. Answer questions: A client may be confused about an issue and they want professional guidance in the area. They also address
the question raised by other professionals. Legal opinions provide an authoritative basis for reports, opinions, and reports on
matters where other professionals lack the professional capability to make judgments. For example, an opinion regarding local
law provided to foreign counsel.
• 4. Regulatory requirements: Sometimes legal opinion has to be sought because it is mandated by law to get the opinion of
outside legal expert.
• 5. Compliance: A legal opinion can be sought for assessing the requirements of the regulatory regime so that the querist can meet
the compliance requirement.
• 6. Protective shield: Clients sometimes desire the protection of an expert’s legal opinion to be used as evidence of lack of mens
rea in certain proceedings.
• 7. Designed to mislead: Sometimes promoters of unscrupulous schemes obtain as many opinions from different experts as is
possible and use the one which is favourable to their scheme of things.
• 8. To satisfy contractual requirements: Sometimes a clause in commercial contracts require the opinion of an expert. E.g.: an opinion given by
issuer’s counsel to investors in connection with the sale of securities or by borrower’s counsel to the lender pursuant to a loan agreement.
• 9. Due Diligence: Lawyers and clients often cite
CS dueSomya
diligence Kataria (9131993373)
as the principal reason for requesting opinion letters in business transactions.
TYPES OF LEGAL OPINION
Advices on Transaction: Due diligence is the principal reason for opinion letters in business transactions. An
opinion letter may be one component of a party’s due diligence, but it is not normally a substitute for due
diligence performed by the opinion recipient and its counsel.

Advices on Law: Sometimes the client would want to know how the law will apply to a given situation.
Without in-depth knowledge of law and legal research one cannot give an opinion to the satisfaction of the
client. The proper way is to start with the cases and work through to reach a deduction as to the principle of
law that covers the situation.

Opinions on Facts: The third type of opinion is one which is predominantly related to facts. One is given a
series of statements and documents and asked whether on that material there are reasonable prospects of
prosecuting or defending the claim. The matter may be a simple personal injury case in which the law is well
settled. The real question is whether one’s side’s witnesses will be believed or not Advices on Evidence: A
special type of opinion is a brief to advice onevidence.
CS Somya Kataria (9131993373)
ELEMENTS OF OPINION LETTER
• A legal opinion will cover the following:
• 1. Introductory Matters
• i. Title: It should be entitled OPINION or ADVICE and contain the title of the case in theheading.
• ii. Date. The opinion speaks as of the date mentioned on the opinion letter and need not state
separately the effective date of the opinion.
• Iii. Addressee. The opinion is normally addressed to a specified party in an individual capacity, to
a party as representative of a larger group
• 2. Introduction: The first paragraph should serve as an introduction to the legal opinion, laying out
the salient facts and what the expert has been asked to advise about. An opinion must set out the
questions on which it is sought very clearly and unambiguously. If the Querist (which is what we call
a person who seeks the opinion) is himself confused, his questions will be equallymindless. It is
your duty as a lawyer to unravel his tangled skein of thought, identify the issues that are material
and on which the relief he wants depends, and then frame them as questions.
• 3.Definitions. For purposes of brevity and clarity, it is advisable to define the principal terms used
in the opinion. Whenever a term utilized in an opinion letter is derived from statutory law, the
opinion customarily uses that term or provides an express definition
CS Somya Kataria (9131993373)
• 4. Understanding facts of the case
• The obligation of an opinion giver to exercise diligence in determining the factual and legal bases for an
opinion is implicit in every opinion letter. The first rule is always to commence the opinion by setting out the
facts that have been given or have been presumed from the instructions given. Adopting the practice of
commencing opinion by outlining the facts upon which one is advising serves another purpose as well.
• a. Reliance on Certificates of Public Officials: These opinions customarily are based on certificates of
public officials in the various jurisdictions involved. The principal certificate among them is the Certified Copy
of the Articles of Incorporation, together with Amendments. This certification represents conclusive evidence
of the formation of the corporation and prima facie evidence of its existence for all purposes.
• a. Officer’s certificate: In business transactions opinion preparers typically obtain two somewhat analogous
types of officers’ certificates: (1) certificates verifying the authenticity of referenced documents; and (2)
certificates relating to factual matters not readily verifiable by the opinion preparers or only verifiable at
considerable cost. A common example of the first type of certificate is a certificate of the secretary of the
Company certifying that, attached to the certificate, is a true copy of the articles, bylaws and corporate
minutes or resolutions pertaining to the transaction. The second type of officers’ certificate relates to factual
matters not readily verifiable or only verifiable at considerable cost by the opinion giver when preparing the
opinion.
• b. Documentary Examination Assumptions: Opinion givers customarily assume that the signatures on all
documents examined are genuine, that copies of documents examined conform to the originals, and that such
documents are binding on the other parties. Opinion givers often state these assumptions expressly, although
by customary usage, they are implicit and need not be expressly stated. If stated, a common formulation of
CS Somya Kataria (9131993373)
the assumption is as follows:
• 5. Research on Relevant case laws
• It may even be appropriate to quote directly from the judgment although often paraphrasing the effect of the decision will usually suffice. The
case being cited must always be referred back to the facts being dealt with in the legal opinion.
• 6. Expression of the opinion
• Once the facts are organised, a legal framework needs to be constructed into which these facts can be logically slotted. A legal opinion in a
personal injury action for example will be based on negligence and therefore will usually be structured along the lines of duty, breach, damage,
causation, forseeability and contributory negligence
• 7. Qualifications: If the qualification is short and applies only to one portion of the opinion letter, it often will be included in the operative
language of the specific opinion by the reference “subject to or “except ” . If the qualification
pertains to more than one portion of the opinion letter or is lengthy, it will usually appear separately from the operative opinion clauses. Typical
clauses introducing such qualifications include the following: “our opinion in paragraph is subject to;” or “we express no opinion on the effect
of;” or “in rendering our opinion in paragraph we have assumed that .”
• 8. Special matters:
• a. Foreign Law and Reliance on Local Counsel: The principal opinion giver for a party in a business transaction typically renders an opinion
covering the laws of the state and applicable central laws and sets forth this limitation in the text of the opinion. The opinion giver may also be
requested to furnish an opinion on matters governed by the laws of some other country. b.
• b. Reliance on Opinion of ‘Special’ Counsel: Considerations similar to those arising in the selection and use of local counsel apply in the
retention of special counsel. Alawyer who has no expertise in a specialized matter should not render an opinion in the specialized area, and
should refer the matter to a lawyer qualified in that field.
• 9. Signature : The procedure typically followed by most law firms is for the opinion letter to be manually signed in the name of the firm. Some
law firms follow different practices, such as “XY&Z by A, a partner” or “A on behalf of XY&Z.”
• 10. Usual disclaimers: Disclaimers can save the opinion giver from being reported for malpractice if the opinion is wrong. Under the disclaimer, it
is written that the opinions provided are based on the law as per the time of drafting the opinion. Moreover, it is also indicated that the opinion
is also based on the documents and facts provided. All the documents that the clients provided for the sake of drafting the legal opinion can also
be listed. CS Somya Kataria (9131993373)
THINGS TO BE KEPT IN MIND WHILE PREPARING FOR OPINION
1. Opinions that are not cost effective
In determining whether a particular opinion is appropriate under the circumstances and, if so, what the nature and scope of that opinion should be,
the opinion giver must consider the costs of giving the opinion relative to the benefits to the client of satisfying the request of the opinion recipient.
2. Inappropriate scope:
In a business transaction a number of opinions would be considered inappropriate because their scope is not reasonably within the competence of
the opinion giver or they are not cost-justified. Examples of such opinions include the following:
• the client is qualified to do business as a foreign corporation in all jurisdictions in which its property or activities require qualification or in which
the failure to qualify would have a material adverse effect on the client;
• the client is not in material violation of any central, state or local law, regulation or administrative ruling;
2. Confirmation of facts: Negative assurance The function of a legal opinion is to provide informed judgments on matters of law, not assurance
regarding factual statements that the parties to a transaction are in a better position to verify. An opinion giver normally should not be asked to
state that it lacks knowledge of particular factual matters. Opinion givers generally should not be asked for opinions on the outcome of pending or
threatened claims or legal actions.
3. Opinions regarding issues of significant Legal uncertainity
An opinion giver should not render an unqualified opinion on an issue as to which there is significant uncertainty. If there is disagreement regarding
the existence or degree of the legal uncertainty, a compromise is sometimes reached in the form of a “reasoned” opinion. In that situation, the
opinion giver does not simply express a legal conclusion but also presents a discussion of relevant statutory and judicial authorities, often (but not
always) indicating that the matter is uncertain or “not free from doubt,” and stating a prediction of the likely judicial resolution of the matter if the
issue were appropriately presented to a court of competent jurisdiction.
CS Somya Kataria (9131993373)
• 4. Fraudulent or Misleading Opinions and the Limits of Professional Competence
A lawyer should not render an opinion that the lawyer knows would be misleading. In addition, a lawyer should not render an opinion based on
factual assumptions if the lawyer knows that the assumptions are false or that reliance on those facts is unreasonable.
• 5. The Time to prepare Opinion Letter
Sometimes one may be faced with the necessity of giving an urgent opinion or one when the time is not available to allow one to perform the depth
of research one would wish. This may occur because the matter is truly urgent or more often because either the lawyer or professional client has
delayed moving for advice until the last possible moment. In such a case one should qualify the opinion with a disclaimer.

STANDARDS APPLICABLE TO PREPARATION OF AN OPINION

1. Generally: Alawyer is expected to be well informed and to exercise such skill, prudence and diligence as lawyers of ordinary skill and
capacity commonly possess and exercise in the performance of the tasks which they undertake. When a matter falls within a recognized
area of legal specialty, such as tax or securities law, it is advisable to take that assignment only if it falls within the competence of the
professional.
2. Customary Practice: An attorney does not ordinarily guarantee the soundness of his opinions and, accordingly, is not liable for every
mistake he may make in his practice. He is expected, however, to possess knowledge of those plain and elementary principles of law which
are commonly known by well informed attorneys, and to discover those additional rules of law which, although not commonly known, may
readily be found by standard research techniques.
3. Fraudulent or Misleading Opinions
• An opinion giver may be liable for an opinion that constitutes fraudulent misrepresentation. A lawyer owes a duty to non-clients to
refrain from fraudulent misrepresentation. It is generally understood that, regardless of compliance with other standards, and even if
an opinion is technically correct, a lawyer should not render an opinion that the lawyer recognizes would be misleading to the
CS Somya Kataria (9131993373)
opinion recipient.
 • Process of forming an opinion under CSAS-3
Step 1: Materiality Principles
The Auditor must consider the following principles when forming an opinion:
•Completeness: All relevant audit evidence must be considered.
•Objectivity: Professional judgment and skepticism are required to ensure accurate and relevant findings.
•Timeliness: The report must be prepared on time.
•Contradictory Process: Accuracy should be checked, and responses from concerned parties should be incorporated. The auditor may also consider
various judgments and conflicting opinions.
Step 2: Precedence and Practices
The Auditor must adhere to established best practices and precedents from historical audits while forming their opinion.
Step 3: Third Party Reports/Opinions
When relying on third-party reports or opinions, the Auditor must:
•Indicate the use of the third-party report and its necessity.
•Disclose if the third-party report was provided by the auditee.
•Consider key findings from the third party.
•If feasible, conduct supplemental tests to verify the third-party information.
Step 4: Form of Opinion
•Unmodified Opinion: Issued when the audit evidence shows compliance with laws, records are free from misstatements, and laws are followed.
•Modified Opinion: Issued when there is non-compliance with laws, records are misstated, or sufficient evidence cannot be obtained to form a
conclusion.
•Limitation: If audit scope is limited, the Auditor should ask the appointing authority to remove the limitation. If not, alternative procedures should be
considered, and if insufficient evidence remains, the opinion may be modified or disclaimed.
Step 5: Auditor's Responsibility
The Auditor’s Report must:
•State the responsibility is to express an opinion on compliance and record maintenance.
•Clarify that the audit is conducted in accordance with standards.
•Acknowledge the risk of undetected misstatements due to inherent audit limitations.

CS Somya Kataria (9131993373)

Step 6: Format of the Report
•The report should be addressed to the appointing authority unless otherwise specified.
•The report should be detailed, following prescribed formats if applicable.
•If necessary, annexes should be used for information not included in the report body.
•The signature block must include the auditor's details, and the report's date and location of signing should be clearly mentioned, especially if signed by
different individuals.

CS Somya Kataria (9131993373)

 Agar shuru karne ki himmat thi toh...

Khatam karne se kyu Ghabre rahe ho?

CS Somya Kataria (9131993373)

STUDY HARD

CS Somya Kataria (9131993373)

 UNIT 8:
DRAFTING
Commercial Contract Management

CS Somya Kataria (9131993373)

Purpose of Contract

Avoids Misunderstanding and Legal Disputes

Acts as a Record of the Business
Evidence in Court of Law
Increases Operational Efficiency
Proof of Details
Provides Security
Provides Confidentiality
Prevents Conflicts and Minimizes Risk
Record of Commitment

CS Somya Kataria (9131993373)

Summary of Commercial Contracts and Vendor Negotiation

Commercial Contracts Overview

Legally binding agreements between two or more parties regulating business
•Definition:
relationships.
•Purpose: Define rights, obligations, commercial terms, and dispute recourse.
•Types: Ranges from standard employment agreements to complex merger and acquisition
contracts.
•Key Elements: Specifies obligations, legal protections, and consequences of breaches.
•Governing Laws in India:
•Indian Contract Act, 1872: Establishes foundational principles, claims for damages,
and indemnity.
•Specific Relief Act, 1963 (SRA): Provides remedies such as specific performance,
contract rescission, and rectification of instruments.

CS Somya Kataria (9131993373)

Negotiation of Best Commercial and Operational
Terms with Vendors
1. Prepare a Plan
•Define the services/products, payment terms, timelines, cancellation clauses, and penalties.
2. Finalize the Communication System
•Establish frequent and transparent communication to build trust.
•Ensure timely responses and designate a single point of contact.
3. Offer Competitive Prices
•Conduct research on market prices before finalizing rates.
•Study competitor pricing for better negotiation.
4. Respect Vendor Expertise and Foster Long-Term Relationships
•Acknowledge vendor experience and express interest in mutual growth.
5. Be Open to Competition
•Obtain multiple vendor quotes to maintain pricing control.
•Request quotations for different quantities to optimize cost-benefit analysis .
6. Explore Other Negotiable Aspects
•If price negotiations are difficult, focus on terms like payment schedules, interest rates, or discounts.
7. Use Deposits to Build Trust
•Providing deposits can assure vendors of timely payments, improving confidence and trust.
8. Aim for a Win-Win Solution
CS Somya Kataria (9131993373)
•Strive for mutually beneficial agreements to strengthen long-term business relationships.
Good Contract: Analysis
General and Special Conditions of a Contract
General Conditions The general terms and conditions of the contract
include but not limit to the following:
1. Legal Status of the Parties
2. Definitions
3. Interpretation Clause
4. Object/ Scope of Work and/or Services
5. Representations and Warranties
6. Contractual Period
7. Fees and Taxes
8. Payment Method
9. Commencement Date
10. Rights and Obligations of the Contractual Parties
11. Termination of Contract CS Somya Kataria (9131993373)
12. The Right of Withdrawal from the Contract
13. Disclaimer of Warranty
14. Indemnification
15. Limitation of Liability
16. Confidentiality
17. Force majeure/Mitigating Factors
18. Jurisdiction
19. Dispute Resolution
20. Damages
21. Entire Contract and Precedence in case of inconsistency clause
Special Conditions
As the name suggests, special conditions are special as per the nature of the contract.
These conditions cannot be common for all the contracts. Few instances of special
conditions are as follows.
• Sub-Contracting
• Data Deletion and/or Data Purging Clause
• Assignment
• Privilege and Immunities
• Additional Scope of Work
• Tax Exemption
• Alternative Dispute Resolution
CS Somya•Kataria
Choice of Law
(9131993373)
CONTRACT RELATED DOCUMENTS AND
CORRESPONDENCE

CS Somya Kataria (9131993373)

MAINTENANCE OF CONTRACT DOCUMENTS
• Types of Maintaining Contract Documents
a) A manual document management system (DMS) is controlled by humans. This could involve
a physical filing system where employees manually file documents or an online system where
employees enter data into a database
b) An electronic document management system (EDMS), on the other hand, is a system that is
controlled by computers. This could involve an online system where employees access files
remotely or an offline system where employees download files to their computers.

Document Management vis-à-vis Contract Management

Document Management Contract Management

Document management includes maintaining, arranging and storing the Contract management includes elements of
documents for better tracking and retrieval, when necessary, but it does not negotiation, risk management, and compliance.
include features like negotiation, risk management, and compliance.

Document management is simply the process of organizing and storing Contract management is the process of
documents. negotiating, drafting, executing, and managing
CS Somya Kataria (9131993373)contracts.
 Document management helps businesses find specific Contract management helps businesses manage their
documents quickly and easily. contractual obligations effectively.
Document management is a sketchy solution that helps Contract management is a more comprehensive solution
businesses organize and track documents. that includes risk management, compliance, and the
negotiation of contracts.
Document management is more beneficial for businesses Contract management is more beneficial for businesses
that need to find specific documents quickly and easily. that need to manage contractual obligations.

Golden Rules for Tracking the Contract for Renewals, Extension and Closure:12
Following are the golden rules which help in the effective tracking of the contracts
Best Practices for Contract Management
1.Storage of Contracts
Contracts should be stored in a secure location to ensure safe custody. Additionally, keeping a readily available copy of the
contract document is advisable. For organizations handling a large volume of contracts, online contract management systems
can be highly beneficial for easy access and organization.
2.Reminder Systems
Implementing an automated reminder system is essential to notify users well in advance of any upcoming contract-related
activities. This helps ensure timely actions and prevents missed deadlines.
3.Classification of Contracts
Contracts should be categorized based on their significance. High-stake contracts with minimal error margins require special
attention to ensure prompt and appropriate action when needed. Proper classification aids in prioritizing and managing contracts
efficiently.
4.Advance Stakeholder Communication
Each organization has its own processes, and decision-making may occur at specific intervals. To avoid last-minute approvals
or rushed decisions, it is important to inform relevant stakeholders well in advance about contractual deadlines, renewals, and
obligations.
CS Somya Kataria (9131993373)
 TRACKING OF CONTRACTS AND EXTEND,
RENEW AND CLOSE

1. Preparation of the Draft

2. Negotiating and Finalising the terms and
conditions of the Contract
3. Signing of the Contract
4. Storage of the Contract
5. Work Execution or performance as agreed in the
Contract
6. Making Payments
7. Renew or Closure of the Contract

CS Somya Kataria (9131993373)

Charges/Payment of Services – Outside the Scope of the Contract: Indian Legal Perspective15
The three conditions under section 70 of Indian Contract Act, 1872 are as follows:
• The first condition is that the claimant should either lawfully do something for another person or deliver something to him.
The second condition is that while doing or delivering something, the claimant must not be acting gratuitously and
• Thirdly, the person for whom something is done or to whom something is delivered must enjoy the thing done for or
delivered to him as the case may be

ACTION IN CASE OF BREACH OF CONTRACT

Section 73 – deals with compensation for loss or damage caused by breach of contract
Essentials:
• No compensation shall be given to any remote and indirect loss or damage sustained by reason of breach.
• Compensation in regard to failure to discharge obligation which resembles those created by the contract.
• An obligation resembling those created by contract has been incurred and has not been discharged, any person affected by the
failure to discharge it is entitled to receive the same compensation from the party in default as if such person had contracted to
discharge it and had broken his contract.
• Compensation for loss or damage which naturally arose in the usual course of things from such breach.
• Compensations to be recovered for loss or damage which the parties knew or which would have naturally arisen in the usual
CS of
course, to be likely to result from the breach Somya
it. Kataria (9131993373)
 • Section 74 provides for the measure of damages in two classes: (a) where the contract names a sum to be paid in case of breach;
and (b) where the contract contains any other stipulation by way of penalty (Fateh Chand v. Balkrishna Das [1964] 1 SCR 515).
• In Vijaya Minerals v. Bikash AIR 1996 Cal. 67, the Hon’ble Calcutta High Court has observed that since manganese and iron ore
are not ordinary items of commerce, if a contract for sale of iron and manganese ore from a mine has been made, specific
performance of such an act would be allowed.
An Injunction
Under Section 36 of Specific Relief Act 1963, an injunction is defined as an order of a competent court, which:

i. Forbids the commission of a threatened wrong,

ii. Forbids the continuation of a wrong already begun, or
iii. Commands the restoration of the status quo (the former course of things).

• Temporary or interim injunctions are governed by Order 39 of Civil Procedure Code 1908 and are those
injunctions that remain in force until a specified period of time, e.g. 15 days, or till the date of the next hearing.
Such injunctions can be granted at any stage of the suit.
• Permanent or perpetual injunctions, as under Sections 38 to 42 of the Specific Relief Act, 1963 are contained in
the decree passed by the Court after fully hearing the merits of the case. Such an injunction permanently
prohibits the defendant from committing an act which would be contrary to the plaintiff’s rights.
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When are perpetual injunctions granted?

1. Where there is no standard for quantifying the actual damages caused, or likely to be caused, to the plaintiff,
by the invasion of his rights;
2. Where invasion of the plaintiff’s rights is such that any compensation in money would be inadequate relief;
3. the defendant is a trustee of the property for the plaintiff;
4. Where the injunction is necessary to prevent multiplicity of judicial proceedings.

Mandatory injunctions are granted in cases where in order to prevent the non- performance of an obligation, it is
necessary to compel the performance of certain acts which the Courts are capable of enforcing. Thus, the Court
may at its discretion grant an injunction to prevent such non-performance and also to compel performance of the
required acts. This injunction is applicable to the breach of any obligation. It may be permanent or temporary,
although temporary-mandatory injunctions are rare.

CS Somya Kataria (9131993373)

 Agar shuru karne ki himmat thi toh...

Khatam karne se kyu Ghabre rahe ho?

CS Somya Kataria (9131993373)

STUDY HARD

CS Somya Kataria (9131993373)

UNIT 1: JUDICIAL AND ADMINISTRATIVE FRAMEWORK

TYPES OF COURTS AND THEIR JURISDICTION

TYPES OF
COURTS

Supreme Lower Revenue

High Court
Court Court Court

1. Supreme court:

The Supreme Court exercises original jurisdiction exclusively to hear the cases of disputes between
the Central Government and the State Governments or between the States. The Supreme Court has
original but not exclusive jurisdiction for enforcement of Fundamental Rights as per the provision of
Constitution of India through the way of writs. This court is also an appellate court.

Supreme Court has the power to exercise extra ordinary jurisdiction to hear any appeal related to
any matter for which any court or tribunal had decided with judgment through the option of special
leave petition except the case of tribunal related to Armed Forces.

2. High Court:

High Courts also hear appeals against the orders of lower courts. Article 227 of Indian Constitution
has empowered all High courts to practice superintendence over all the courts of tribunal effective
within the regional jurisdiction of the High Court. All the High Courts have the power to pronounce
punishment for contempt of court.

3. Lower Courts:

The court at the district level has a dual structure that runs parallel- one for the civil side and one for
the criminal side. The civil side is simply called the District Court and is headed by the district judge.
There are additional district judges and assistant district judges who are there to share the additional
load of the proceedings of District Courts. These additional district judges have equal power like the
district judges for the jurisdiction area of any city which has got the status of metropolitan area as
conferred by the state government.

The criminal court at the district level is headed by the Sessions Judge. Usually there are Additional
Sessions Judges as well in the Court to share the workload of the Sessions Judge. The subordinate
courts covering the criminal cases are Second Class Judicial Magistrate Court, First Class Judicial
Magistrate Court, and Chief Judicial Magistrate Court along with family courts.

4. Revenue Courts:

These are ‘courts’ but are not a part of Judiciary because they come under the administration of the
State governments. Revenue courts deal with matters pertaining to stamp duty, registration etc.
 5. E-Courts

The eCourts Project aims to transform the Indian Judiciary by integrating Information and
Communication Technology (ICT) into the court systems, with the goal of making the justice
delivery system more efficient, accessible, transparent, and citizen-centric. This initiative was
launched based on the National Policy and Action Plan for Implementation of ICT in the Indian
Judiciary, created by the eCommittee of the Supreme Court of India.

Key objectives of the eCourts Mission Mode Project include:

1. Efficient Citizen-Centric Service Delivery: Providing timely and accessible services to citizens, as
defined in the eCourt Project Litigant's Charter.
2. Automating Court Processes: Implementing decision support systems to streamline and automate
judicial processes, enhancing transparency and accessibility.
3. Improving Judicial Productivity: Both qualitatively and quantitatively, the project aims to make
the justice system more affordable, reliable, and predictable.

Major Achievements:

• eCourts National Portal: Launched in August 2013, the portal (ecourts.gov.in) provides
information like case status, cause lists, and judgments for over 2,852 districts and taluka court
complexes. It hosts data for over 7 crore cases and 3.3 crore orders/judgments, which is updated
in real-time.
• National Judicial Data Grid (NJDG): This serves as a national data warehouse, providing
comprehensive case and order data for all district courts, which supports policy analysis and
decision-making.
• Use of Open Source Software: The eCourts Project is one of the largest Free and Open Source
Software (FOSS) initiatives globally, saving the government substantial costs and offering
customization freedom.
• Core-Periphery Model: The project utilizes a two-tier structure, where the core data is centrally
controlled (by the eCommittee), and the peripheral modules are customizable by each High Court
to cater to state-level needs.
• Citizen-Centric Focus: The project prioritizes services for litigants, resulting in extensive
coordination among judicial officers and court staff to ensure the project's success.

Key Services and Tools:

• Online Case Status: Parties can check the status of cases, caveats, and court orders through the
portal.
• Cause Lists and eFiling: The system allows access to cause lists, online appearances, and eFiling
options for the convenience of users.
• Video Conferencing & Virtual Courts: These tools facilitate remote hearings, enhancing
accessibility.
• Judicial Performance Tools: The system includes tools for analyzing judicial performance and case
management.

By May 2024, the eCourts Project had expanded to 39 High Court complexes and 3,531 District and
Taluka Court complexes, providing services that include case tracking, ePayments, and live streaming of
hearings.

TRIBUNALS
Tribunals in India are a part of the Executive branch of the Government which are assigned with the powers and
duties to act in judicial capacity for settlement of disputes.

1. Debt Recovery tribunal (DRT):

The Debt Recovery Tribunals have been constituted under Section 3 of the Recovery of Debts Due to Banks and
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Financial Institutions (RDDBFI) Act, 1993. The original aim of the Debts Recovery Tribunal was to receive claim
applications from Banks and Financial Institutions against their defaulting borrowers. (DRT) was
established for expeditious adjudication and recovery of debts due to banks and financial institutions in order
to reduce the non-performing assets of the Banks and Financial Institutions. DRT acts as a single judicial forum
for adjudication of cases as well as execution of the decrees passed for recovery of debts due to banks and
financial institutions under RDDBFI Act and Securitisation and Reconstruction of Financial Assets and
Enforcement of Security Interests (SARFAESI) Act, 2002.

National Company Law Tribunal (NCLT) is a quasi-judicial body exercising equitable jurisdiction, which was
earlier being exercised by the High Court or the Central Government. It has been established by the Central
government under section 408 of the Companies Act, 2013 with effect from 1st June 2016. The Tribunal has
powers to regulate its own procedures.

The establishment of the National Company Law Tribunal (NCLT) consolidates the corporate jurisdiction of the
following authorities:

i) Company Law Board

ii) Board for Industrial and Financial Reconstruction.

iii) The Appellate Authority for Industrial and Financial Reconstruction

Jurisdiction and powers relating to winding up restructuring and other such provisions, vested in the High
Courts.

2. Consumer Forum:

To protect the rights of the consumers in India and establish a mechanism for settlement of consumer
disputes, a three-tier redressal forum containing District, State and National level consumer forums has been
set up.(District: upto 20 lakhs, State: upto 1 crore, National: above 1 cr). Free services are not entertained.

3. Motor Accident Claims Tribunal (MACT):

It deals with matters related to compensation of motor accidents victims or their next of kin. Victims of motor
accident or legal heirs of motor accident victims or a representing Advocate can file claims relating to loss of
life/property and injury cases resulting from Motor Accidents. Motor Accident Claims Tribunal are presided
over by Judicial Officers from the State Higher Judicial Service.

4. Central Administrative Tribunal:

For adjudication of disputes with respect to recruitment and conditions of service of persons appointed to
public services and posts in connection with the affairs of the Union or other local authorities within the
territory of India or under the control of Government of India.

5. National green tribunal:

National Green Tribunal was established for effective and expeditious disposal of cases relating to
environmental protection and conservation of forests and other natural resources including enforcement of
any legal right.

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NCLT:

PROCEDURAL ASPECTS OF WORKING OF CIVIL COURTS

1. Jurisdiction:

The jurisdiction is basically of three types.

(a) Pecuniary
(b) Territorial: The territorial jurisdiction is conferred on a court by following factors:-
(i) By virtue of the fact of residence of the Defendant
(i) By virtue of location of subject matter within jurisdiction of the court.
(i) By virtue of cause of action arising within jurisdiction of such court.
(c) As to subject matter: For example, Motor Vehicles Act provides for special tribunal for matters
under it. Similarly disputes relating to terms of service of government servants go to
Administrative Tribunals.( The first and fundamental rule governing jurisdiction is that suit shall be
instituted in the court of lowest grade competent to try it.)

2. Stay:
The application for stay of suit is maintainable at any stage of the suit. The court does not have option
to refuse on ground of delay.

3. Res Judicataand bar to further suits

The basic principle is that a final judgement rendered by a court of competent jurisdiction is conclusive
on merits as to rights of the parties and constitutes an absolute bar against subsequent action involving
the same claim. The principle of res judicata applies only under following circumstances:

(i) The matter directly and substantially in issue has been directly and substantially in issue in a former
suit between same parties or between whom they claim litigation under the same title.

(ii) The matter is in the court competent to try such subsequent suit or the suits in which such issue has

been subsequently raised and has been heard and finally decided.

4. Plaint:

Plaint is the actual starting point of all pleadings in a case. Though the law has not laid down any tight
jacket formats for plaints, its minimum contents have been prescribed. A document, which has to be
produced and has not been produced at the time of presenting the plaint cannot be received in evidence
at the hearing of the suit without permission from the concerned court. The court has power to reject
the plaint on following grounds:

a) Where it does not disclose the cause of action.

b) Where the relief claimed is undervalued and Plaintiff fails to correct the valuation within the time
fixed.

c) If the relief is properly valued but insufficient court fee / stamp is paid and the Plaintiff fails to make
good such amount.

Where the suit appears to be barred by any law, from the statements in the plaint.

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 5. Summons:

It is a process directed to a proper officer requiring him to notify the person named, that an action has been
commenced against him, in the court from where process is issued and that he is required to appear, on a
day named and answer the claim in such action.

Where the court is satisfied that there is reason to believe that the Defendant is keeping out of the way for
purpose of avoiding service or that for any others reason the summons cannot be served in ordinary way
the court shall order summons to be served by affixing copy thereof in conspicuous part of the house.

6. Appearance of parties:
If the Defendant is absent court may proceed ex-parte. Where on the day so fixed it is found that summons
has not been served upon Defendant as consequence of failure of Plaintiff to pay the court fee or postal
charges the court may dismiss the suit. Where neither the Plaintiff nor the Defendant appears the court may
dismiss the suit.

If the Defendant appears and Plaintiff does not appear and the Defendant does not admit the Plaintiff’s claim
wholly or partly, court shall pass order dismissing the suit. It Defendant appears and admits part or whole of
the claim the decree will be passed accordingly.

7. Adjournments:

Adjournments frequently sought by the parties contribute significantly to the delays caused in deciding the
matters. The granting of adjournments is at the discretion of the court.
8. Ex-parte decrees:

A decree against the Defendant without hearing him or in his absence/in absence of his defence can be
passed under the following circumstances:-

(i) Where any party from whom a written statement is required fails to present the same within the time
permitted or fixed by the court, as the case may be the court shall pronounce judgement against him,
or make such order in relation to the suit as it thinks fit and on pronouncement of such judgement a
decree shall be drawn up.

(ii) Where Defendant has not filed a pleading, it shall be lawful for the court to pronounce judgement on
the basis of facts contained in the plaint, except against person with disability.

(iii) Where the Plaintiff appears and Defendant does not appear when suit is called up for hearing and
summons is property served the court may make an order that suit will be heard ex parte.
If an exparte decree is passed and the Defendant satisfies that he was prevented by sufficient cause then
he has the following remedies open:
(i) Prefer appeal against decree.

(ii) Apply for Review.

(iii) Apply for setting aside the Ex-parte Decree.

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 9. Interlocutory proceedings:

Interlocutory orders are provisional, interim, temporary as compared to final. It does not finally determine
cause of action but only decides some intervening matter pertaining to the cause. The procedure followed
in the court is that the separate application for interim relief is moved at the time of filing of suit or at a
subsequent stage.

10. Written statement:

The Defendant is required to file a written statement of his defence at or before the first hearing or such
time as may be allowed along with the list of documents relied upon by him. If Defendant disputes
maintainability of the suit or takes the plea that the transaction is void it must be specifically stated. A
general denial of grounds alleged in the plaint is not sufficient and denial has to be specific.

11. Examination of parties:

Where admission of facts have been made either in the pleading or otherwise, whether orally or in writing,
the court may at any stage of the suit, either on the application of any party or of its own motion and without
waiting for determination of any such question between the parties, make such order or give such
judgement as it may think fit.

12. Production of documents:

The parties or their pleaders shall produce at or before the settlement of issues, all documentary evidence
of every description in their possession or power, on which they intend to rely, and which has not been filed
in the court or ordered to be produced.

13. Framing of issues:

Court is required to pronounce judgement on all the issues. Issues may be framed from allegations made on
oath by the parties or in answer to interrogatories or from contents of documents produced by either party.
If the court is of the opinion that the case or any part thereof may be disposed of on issue of law only, it may
first try it, if issue relates to:-

(i) Jurisdiction of the court,

(ii) Bar to the suit created by law for the time being in force.

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 14. Summoning and attendance of witness

On the date appointed by the court and not later than 15 days after the date on which issues are settled
parties shall present in court a list of witnesses whom they propose to call either to give evidence or to
produce documents. The judge shall make or dictate on a typewriter or cause to be mechanically recorded,
a memorandum of the substance of deposition of witnesses. A witness may be examined on commission
also. If signature of witness is not taken on any part of deposition or correction it does not make deposition
invalid.

15. Affidavits:

Affidavit shall contain only such facts as the deponent is able of his own knowledge to prove except on
interlocutory applications on which statement of belief may be admitted provided grounds are stated.
The affidavits have to be properly verified to avoid any dispute at a later stage

16. Final argument:

Once the documents have been exhibited in the court and the witness(es) of both the sides examined and
cross-examined, the stage is set for ‘final arguments’. It allows both the sides to present its case after taking
into account the submissions made by the witnesses of the other party and the documents produced by it.
17. Judgement:
Where judgment is not pronounced within 30 days from the date on which hearing of case was concluded,
the court shall record the reasons for such delay.

The last paragraph of the judgment shall indicate in precise terms the relief, which has been granted by such
judgment. Every endeavor shall be made to ensure that the decree is drawn as expeditiously as possible and
in any case within 15 days from the date on which the judgment is pronounced.

The court also has the power to award ‘cost’. If on any date fixed for hearing, a party to the suit fails to take
step or obtains adjournment for producing evidence, the court may also award costs for causing delay. If the
court finds, that the claim or defense as against the objector is false or vexatious to the knowledge of the
party by whom it has been put forward, and if such claim is disallowed, abandoned or withdrawn, court
holding the claim false or vexatious may order compensatory costs.

18. Decree and execution

After the decree is passed the process of execution which involves actual implementation of the order of the
court through the process of the court starts the entire process of executing of decree.

TYPES OF CRIMINAL TRIALS

1. Warrant cases

A warrant case is one which relates to offences punishable with death, imprisonment for life or
imprisonment for a term exceeding two years. The trial in warrant cases starts either by the filing of FIR in a
police station or by filing a complaint before a Magistrate. Later, if the Magistrate is satisfied that the offence
is punishable for more than two years, he sends the case to the Sessions court for trial. The process of

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 sending it to Sessions court is called “committing it to Sessions court”.
Important features of a warrant case are:
• Charges must be mentioned in a warrant case

• Personal appearance of accused ismandatory

• A warrant case cannot be converted into a summons case

• The accused can examine and cross-examine the witnesses more than once.

A. Different stages of criminal trial when instituted by police report:

1. FIR: An FIR is information given by someone (aggrieved) to the police relating to the commitment of an
offense.

2. Investigation: A conclusion is made by the investigating officer by examining facts and circumstances,
collecting evidence, examining various persons and taking their statements in writing and all the other
steps necessary for completing the investigation and then that conclusion is filed to the Magistrate as
a police report.

3. Charges: If the accused is not discharged then the court frames charges under which he is to be tried. In
a warrant case, the charges should be framed in writing.

4. Plea of guilty: After framing of the charges the accused is given an opportunity to plead guilty, and the
responsibility lies with the judge to ensure that the plea of guilt was voluntarily made.

5. Prosecution evidence: The prosecution is required to support their evidence with statements from its
witnesses. This process is called “examination in chief”.

6. Statement of the accused: The statements of accused are not recorded under oath and can be used
against him in the trial, instead he is given opportunity of being heard.

7. Defense evidence: An opportunity is given to the accused to produce evidence so as to defend his
case. The defense can produce both oral and documentary evidence.

8. Judgement: In case the accused is acquitted, the prosecution is given time to appeal against the order
of the court. When the person is convicted, then both sides are invited to give arguments on the
punishment which is to be awarded.

B. Different stages of criminal trial when Private complaint institutes case:

It may sometimes happen that the police refuses to register an FIR. In such cases one can directly
approach the criminal court under Section 156 of CrPC. On the filing of the complaint, the court will
examine the complainant and its witnesses to decide whether any offence is made against the accused
person or not. After examination, the court may accept the appeal, and then the Magistrate may issue
a warrant or a summon depending on the facts and circumstances.

2. Summon cases:

Those cases in which an offence is punishable with an imprisonment of fewer than two years is a
summon case.
Stages of Criminal Trial in Summary Cases

• The procedure followed in the summary trial is similar to summons-case.

• Imprisonment up to three months can be passed.

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 • In the judgement of a summary trial, the judge should record the substance of the evidence and a
brief

• statement of the finding of the court with reasons.

REFERENCE AND REVISION UNDER CRIMINAL PROCEDURE CODE

Reference
Court subordinate to the High Court to make a reference to the High Court under sub-section (1) if following
conditions exist: –

(1) The case pending before it must involve a question as to validity of any Act, Ordinance or
Regulation. A mere plea raised by a party challenging the validity of an Act is not sufficient to
make a reference to the High Court

(2) Secondly, the Court should be of the opinion that such Act, Ordinance Regulation, as the case may
be, is invalid or inoperative but has not been so declared by High Court or by the Supreme Court.

(3) While making a reference to the High Court, the Court shall refer to the case setting out its opinion
and reasons for making a reference.

REVISION

Section 397 empowers the High Court and the Sessions Judge to call for records of any inferior
Criminal Court and examine them for themselves as to whether a sentence, finding or order of such
inferior Court is legal, correct or proper and whether the proceedings of such Court are regular or
not, with a view to prevent miscarriage of justice and perpetuation of illegality.

The revisional Court has the power to order the release of offender on bail or bond under Section
397 (1). The discretion in this regard should, however, be used judicially considering all the
circumstances of the case. Dismissal of revision by the High Court without assigning reasons is not
sustainable and matter may be remitted to the Court for reconsideration.
No Second revision:
Sub-section (3) of Section 397 permits only one revision therefore if an application is made to a
Sessions Judge and he is of the opinion that it should be referred to the High Court, then a fresh
application for revision can be made to the High Court. But the sub-section bars an application for
the revision to the High Court if a person has already applied for it to the Sessions Judge or vice
versa.
A person can directly move a revision application to the High Court without first approaching the
Sessions Judge. But if he moves the Sessions Judge he cannot thereafter approach the High Court for
another revision.
The general rule in this regard is that a concurrent jurisdiction is conferred on two Courts, the
aggrieved party should ordinarily first approach the inferior Court, i.e., the Sessions Judge in the
context of Section 397(3) unless exceptional grounds for taking the matter directly to the higher
Court (High Court in this case) are made out.
Sessions Judge’s powers of revision (Section 399 of CrPC)
(1) In the case of any proceeding the record of which has been called for by himself, the
Sessions Judge may exercise all or any of the powers which may be exercised by the High
Court under Section 401(1) of the Code.

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 (2) Where any proceeding by way of revision is commenced before a Sessions Judge under
sub-section (1), the provisions of sub-sections (2), (3), (4) and (5) of Section 401 shall, so
far as may be, applied to such proceeding and references in the said sub-sections to the
High Court shall be construed as references to the Sessions Judge.
Where any application for revision is made by or on behalf of any person before the Sessions Judge,
the decision of the Sessions Judge thereon in relation to such person shall be final and no further
proceeding by way of revision at the instance of such person shall be entertained by the High Court
or any other Court.
No Revision where right to Appeal exists:
The Cr.P.C. provides a remedy, by way of appeal and if the party does not file an appeal against an
order of the inferior criminal Court, he will not be permitted to prefer a revision against that order.
But legal bar does not stand in the way of High Court’s exercise of power of revision suo motu\
Enhancement or reduction of sentence:
There is no limitation on the power of the High Court as regards enhancement of sentence to the
extent of maximum prescribed by the Penal Code, except in cases tried by Magistrates. But before
doing so, the Court has to be issued a show-cause notice against the enhancement of his sentence.
If after hearing the State, i.e., the Government pleader, the High Court comes to a conclusion that the
sentence imposed on the accused is too severe and needs to be reduced, it may reduce it exercising
its revisional jurisdiction

REFERENCE, REVIEW AND REVISION UNDER CIVIL PROCEDURE

Review means re-examination or re-consideration of its own decision by the very same court. An
application for review may be necessitated by way of invoking the doctrine ‘actus curiae neminem
gravabit’ which means an act of the court shall prejudice no man. The other maxim is, ‘lex non cogit
ad impossibillia’ which means the law does not compel a man to do that what he cannot possibly
perform.

Review- Subject as aforesaid, any person considering himself aggrieved –

(a) by a decree or order from which an appeal is allowed by this Code, but from which no appeal has
been preferred,

(b) by a decree or order from which no appeal is allowed by, this Code, or

(c) by a decision on a reference from a Court of Small Causes,

may apply for a review of judgment to the court which passed the decree or made the order, and the court may

make such order thereon as it thinks fit.

Conditions precedent for review are as follows:

1. Discovery of new and important matter or evidence:
An application for review on the ground of discovery of new evidence should show that: (i) such
evidence was available and of undoubted character; (ii) that the evidence was so material that its
absence might cause a miscarriage of justice; and (iii) that it could not with reasonable care and
diligence have been brought forward at the time of the decree.

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 2. Mistake or error apparent on the face of the record:

The mistake is not limited to a mistake of fact. It may be of law. It should be an error which can
be seen by a mere perusal of the record without reference to any other extraneous matter.
Failure of the court to take into consideration an existing decision of the Supreme Court taking a
different or contrary view on a point covered by its judgment would amount to a mistake or error
apparent on the face of the record. But a failure to take into consideration a decision of the High
Court would not amount to any mistake or error apparent on the face of the record.
3. Any other sufficient reason:
Any excusable failure to bring to the notice of the court new and important matter or evidence or
mistake

DIFFERENCE BETWEEN APPEAL AND REVIEW:

1. There are definitive limits to the exercise of the power of review and it cannot be exercised on
the ground that the decision was “erroneous on merits. That would be the province of a Court of
Appeal. A power of review is not to be confused with appellate power which may enable an
appellate court to correct all manner of errors committed by the subordinate Court
2. Scope of an application for review is much more restricted than that of an appeal.
3. power of review can only be exercised for correction of a mistake and not to substitute a view,
Where an appeal has been preferred a review application does not lie
4. an appeal may be filed after an application for review. In such event the hearing of the appeal
will have to be stayed. If the review succeeds the appeal becomes infructuous for the decree
appealed from is superseded by a new decree

RULES OF REVIEW UNDER XLVII OF CPC

RULE 1: review proceedings are not by way of an appeal and have to be strictly confined to the
scope

RULE 4: No application for review, however, shall be granted without previous notice to the
opposite party to appear and oppose the application. It shall also not be granted on the ground of
discovery of new matter or evidence which the applicant alleges was not within his knowledge at the
time of the passing of the decree or order, without strict proof of such allegation.

Rule 6: Where the application for a review is heard by more than one judge and the court is
equally divided, the application shall be rejected. Where there is a majority, the decision shall be
according to the opinion of the majority.

Rule 7: An order of the court rejecting the application for review shall not be appealable, but an
order granting the application may be objected to at once by an appeal from the order granting the
application or in any appeal from the decree or order finally passed or made in the suit.

In case the application has been rejected on failure of the applicant to appear, the court may restore
the rejected application to the file on being satisfied that the applicant was prevented by sufficient
cause from appearing upon such terms as to costs or otherwise as it thinks fit.

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 Rule 9: No application to review an order made on an application for a review or a decree or order
passed or made on a review shall be entertained.

REVISION: Section 115 of CPC

The section reads as follows:

(1) The High Court may call for the record of any case which hasbeen decided by any court subordinate to such
High Court and in which no appeal lies thereto, and if such subordinate court appears-

(a) To have exercised a jurisdiction not vested in it by law, or

(b) To have failed to exercise a jurisdiction so vested, or

(c) To have acted in the exercise of its jurisdiction illegality or with material irregularity,

the High Court may make such order in the case as it thinks fit:

Provided that the High Court shall not, underthis section, varyorreverse anyordermade, oranyorderdeciding
an issue, in the course of a suitor otherproceeding, except where the order, if it had been madein favour of the
party applying for revision, would have finally disposed of the suit or other proceedings.

(2) The High Court shall not, under this section, vary or reverse any decree or order against which an appeal
lies either to the High Court or to any court subordinate thereto.

(3) A revision shall not operate as a stay of suit or other proceeding before the Court except where such
suit or other proceeding is stayed by the High Court.

The power of the High Court under Section 115 is exercisable in respect of ‘any case which has been
decided’. The word “case” is something wider but not wide enough to include every order passed
by a court during the pendency of a suit. It would include a decision on any substantial question in
controversy between the parties affecting their rights, even though such order is passed in the
course of the trial of the suit.

APPLICABILITY OF CIVIL PROCEDURE CODE ON TRIBUNALS

The applicability of the Code of Civil Procedure (CPC) to tribunals is restricted and varies based on the
specific legislation governing each tribunal. There is no blanket rule for all tribunals; rather, the
provisions of the CPC are applied selectively as per the governing statutes and rules of each tribunal.

National Company Law Tribunal (NCLT)

1. Rule 57 of NCLT Rules: CPC applies for issuing processes for execution of NCLT orders.
2. Rule 126 of NCLT Rules: Affidavits filed before NCLT must comply with Order XIX, Rule 3 of
CPC.
3. Rule 131 of NCLT Rules: Discovery, production, and return of documents are governed by CPC,
unless specified otherwise.
4. Rule 135 of NCLT Rules: Summoning and examination of witnesses follow the provisions of
Orders XVI and XXVI of the CPC.

Securities and Exchange Board of India (SEBI)

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 • Section 11(3) of the SEBI Act, 1992: SEBI, when exercising specific powers, has the same
powers as a civil court under the CPC, including the discovery and production of documents,
summoning witnesses, and issuing commissions.

Securities Appellate Tribunal (SAT)

• Section 15U of the SEBI Act, 1992: SAT is not bound by the CPC but follows principles of
natural justice. However, SAT has powers equivalent to a civil court under the CPC, such as
summoning and examining witnesses, requiring documents, receiving evidence on affidavits,
and issuing commissions.

Court Ruling

• In Shri G.S. Rathore vs The Union of India (2007), the Bombay High Court ruled that the CPC
should not be applied strictly to tribunals. The core principle is that administrative procedures
before tribunals must adhere to natural justice, and CPC provisions apply only when explicitly
stated in the tribunal's governing legislation.

In summary, the CPC applies to tribunals in a limited and context-specific manner, primarily focusing
on procedural aspects such as document production, summoning of witnesses, and execution of
orders, but the principles of natural justice remain paramount.

CS Somya Kataria
 UNIT 10
Pleadings

SOMYA KATARIA (CS, MBA): 9131993373

SOMYA KATARIA (CS, MBA): 9131993373

1. What is pleading?
“Pleading” shall mean ‘plaint’ or ‘written statement’.

“Pleadings are statements, written, drawn up and

filed by each party to a case, stating what his contentions will be at the trial and
giving all such details as his opponent needs to know in order to prepare his case
in answer” words ‘plaints’ and ‘complaints’ are nearly synonymous. In both, the
expression of grievance is predominant.

• OBJECT OF PLEADING

1. to give a fair notice to each party of what the opponent’s case is.
2. The facts admitted by any parties need not be pursued or proved.
3. The parties come to know beforehand what points the opposite party will raise at the trial, and thus they are
prepared to meet them and are not taken by surprise, which would certainly be the case if there were no
obligatory rules of pleadings whereby the parties are compelled to lay bare there cases before the opposite
party prior to the commencement of the actual trial.

SOMYA KATARIA (CS, MBA):

 4 The object of the pleadings is three-fold. They are
a) to define the issues involved between the parties;
b) to provide an opportunity to the opposite party or other side to met up the particular allegation raised
against him or her, and

c) to enable the Court to adjudicate the real issue involved between the parties

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SOMYA KATARIA (CS, MBA):

2. Fundamental Rules of Pleading:

I. Facts and not Law:

• The duty of the pleader is to set out the facts upon which he relies and not the legal inferences to be
drawn from them.

• A judge is bound to apply the correct law and draw correct legal inferences and facts, even if the party
has been foolish to make a written statement about the law applicable of those facts.

• If a plaintiff asserts a right in him without showing on what facts his claim of right is funded or asserts
that defendant is indebted to him or owes him a duty without alleging the facts out of which
indebtedness or duty arises, his pleading is bad.

• Declaratory suit

• money suit

• matrimonial petition

• Negligence and damages

SOMYA KATARIA (CS, MBA):

 • Omission to State the facts

• suit for recovery of money for the goods sold

The rule that every pleading must state facts and not law is subject to the following exceptions:

i. Foreign Law

ii. Customs

iii. Mixed question of law and fact

iv. Legal Pleas

v. Inferences of law.

II. Material Facts:

What is necessary therefore are the facts which are material; facts which have a direct and immediate
bearing on the case, facts which are secondary or incidental may easily be omitted.

This rule is embodied in Order VI Rule 2 and it requires that –

I. The party pleading must plead all material facts on which he intends to rely for his claim or
defence as the case may be; and

SOMYA KATARIA (CS, MBA): 9131993373

 II. He must plead material facts only, and that no fact which is not material should be pleaded, nor
should the party plead evidence, nor the law of which a Court may take a judicial notice.

Exception to the General Rules:

i. Condition Precedent: “Any condition Precedent, the performance or occurrence of which is intended to be
contested, shall be distinctly specified in his pleading by the plaintiff or defendant, as the case may be; and,
subject thereto, an averment of the performance or occurrence of all conditions precedent necessary for the
case of the plaintiff or defendant shall be implied in his pleading.”

ii. Presumption of Law: Order VI Rule 13, C.P.C., provides that neither party need in any pleading allege any
matter of fact which the law presumes in his favour or as to which the burden of proof lies upon the other side
unless the same has first been specifically denied.

iii. Matters of Inducement: Another exception to the general rule is regarding facts which are merely
introductory. Such facts only state the names of the parties, their relationships, their professions and such
circumstances as are necessary to inform the court as to how the dispute has arisen.

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Rule III: Facts not Evidence:

Material facts are those facts which a plaintiff must allege in order to show a right to sue or a defendant must
allege in order to constitute his defence. Evidence also consists of facts and in order to distinguish between the
two kinds of facts, the material facts on which the party pleading relies for his claim or defence are called facta
probanda and the facts by means of which they (i.e. material facts) are be proved are called facta probantia.

a)Facta probanda: The facts which are to be proved. These are the facts on which a party relies and are ought
to be stated in the pleading.

b)Facta probantia: These are the facts which are not to be stated because by their means facta probanda are
proved. Thus these facts are the evidence as to the existence of certain facts on which the party relies for his
cause of action or defiance as the case may be. Facta probanda are not facts in issue, but they are relevant in
that at the trial their proof will establish the existence of facts in issue. No doubt in certain cases both the facts
in issue and there facts in evidence are mixed up and are almost indistinguishable.

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IV: Facts to be stated concisely and precisely:
This rule is that the material rule is that the material facts should be stated in the pleading in a concise form but
with precision and certainty, the pleading shall be divided into paragraphs, numbered consecutively. Dates, sums
and numbers shall be expressed in figure. What this rule means is that the pleading should be brief and to the
point. There should be no obscurity or Vagueness.

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3. PLAINT:
The plaint shall contain the following particulars:

a) The name of the Court in which the suit is brought;

b) The name, description and place of residence of the plaintiff;

c) The name, description and place of residence of the defendant, so far as they can be ascertained;

d) Where the plaintiff or the defendant is a minor or a person of unsound mind, a statement to that effect;

e) The facts constituting the cause of action and when it arose;

f) The facts showing that the Court has jurisdiction;

g) The relief which the plaintiff claims;

h) Where the plaintiff has allowed a set-off or relinquished a portion of his claim the amount so allowed or
relinquished; and

i) A statement of the value of the subject-matter of the suit for the purposes of jurisdiction and of court fees,
so far as the case admits.

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Civil Pleadings Under the Code of Civil Procedure (CPC)
The Code of Civil Procedure (CPC) is procedural law, meaning it does not create or remove rights but governs how civil matters are
handled in courts.
1. Classes of Civil Courts
Civil courts are structured hierarchically:
•Higher Courts: Supreme Court and High Courts.
•District Level: The highest is the District Judge’s Court, followed by Additional District Judges.
•Lower Civil Courts: These are categorized based on:
•Territorial Limits: Jurisdiction over specific areas.
•Pecuniary Limits: Based on monetary value of disputes:
•Civil Judge (Senior Division)
•Civil Judge (Junior Division)
•Small Cause Court
2. Money Suits
•When suing for money, the exact amount must be stated in the plaint.
•If the amount is uncertain (e.g., mesne profits, unsettled accounts, movables), an approximate estimate should be provided.
2A. Interest Claims
•If interest is claimed, the plaint must include:
•Whether it relates to a commercial transaction (per Section 34 of CPC, 1908).
•If based on contract, statute, or another basis, it should be specified.
•Details such as rate, start and end dates, total amount, and daily accrual must be mentioned.
3. Suits Involving Immovable Property
•The property must be described clearly, with boundaries or survey numbers if available.
4. Representative Suits
•If a plaintiff sues as a representative, the plaint must confirm:
•Their interest in the subject matter.
•That all necessary steps for such a suit have SOMYA KATARIA (CS, MBA):
been taken.
Dilatory Pleas
•These delay the trial but do not address the case’s merits (e.g., inadequate court fees).
•Such objections must be raised at the earliest opportunity.
Interlocutory Applications
•Interlocutory orders are temporary rulings made before final case disposal.
•Governed by Section 94 of CPC and related Orders/Rules in Schedule I.
•Examples include:
• Appointment of a Commissioner
• Temporary Injunctions
• Receivership
• Payment into court
• Security for costs
Distinction Between Incidental & Supplemental Proceedings
•Incidental Proceedings: Arise directly from the main case.
•Supplemental Proceedings: Support the suit but do not determine its final outcome.
•Case Law: Rashtriya Ispat Nigam Ltd. v. Verma Transport Company (AIR 2006 SC 2800)
and Vareed Jacob v. Sosamma Geevarghese (AIR 2004 SC 3992) clarify these
distinctions.
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 4. WRITTEN STATEMENT
1) The written statement must specifically deal with each allegation of fact in the plaint and when a defendant denies
any fact, he must not do so evasively but answer the same in substance.
2) The written statement must specifically deal with each allegation of fact in the plaint and when a defendant denies
any fact, he must not do so evasively but answer the same in substance.
3) Before proceeding to draft a written statement, it is always necessary for a pleader to examine the plaint very
carefully and to see whether all the particulars are given in it and whether the whole information that he requires
for fully understanding the claim and drawing up the defence is available.
4) If any particulars are wanting, he should apply that the plaintiff be required to furnish them before the defendant
files his written statement.
5) If he cannot make a proper defence without going through such particulars and/ or such documents referred to in
the plaint, and that the defendant is not in possession of such copies, or the copies do not serve the required
purpose, the defendant should call upon the plaintiff to grant him inspection of them and to permit him to take
copies, if necessary, or, if he thinks necessary, he may apply for discovery of documents.
6) If there are several defendants, they may file a joint defence, if they have the same defence to the claim. If their
defences are different, they should file separate written statements, and if the defences are not only different but
also conflicting, it is not proper for the same pleader to file the different written statements.

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 5. TYPES OF DEFENCES
• Denials:

• Dilatory pleas

• Objections to point of law

• Special defence (confession and

avoidance):

• Special defence (confession and

avoidance):

Notice:The concept of "notice" lacks a general law defining its essential elements, recipients, and method of service. However, many
legal provisions require that affected parties be given notice before final decisions are made. Litigation often arises concerning notice,
particularly under Section 3 and Section 106 of the Transfer of Property Act, 1882.
Notices fall into two categories:
1.Individual Notices: Given before taking action affecting another party, such as terminating a lease under Section 106 of the
Transfer of Property Act or issuing a notice to the government under Section 80 of the CPC before filing a suit. The objective of
Section 80 CPC is to prevent unnecessary litigation by allowing the government or public officers to address grievances before a
lawsuit is initiated.
2.Legal Notices in Specific Cases: These may be required under various laws where notice must be served before initiating legal
action.
For a notice under Section 106 of the Transfer of Property Act, key requirements include:
•It must be in writing.
•It should be signed by the sender or their authorized agent.
•It must clearly state the termination of the tenancy from a specific date.
The fundamental purpose of notice laws is to ensure fairness, prevent unnecessary litigation, and provide an opportunity for dispute
SOMYA KATARIA (CS, MBA):
resolution before legal proceedings commence.
6. INTERLOCUTORY ORDERS:

Interlocutory” means not that decides the cause but which only settles some intervening matter relating to
the cause.

After the suit is instituted by the plaintiff and before it is finally disposed off, the court may make
interlocutory
orders as may appear to the court to be just and convenient.

The power to grant Interlocutory orders can be traced to Section 94 of C.P.C. Section 94 summarizes
general powers of a civil court in regard to different types of Interlocutory orders. It provides for
supplemental proceedings.

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7. EXECUTION OF PETITION
Application for execution of a decree may be either (1) Oral; or (2) written.

1. Oral Application: Where a decree is for payment of money the court may on the oral application of the
decree holder at the time of the passing of the decree, order immediate execution thereof by the arrest
of the judgement debtor, prior to the preparation of a warrant if he is within precincts of the court.

2. Written Application: Every application for the execution of a decree shall be in writing save as
otherwise provided sub-rule (1) signed and verified by the applicant or by some other person proved to
the satisfaction of the court to be acquinted with the facts of the case.

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8. TYPES OF APPEALS
1. Appeals from original decrees may be preferred from every decree passed by any Court exercising
original jurisdiction to the Court authorised to hear appeals from the decisions of such Court on points of
law as well as on facts.
2. Second Appeals lie to the High Court from every decree passed in appeal by any Court subordinate to
the High Court, if the High Court is satisfied that the case Appeals from, Orders under Sections 104 to
106 would lie only from the
3. following Orders on grounds of defect or irregularity of law:

• An Order under Section 35A of the Code allowing special costs;

• An Order under Section 91 or Section 92 refusing leave to institute a suit; involves a substantial
question of law.

• An Order under Section 95 for compensation for obtaining arrest, attachment or injunction on
insufficient ground;

• An Order under the Code imposing a fine or directing the detention or arrest of any person except
in execution of a decree;

4. Appeals to the Supreme Court

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9. REVISION
Section 115 of the Code of Civil Procedure, 1908 provides for the remedy of revision. In a case where an
appeal does not lie against a final order the aggrieved party can file a revision before the High Court (an no
other court).

The High Court may call for the record of any case which has been decided by any Court subordinate to such
High Court and in which no appeal lies thereto, and if such sub-ordinate Court appears:

a. to have exercised a jurisdiction not vested in it by law; or

b. to have failed to exercise a jurisdiction so vested; or
c. to have acted in the exercise of its jurisdiction illegally or with material irregularity, the High Court may
make such order in the case as it thinks fit:

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Step 6: Format of the Report
•The report should be addressed to the appointing authority unless otherwise specified.
•The report should be detailed, following prescribed formats if applicable.
•If necessary, annexes should be used for information not included in the report body.
•The signature block must include the auditor's details, and the report's date and location of signing should be clearly mentioned, especially if signed by
different individuals.
WRITS
The Constitution also confers power on the High Courts to issue certain writs. Article 226 of the Constitution lays down :
“Notwithstanding anything in Article 32, every High Court shall have power, throughout the territories in relation to which it exercises
jurisdiction, to issue to any person or authority, including in appropriate cases, any Government, within those territories, directions,
orders or writs, including writs in the nature of habeas corpus, mandamus, prohibition, quo warranto and certiorari, or any of them, for
the enforcement of any of the rights conferred by Part III (Fundamental Rights) and for any other purpose”.

Types of Writs
As mentioned in Articles 32 and 226 of the Constitution, writs are in the nature of habeas corpus, mandamus, prohibition, quo warranto and
certiorari. A brief discussion of each is as follows:
Habeas Corpus : The writ of habeas corpus is a remedy available to a person who is confined without legal justification. The words “Habeas Corpus” literally
mean “to have a body”. This is an order to let the Court know on what ground he has been confined and to set him free if there is no legal justification for
his detention. This writ has to be obeyed by the detaining authority by production of the person before the Court. Under Articles 32 and 226 of the
Constitution, any person may move the Supreme Court and the High Court of competent jurisdiction respectively, for the issue of this writ. The applicant
may be the prisoner himself moving the Court or any other person may move the Court on his behalf to secure his liberty praying for the issue of the writ of
habeas corpus. No person can be punished or deprived of his personal liberty except for violation of any law and in accordance with the due process of law.
Dis-obedience to the writ of habeas corpus attracts punishment for contempt of Court under the Contempt of Courts Act, 1971.
Mandamus: The expression “mandamus” means a command. The writ of mandamus is, thus, a command issued to direct any person, corporation, inferior
Court or Government authority requiring him to do a particular thing therein specified which pertains to his or their office and is further in the nature of a
public duty. This writ is used when the inferior tribunal has declined to exercise jurisdiction. Mandamus can be issued against any public authority. The
applicant must have a legal right to the performance of a legal duty by the person against whom the writ is prayed. Mandamus is not issued if the public
authority has a discretion.
SOMYA KATARIA (CS, MBA):
• Mandamus can be issued by the Supreme Court and all the High Courts to all authorities. However, it does not lie against the President of India
or the Governor of a State for the exercise of their duties and powers (Article 360). It also does not lie against a private individual or body
except where the State is in collusion with such private party in the matter of contravention of any provision of the Constitution or of a Statute.
It is a discretionary remedy and the Court may refuse if alternative remedy exists except in case of infringement of Fundamental Rights.

• Prohibition : The writ of prohibition is issued by the Supreme Court or any High Court to an inferior Court preventing the latter from usurping
jurisdiction which is not legally vested in it. It compels courts to act within their jurisdiction when a tribunal acts without or in excess of
jurisdiction or in violation of rules or law.

• The writ of prohibition is available only against judicial or quasi-judicial authorities and is not available against a public officer who is not vested
with judicial functions. If abuse of power is apparent this writ may be prayed for as a matter of right and not a matter of discretion. The
Supreme Court may issue this writ only in case of Fundamental Rights being affected by reason of the jurisdictional defect in the proceedings.
This writ is available during the pendancy of the proceedings and before the order is made.

• Certiorari : The writ of certiorari is available to any person whenever any body of persons having legal authority to determine questions
affecting the rights of subjects and having the duty to act judicially, acts in excess of its legal authority. The writ removes the proceedings from
such body to the High Court in order to quash a decision that goes beyond the jurisdiction of the deciding authority.

• Quo warranto : The writ of quo warranto is prayed, for an inquiry into the legality of the claim which a person asserts to an office or franchise
and to oust him from such position if he is an usurper. The holder of the office has to show to the Court under what authority he holds the
office. This writ is issued when:
• (i) the office is of a public and of a substantive nature;
• (ii) the office is created by a Statute or by the Constitution itself; and
• (iii) the respondent must have asserted his claim to the office. It can issue even though he has not assumed charge of the office.
• The fundamental basis of the proceedings of quo warranto is that the public has an interest to see that no un authorised person
usurps a public office. It is a discretionary remedy which the Court may grant or refuse. When an applicant challenges the validity
of an appointment to a public office, it is maintainable whether or not any fundamental or other legal right of such person has
been infringed. This writ is intended to safeguard SOMYA KATARIA
against (CS, MBA):
the usurpation of public offices.
Affidavit

An affidavit is a sworn written statement made under oath before an authorized officer. Courts may allow
facts to be proven by affidavit but can require the deponent to appear for cross-examination. Affidavits
must comply with Order XIX, Rule 1 of the Code of Civil Procedure, 1908, specifying which portions
are based on personal knowledge and which are based on information, along with the source.
Key rules for drafting an affidavit include:
1.Only essential allegations should be included.
2.The deponent must be fully described.
3.It should be in the first person.
4.Paragraphs should be numbered and structured clearly.
5.People and places mentioned must be clearly identified.
6.Personal knowledge must be stated directly with “I affirm” or “I make oath and say.”
7.If information is based on another source, it must be acknowledged with “I am informed by so and so”
and, if believed to be true, “and I believe it to be true.”
8.Sources of documents referred to must be disclosed.
9.The affidavit must end with an oath or affirmation stating that it is true and conceals nothing.
10.Any alterations must be authenticated by the attesting officer.
Affidavits are drawn on non-judicial stamp paper (as per state rules) and sworn before an Oath
Commissioner, Notary Public, Magistrate, or other authorized officials. Stamp duty applies under
Article 4, Schedule I, Stamp Act, 1899, except for affidavits filed in court, which are subject to a court
fee instead. SOMYA KATARIA (CS, MBA):
Preliminary Submissions:
These should focus on presenting true and undisclosed facts relevant to the issue and legal objections based on applicable laws.
Lawyers must be well-versed in legal provisions and precedents to ensure their submissions are upheld. If a claim is legally barred
(e.g., due to limitation), this should be raised with supporting legal references and case law.
Arguments on Merits:
These involve facts pleaded by the parties and supporting evidence (both oral and documentary). Lawyers should highlight
contradictions in the opponent’s pleadings and evidence, such as the absence of proof for a contract or failure to provide
documentary proof of notice service. Additionally, inconsistencies revealed in cross-examinations should be emphasized to
strengthen the argument.
Legal Pleadings and Submissions
Legal Pleadings/Written Submissions
•Legal pleadings should be categorized under "preliminary submissions/objections" and must be based on clear and directly
applicable legal provisions.
•Example: If an unregistered contract is the basis of a claim and requires mandatory registration under Section 17 of the
Registration Act, the court cannot consider it as evidence.
•Other legal objections that challenge the validity of a suit include:
•Lack of statutory notice
•No cause of action
•No right to sue
•Res judicata (case already decided)
•Waiver, estoppel, or acquiescence
•Barred by special enactment
•Lack of jurisdiction
•Limitation period expired
•Premature filing of the suit

SOMYA KATARIA (CS, MBA):

These objections, also known as special defenses, help defendants avoid liability even if they admit to the facts of the case.
Witnesses in Pleadings
•Not defined in the Code of Civil Procedure, 1908 (CPC) but usually in the form of affidavits.
•An affidavit is a sworn written statement before an authorized official.
•Governed by Order 19 of CPC, it must:
•Contain only facts, not conclusions.
•Be signed by the deponent (person making the statement).
•Be attested by a Notary or Oath Commissioner, not by a Chartered Accountant, Company Secretary, or Cost
Accountant.
•Notarization ensures the authenticity of signatures and prevents fraud.
Improper Admissions in Pleadings
•While "improper admissions" is not defined in CPC, admission is any statement made by a party that supports a fact in issue.
•Order XII Rule 6 CPC: Allows courts to pass a judgment on admissions, but it is discretionary, not mandatory.
•Order XII Rule 1 & 2:
•A party may admit or refuse to admit a case/document through written notice.
•If a party does not respond within 7 days, the document is deemed admitted, and the refusing party bears the cost of
proving it.
•Order XII Rule 3A & 4:
•Courts can call a party to admit or deny documents.
•Admissions in one case cannot be used in another case.
•Case Law: Karan Kapoor v. Madhuri Kumar (2022)
•The Supreme Court ruled that judgment on admission is only valid when the admission is clear, unambiguous, and
categorical.
•Since the admissions in this case were unclear, the Trial Court's decision was set aside.
SOMYA KATARIA (CS, MBA):
 Agar shuru karne ki himmat thi toh...

Khatam karne se kyu Ghabre rahe ho?

SOMYA KATARIA (CS, MBA):

 Drafting
APPEARANCES AND ART OF ADVOCACY

Somya Kataria (CS,MBA)

 AFFIDAVITIN EVIDENCE
◦ The following must be kept in mind while preparing the affidavit-in-evidence by the parties –
◦ (i) The best evidence is that of a person who was personally involved in the whole transaction. In case, that person is not
available for any reason, then any other person who has joined in his place to make deposition by way of his affidavit.
◦ (i) Incase, the petitioner himself was involved in the execution of a contract, he should file affidavit-inevidence.
◦ ( i) The allegations or charges or grounds relating to facts should be re-produced duly supported by documentary evidence.
It may be noted that in the affidavit in evidence, the position of law or legal provisions or principle of law are not reproduced
because the position of law or settled principles of law are not required to be proved by any party and they are deemed to
exist and any party can argue and take help of those settled position of law while arguing their case before the Court or
Tribunal or Forum and need to be proved by filing an evidence. [Section 5, Indian Evidence Act.]
◦ (iv) In case, the point or issue pertains to engineering, medical, technology, science or other complex or difficult issues, then
the evidence of expert is to be filed in the form of his Affidavit. If necessary, the said witness has to appear before the Forum
for the purpose of cross-examination by the counsel for the other party. For example, hand-writing or finger print experts etc.
◦ (v) Besides the leading evidence on the points raised by the petitioner or by the opposite party in his written statement/reply,
if possible, the party who is filing the affidavit-in-evidence should also file documents, papers or books or registers to demolish
the defence or case set up by the opposite party.
◦ (vi) It is also permissible for any party to bring any outside witness (other than the expert witness) in support of his case if the
facts and circumstances of the case so warrant and permitted by the Court/ Tribunal.
◦ (vii) At the time of tendering affidavit-in-evidence, the party must bring alongwith it either the original of papers, documents,
books, registers relied upon by it or bring with it the carbon copy of the same. It may be noted that only photocopy of any
paper or document (in the absence of its reply, original or carbon copy) can not be relied upon and tendered as an
evidSoemnyacKeata.ria (CS, MBA)
◦ 1. Argument on preliminary submissions: Preliminary submissions should primarily confine to the true and
correct facts regarding the issue involved and which have been suppressed or not disclosed by the other
side in the pleadings. Thus, for eg., if a claim being opposed by a lawyer/authorized representative is
evidently barred by limitation, such an objection should be taken in the preliminary submissions/objections.
◦ 2. Argument on merits: Suchargumentsasrelatetothefactspleadedbythepartiesaretermedasargumentson
merits.Whileaddressing arguments on merits, a lawyer/authorized representative should carefully point out
the pleadings of the parties and the relevant evidence in support thereof, lead by the parties, both oral as
well as documentary. INSTANCES Thus, where an agreement/contract of service is pleaded and there is
no evidence either oral or documentary on record in support of such an agreement/contract, it should be
specifically pointed out.
◦ 3. Rule of adverse inference: Itisincumbent upon a party in possession of best evidence on the issue
involved,to produce such evidence and if such party failsto produce the same, an adverse inference is
liable to be drawn againstsuch party. The Court will be justified in drawing an adverse inference
againstthat party

Somya Kataria (CS,MBA)

Points to draft written pleadings
◦ – Quote relevant provisions in the petition and excerpts of observations made by the Courts relevant to
the point;
◦ – Draft prayers for interimrelief in such a manner which though appears to be innocuous but satisfy your
requirements;

◦ – Do not suppressfa cts;

◦ – Highlight material facts, legal provisionsand Court decisions, if any;
◦ – State important points at the outset together with reference to relevant provisions/judgements

Somya Kataria (CS,MBA)

 Points to draft Oral pleadings
◦ – Preparation before presentation of the case¬
◦ ;– Carefully read your petition, provisions of law and judgements;
◦ – Jot down relevant points on a separate sheet of paper together with relevant pages of the compilation;
◦ – Keep copies of judgements to be relied ready for the Court and for your opponent(s).

◦ WHILEPRESENTING YOURCASE
◦ Refer to the order sought to be challenged or reliefs sought to be prayed;
◦ – State brief facts;
◦ –Formulate issues/points, categorise them and address them one by one;
◦ – Take each point, state relevant facts, provisions of law and relevant binding decisions;
◦ –Hand over xerox copies of binding decisions to the Court Master while placing reliance;
◦ – Refer to relevant pages of the compilation, provisions of law and judgements;
◦ – Complete all points slowly but firmly;

Somya Kataria (CS,MBA)

ADVOCACY TIPS
◦ (i) Clarity: The judge’s time islimited, so make the most of it.
◦ (i) Credibility: The judge needsto believe that what you are saying istrue and that you are on the rightside.
◦ ( i) Demeanour: We don’t have a phrase “hearing isbelieving”. The human animal which includes the human
judge, isfar more video than audio. The way we collect most of our information isthrough our eyesight.

◦ (iv) Eye contact: While pleading, maintain eye contact with your judge.
◦ (v) Voicemodulation:Voicemodulationisequally important.Modulating your voice allows youtoemphasize
thepoints youwanttoemphasize.Be very carefulabout raising your voice. Use your anger strategically.But use is
rarely. Always be in control of it.

◦ (vi) Psychology: Understand judge’s psychology as your job is to make the judge prefer your version of the truth.
◦ (vi) Be likeable. At least be more likeable than your opponent. Ifyou can convert an unfamiliar Bench into a
group of people who are sympathetic to you personally, you perform a wonderful service to your client.

◦ (v i) Learn to listen. (ix) Entertain your judge. Humour will often bail you out of a tough spot

Somya Kataria (CS,MBA)

As Regards Advocacy
◦ Advocacy involves presenting logical facts in the right perspective to differentiate between right and wrong using
legal knowledge. Company Secretaries must formulate and present persuasive submissions based on facts,
principles, and legal authority. Effective advocacy requires thorough preparation, case presentation skills, and
client confidence. Key skills include identifying client goals, analyzing facts and legal contexts, structuring cases
clearly, outlining strengths and weaknesses, and developing a strong presentation strategy.

◦ IMPORTANT PRINCIPLES OF ADVOCACY

◦ Some of the important principles of advocacy a Company Secretary should observe include:
◦ 1. Act in the best interest of the client;
◦ 2. Act in accordance with the client’s wishes and instructions;
◦ 3. Keep the client properly informed;
◦ 4. Carry out instructions with diligence and competence;
◦ 5. Act impartially and offer frank, independent advice;
◦ 6. Maintain client confidentiality.
◦ 7. Keep a track of the status of the case and take follow up whenever necessary. This can ensure the timely
completion of the case.
◦ 8. Understand the requirements of the procedure before the tribunal.

Somya Kataria (CS,MBA)

Rule of Adverse Inference

The Rule of Adverse Inference states that no evidence is needed for formally
admitted matters in civil and criminal cases. If a party fails to present the best
available evidence, the court can draw an adverse inference against them. In
complex cases requiring expert knowledge (e.g., medical, engineering,
technology), expert opinions or authoritative publications are necessary, as courts
cannot act as experts.
Additionally, understanding tribunal jurisdiction is crucial for legal
professionals, as filing in the wrong tribunal wastes time and damages professional
credibility. A well-prepared approach/plan helps professionals handle cases
effectively, ensuring a strategic and structured approach.
Dressing etiquettes

Somya Kataria (CS,MBA)

Somya Kataria (CS,MBA)
HANDSHAKE ETIQUETTES

Somya Kataria (CS,MBA)

COMMUNIC ATION ETIQUETTES

Somya Kataria (CS,MBA)

Dining Etiquettes

Somya Kataria (CS,MBA)

Unit 12 adjudication under companies act
Saturday, 20 April 2024 9:11 PM
CH: 14
RIGHTTO LEGAL REPRESENTATION

Somya Kataria (CS,MBA)

Real Estate (Regulation and
Development) Act, 2016
◦ A PCS can appear before Adjudicating officer or appeallate tribunal:
◦ Hence a Company Secretary holding certificate of practice can –
◦ Represent a person (promoter) before any real estate regulatory authority for registration of real estate
project,

◦ Represent a person before real estate appellate tribunal.

◦ Represent a person before Adjudic ating Offic er

Somya Kataria (CS,MBA)

 National Company Law Appellate
Tribunal (NCLAT)
1. National Company Law Tribunal (NCLT) & National Company Law Appellate Tribunal (NCLAT)
•NCLT: Established under Section 408 of the Companies Act, 2013, with a President, Judicial Members, and
Technical Members to handle company law matters.
•NCLAT: Established under Section 410, with a Chairperson, Judicial Members, and Technical Members to
hear appeals against orders of NCLT and decisions of the National Financial Reporting Authority (NFRA).
•Location: Principal Bench in New Delhi, with sittings in other locations.
2. Appeals Process
•Section 421: Appeals against NCLT orders must be filed with NCLAT within 45 days, extendable by another 45
days for sufficient cause.
•Section 423: Appeals against NCLAT orders can be filed with the Supreme Court within 60 days, extendable
by another 60 days if justified.
•NCLAT has the power to confirm, modify, or set aside NCLT orders.
3. Regional Director (RD) & Registrar of Companies (RoC)
•RD: Appointed by the Central Government, supervises RoCs, and hears appeals against their decisions.
•RoC: Registers companies and ensures compliance with the Companies Act, functioning as a public record office.
4. Company Law Board (CLB)
•Previously the Appellate Authority under the Companies Act, 1956.
•Dissolved, and its functions transferred to NCLT & NCLAT under the Companies Act, 2013.
Conclusion
The Companies Act, 2013, establishes NCLAT as the main appellate authority for company law matters, along
with Regional Directors handling appeals against RoC decisions. Compliance with the Act and legal guidance are
crucial for protecting corporate rights.
APPEARANCE UNDER THE RESERVE
BANK OF INDIA ACT, 1934
Company Secretaries may be required to appear before the Reserve Bank of India (RBI) for regulatory
compliance matters under The Reserve Bank of India Act, 1934. Their role involves ensuring compliance,
facilitating communication, and representing the organization effectively. Key considerations include:
1.Understanding the Provisions – Familiarize with relevant sections of the Act to grasp responsibilities.
2.Preparing Relevant Information – Gather necessary documents like financial statements and compliance
reports.
3.Consulting Internal Stakeholders – Engage senior management, legal teams, and compliance
departments.
4.Engaging Legal Counsel (if needed) – Seek legal guidance for complex matters.
5.Preparation for Appearance – Anticipate questions, understand compliance status, and be ready with
responses.
6.Maintaining Professionalism – Dress appropriately, be punctual, and communicate clearly.
7.Complying with RBI’s Instructions – Follow RBI’s guidelines, provide requested information, and meet
deadlines.
8.Facilitating Communication – Ensure accurate and relevant information is conveyed effectively.
9.Keeping Records – Maintain documentation of discussions, decisions, and directives.
10.Follow-up and Compliance – Implement any corrective actions or additional requests from the RBI.
Since procedures may vary based on circumstances, close collaboration with internal teams and legal advisors is
crucial for ensuring compliance and successful representation before the RBI.
APPELLATE AUTHORITIES UNDER THE
INCOME-TAX ACT, 1961

The Income Tax Act, 1961 provides appellate authorities to review tax assessments and
orders, ensuring fairness and protecting taxpayers' rights. The appellate hierarchy includes:
1.Commissioner of Income Tax (Appeals) [CIT(A)] – The first appellate authority, reviewing
orders of the Assessing Officer (AO) and having the power to confirm, modify, or set aside
decisions.
2.Income Tax Appellate Tribunal (ITAT) – The second appellate authority, an independent
judicial body hearing appeals against CIT(A)'s orders.
3.High Court – Hears appeals on legal questions arising from ITAT orders.
4.Supreme Court of India – The highest appellate authority, deciding appeals on legal
issues from High Court rulings.
These authorities ensure the fair implementation of tax laws and provide taxpayers with a
structured mechanism to challenge assessments.
 Agar shuru karne ki himmat thi toh...

Khatam karne se kyu Ghabre rahe ho?

SOMYA KATARIA (CS,

MBA): 9131993373