1)Overview of Limited Liability PartnershipLLP Act, 2008 passed by Lok Sabha on 12th of December 2008 and the President gave assent to the Bill on 7th January 2009. LLP Rules, 2009 Notified on 01st of April 2009. Constituent of LLP Act, 2008 81 Section 4 Schedules 29 Forms Out of 81 Sections, 75 Sections were so far Notified (Except provisions on Winding up and dissolution). Out of Four Schedules, Schedule 1 defines the Mutual Rights and Liabilities of the Partner, in the absence of any matter in LLP Agreement and other schedules prescribes provisions relating to conversion What is Limited Liability Partnership? Hybrid of Corporate & Partnership business Form. Limits liability of partners to the extent of their contribution. provides flexibility without imposing detailed (and costly) legal and procedural requirements. The organization and operations are on the basis of an mutual agreement. Features of LLP 1)Body corporate 2)Separate legal identity 3)Perpetual succession 4)Limited liability of partners 5)Only with profit motive 6)Non applicability of partnership act Benefits as Compared to Partnership Firm Ω Unlimited No. of Partners Ω Limited Liability of Partners Ω LLP is liable to the extent of assets. Ω No Liability of a partner for the wrongful act of other partner. Ω No exposure to the personal assets of partners except in case of fraud. Benefits as Compared to Corporate Form Ω Easy to Form, Run and manage. Ω Internal structure and governance through mutual agreement. Ω No Minimum Contribution Ω Less Government Intervention Ω Less requirement as to maintenance of statutory records Ω Less Compliances Ω Taxation (Income Tax) of LLP will be like general partnership. Ω No wealth Tax. LLP Act-New Features Mandatory imprisonment with penalty for false statement, fraud and non- compliance of order of Tribunal/CLB/Court [(Section-11(3),37,30,73)]. Un-limited Liability of Partners and LLP in event of business are carried out with intent of defraud its creditors or third parties (Sec-30). Waiver of penalties and protection against future vindictive action to whistle blowers (Sec-31). LLP is liable to third party to the extent of credit received by it or any financial benefit derived on falsely holding out of a person as partner of LLP (Sec-29). Central Govt. by Notification may apply/extend any provisions of Companies Act, 1956 (With or without modifications) to LLPs. Partners & Designated Partners Any Individual or/and body corporate may be partner. (A foreigner can be partner of a LLP in India). Body Corporate means company as defined under section 3 of the companies Act, 1956 and includes a)Limited liability partnership registered under LLP Act b)Limited Liability Partnership incorporated outside India and c)Company incorporated outside India Designated partner : a) Every LLP shall have at least two designated partners who are individuals and at least one of them shall be resident in India. b) Responsible for managing the day to day affairs and ensuring the compliances of all applicable laws. Requirements for Designated Partners : 1) Designated Partner identification Number (DPIN) 2) Only Individual can be the Designated Partners. 3) At least One Designated partner should be resident of India. 4) In case of Body corporate their nominees can be the Designated Partners. Contribution Each partner shall bring contribution in LLP and nature & amount shall be disclosed in the Accounts of LLP. Contribution can be in tangible, movable, immovable or intangible Form. In case of “tangible/Intangible (other than cash) Form of contribution” or “contribution by way of service contract” it shall be valued by a practicing Chartered Accountant/Cost Accountant/Approved Valuer. Role /rights of partners 1)Right to participate in Management 2)For Business Purposes Agent of Limited Liability Partnership, not of other Partners. 3)Ethical duty to comply with all provisions of LLP Act and LLP Agreement Limited to the Extent of their Contribution Not Liable for the wrongful Acts /Omissions of other Partners Not Liable for Obligation of LLP arising out of a contract Unlimited Liability of Partners in case of Fraud Formation of LLP I - Deciding the Partners & Designated partners II - Obtaining DPIN (Form-7) & Digital Signature III - Reservation of Name for LLP (Form-1) IV - Filing of Incorporation Document (Form-2) V - Certificate of Incorporation VI – Filing of LLP Agreement (Form-3) VII – Filing of Consent of partners/Designated partners (Form-4) I - Parameters for deciding the Partners and Designated Partners: At least 2 Partners - Individuals or Body Corporate Minimum Two Designated Partners out of total no. of Partners – Individuals or Nominee of Body Corporate. At least One Designated Partner to be Resident of India. II - Obtaining DPIN (Form-7) & Digital Signature DPIN – Designated Partner Identification Number DPIN - 8 digit Numeric Number DPIN vs DIN Online application in Form 7 to Central Government Submission of the physical application along with Identity and Address Proof of applicant. III - Reservation of Name for LLP (Form-1) The word ‘LLP’ or ‘Limited Liability partnership’ shall be the last word of name. Not to be identical or too nearly resembles to any other partnership firm, LLP, Body Corporate and trade mark. (Section-15) Not to be Prohibited under Emblems ‘Emblems and Names (Prevention of Improper use) Act, 1950 and Rule-18. If business includes banking, stock exchange, NBFCs activities, chit funds, micro finance (offering small loans/contribution from public, collective investment scheme, a copy of in principle approval of appropriate authority to be obtained. e Form 1 to be filed with ROC. IV - Filing of Incorporation Document (Form-2) e Form 2 – Incorporation Document along with Subscription Sheet and proof of address of registered office of LLP. Total incorporation fees V - Certificate of Incorporation On Successful Compliances – Registrar Issues Certificate of Incorporation. Conclusive Evidence of Registration of Limited Liability Partnership VI – Filing of LLP Agreement (Form-3) Execution of LLP Agreement is mandatory (Section-23). In absence of Agreement as to any matter, Schedule 1 will be applicable. Filing of details of LLP Agreement through e Form 3 – within 30 days of Incorporation. Stamp duty on LLP agreement to be paid as per State Stamp Act. Under Income Tax, interest paid and remuneration or commission paid to partners will be allowed as deduction if payment is authorized by written LLP Agreement. Features of schedule 1 1. All partners entitled to share equally in the Capital and Profits/losses. 2. Indemnity to the partners on personal liability in proper conduct of business. 3. Every Partner shall take part in management 4. No partner shall be entitled to remuneration. 5. No partner introduced without consent of all partners. 6. All decisions with majority of partners consent 7. Minutes to be recorded within 30 days 8. Render True Accounts 9. All Disputes will be referred to Arbitration Act Regular Compliances of LLP Maintenance of proper Books of Accounts on cash basis or on accrual basis and according to the Double Entry System of Accounting. 4. Form-11 (Filing of Annual Return) – within 60 Days of closure of Financial Year Conversion of LLP Who can convert? Partnership firm Private company Unlisted public company Procedure of Conversion of Company/Firm to LLP VII . Form-25 is to be filed with the fees of Rs. All the Members of the Company/partners of the firm shall be the Partners in LLP (and no one else) with the same capital/contribution ratio. Foreign LLP [LLP Incorporated Outside India (LIOI)] Section 59 of LLP Act.Rs. 8. Form-8 (Filing of Statements of Accounts & Solvency) – Within 30 days from the end of 6 months from the closure of Financial Year. Statement of Assets and Liabilities certified by Auditor of not more than 30 days prior to the date of the conversion application. 7.10.000/-. Form-17/18 & Form-2 (with mandatory attachments) 2.Obtaining DPIN & Digital Signature I .5.Certificate of Conversion into LLP (Form 19) V . All due returns of ROC. Filing fees for Form-27 . After receiving Conversion Certificate the same to be filed within 15 days with the Registrar of Companies in Form 14 . NOC from other authority for conversion. Filing of Form with registrar of LLP:a. If the business is regulated by special Act. Reservation/Renewal of Name by Foreign LLP/Foreign Company Foreign LLP/Foreign Company can reserve its existing name by which it is registered in the Foreign Country. if required. 9.Filing of Incorporation Document (Form-2) III – Reservation of Name for LLP (Form-1) II . No security interest on the assets shall be subsisting or in force on the date of application. 2008 contain provisions regarding establishment of the place of business by Foreign Limited Liability Partnership within the India for carrying on their business.Intimation of Conversion to ROC (Form 14) VI . Filing of Form-27 within 30 days from establishment of place of business in India. Audit of Accounts in accordance with the Rules prescribed.000/ Reservation of name valid for 3 years. Income Tax and other Tax authorities shall be filed. Compromise & Arrangement . Renewal of name is possible by filing fresh From-25 on payment of fees Rs. 5. Maintained at registered office and preserved for at least 8 years. Form-7 & Form1 and b.Filing of Conversion Application (Form 17/18) IV.Deciding the Partners & Designated Partners Important Considerations for conversion LLP 1. Consent of all Members of the Company/partners of the firm shall be obtained.5000/ Compliance of special Act. Permission/approval of Reserve Bank of India (RBI) required for establishment of place of business in India. 6. NOC from Unsecured creditors. 3. 11. 2) Negotiable instrument ACT• The law relating to negotiable instruments is the law of commercial world which was enacted to facilitate the activities in trade and commerce. No Surcharge will be levied on income tax. 5. 4. Taxation benefits as compare to company. . Bills of exchange and Cheques. Till the time tribunal is constituted application will be made to High Court.f assessment year 2010-11. 1881. More flexibility than company. 3. Limited Liability of partners. Allows Multi-disciplinary professionals combination which provides level playing field against their international professional firm. 10. 7. In case of LLP is under winding up.e. Availability of solvency position in public domain increases the credit worthiness. Separate legal entity & body corporate. 6. 2009) Profit will be taxed in hand of the LLP and not in the hands of Partners w. 8. Remuneration to partners will be taxed as their “income from business & profession”. • The act applies to the whole of India and to all persons resident in India. • It deals with Promissory notes. Tribunal orders for meeting of creditors or partners for decision/resolution by 3/4th in value of creditors or partners agreeing to any compromise or arrangement. Winding up of LLP Alike Companies. the trade and commerce activities were adversely affected as it was not practicable for the trading community to carry currency in bulk. LLP is liable to the extent of its assets. Venture capital funds can combined with knowledge and expertise. whether foreigners or Indians. Tribunal may order sanctioning a compromise or an arrangement. No Minimum Alternate Tax and dividend distribution tax No Capital gain on conversion of partnership firm into LLP Designated partners will liable to sign and file Income Tax return Merits of LLP (as business model for SMEs and service providers) 1. 9. the application can be made by the liquidator. LLP may be wound up either Voluntary or by the Order of Tribunal. 2. The Rules for winding up is yet to be notified by C.G Taxation LLP (as per the Finance Act. Easy to exit/ winding up. • The law in India relating to negotiable instruments is contained in the Negotiable Instruments Act.LLP Partners Creditors Application is to be made to Tribunal by LLP or creditor or partners for compromise or arrangements. Right of partners can be assigned to third party. • In the absence of such instruments. Low compliance burden & cost. debentures payable to bearer and dividend warrants are negotiable instruments.” Meaning A negotiable instrument is a written and signed document entitling a person to a sum of money specified in it and transferable from one person to another person either by mere delivery or by endorsement and delivery. and be entitled to recover the money of the instrument in his own name. etc. Characteristics of a Negotiable Instrument 1) Written instrument with signature 2) Easy negotiability 3) Transferee can sue in his own name without giving notice to the debtor 4) Better title to a bonafide transferee for value 5) Prompt payment 6) Presumptions Presumptions of Negotiable Instrument Sections 118 and 119 of the Negotiable Instrument Act lay down certain presumptions which the court presumes in regard to negotiable instruments. Thus negotiable instrument literally means “A written document transferable by delivery”. 2. But the money orders and postal orders. 1) Consideration 2) Date 3) Time of acceptance 4) Time of transfer 5) Order of endorsement 6) Stamp 7) Holder in due course 8) Proof of protest Conditions of negotiability Although the Act mentions only three instruments (such as a promissory note. “A negotiable instrument means a promissory note. share certificates. yet they are not able to give better title to the bonafide transferee for value than what the transferor has Promissory Notes According to section 4 of the Act. . bill of exchange or cheque payable either to order or to bearer. The person who obtains it in good faith and for value should get it free from all defects. Documents like share warrants payable to bearer. The instrument should be freely transferable (by delivery or by endorsement and delivery) by the custom of trade. deposit receipts. dock warrant. Definition According to Section 13 of the Negotiable Instruments Act 1881. it does not exclude the possibility of adding any other instrument which satisfies the following two conditions of negotiability: 1. bill of lading. a bill of exchange and cheque). are not negotiable instruments.Negotiable instrument Negotiable means “transferable by delivery”. Although they are transferable by delivery and endorsements. Instrument means “a written document by which a right is created in favour of some person”. written by the creditor and accepted by the debtor. 7. Bill of exchange Section 5 of the Act defines. Difference between Promissory note and Bill of Exchange 1. but no such notice need be given in the case of a note. 3. The person to whom the payment is made is called the ‘payee’. There are usually three parties to a bill of exchange drawer. due notice of dishonour is to be given by the holder to the drawer and the intermediate indorsers. The instrument must be signed by the maker 6. before it can be presented for payment. drawee and payee must be certain. there are three parties. • It must be signed by the drawer. The promise to pay must be unconditional. to pay a certain sum of money to or to the order of a certain person. there is an unconditional order to the drawee to pay according to the direction of the drawer. It must be in writing 2. although any two out of the three may be filled by one and the same person.” The person who makes the promise is called the ‘maker’. while in a bill of exchange the drawer and payee may be same person. or to the bearer of the instrument. The person to whom the promise is made must be a definite person 7. 6. “A bill of exchange is an instrument in writing containing an unconditional order. 8. 4. Payment to the maker: A promissory note cannot be made payable to the maker himself. 5. whereas in a bill of exchange. A bill of exchange. signed by the maker. Payable to bearer: A promissory note cannot be drawn “payable to bearer” while bill of exchange can be so drawn provided it is not drawn “payable to bearer on demand”. or to the order of a certain person or to the bearer of the instrument”. Unconditional promise: A promissory note contains an unconditional promise by the maker to pay to the payee or his order. Number of parties: In a promissory note there are only two parties – the maker (debtor) and the payee (creditor). acceptor or drawee and payee. Note: No person in India other than RBI or the Central Government can make or issue a promissory note payable to the bearer of the instrument. Notice of dishonour: When a bill is dishonoured. Prior acceptance: A note is presented for payment without any prior acceptance by the maker. It must contain a promise or undertaking to pay 3. Essentials of a bill of exchange • It must be in writing. The amount promised must be certain and a definite sum of money 5.“A promissory note is an instrument in writing (note being a bank-note or a currency note) containing an unconditional undertaking. Drawer himself may be the payee. directing a certain person to pay a certain sum of money only to. . • It should be properly stamped. Relation: The maker of the promissory note stands in immediate relation with the payee. • There must be an order to pay. therefore. is a written acknowledgement of the debt. Primary or absolute liability: The liability of the maker of a promissory note is primary and absolute. Characteristics of a Promissory Note 1. 2. • The drawer. but the liability of the drawer of a bill of exchange is secondary and conditional. In a bill of exchange. • The sum payable must also be certain. drawer. The amount payable must be in legal tender money of India. signed by the maker. A bill of exchange is payable after sight must be accepted by the drawee or someone else on his behalf. drawee and payee. 4. • It must contain an express order to pay money and money alone. while the maker or drawer of an accepted bill stands in immediate relations with the acceptor and not the payee. A stranger cannot endorse it. while a cheque is always drawn on a bank. 2. the writing of one’s name on the back of the instrument or any paper attached to it with the intention of transferring the rights therein. 3) The drawer and the payee may be one and the same person in both the instruments. Essentials of a valid endorsement 1. 5) Both must contain an unconditional order to pay a certain sum of money. The person who effects an endorsement is called an ‘endorser’. writing on the back of an instrument. drawee and the payee. but no such notice is necessary in the case of cheque. but not needed in the case of bill. or on the expiry of a certain period after date. Unlike cheques. Thumb-impression should be attested. A cheque is a bill of exchange with two distinctive features namely: (1) It is always drawn on a bank. 4. Notice of dishonour of a bill is necessary. A cheque may be crossed. Thus. Full name is not essential. a bill may be also drawn payable on demand. The drawer of the bill is discharged from his liability. The endorsement may be on the back or face of the instrument and if no space is left on the instrument. 4) Both must be written and signed.Cheque Section 6 of the Act defines “A cheque is a bill of exchange drawn on a specified banker. Endorsement The word ‘endorsement’ in its literal sense means. It must be on the instrument. the drawer. A cheque can only be drawn payable on demand. and the person to whom negotiable instrument is transferred by endorsement is called the ‘endorsee’. and not expressed to be payable otherwise than on demand and it includes the electronic image of a truncated cheque and a cheque in the electronic form”. 6) Both may be endorsed. It must be signed by the endorser. 3. Signature may be made on any part of the instrument. endorsement is signing a negotiable instrument for the purpose of negotiation. Difference between cheque and bill of exchange A bill of exchange is usually drawn on some person or firm. It is essential that a bill of exchange must be accepted before its payment can be claimed. while a cheque does not require any stamp. it may be made on a separate paper attached to it called allonage. but the drawer of a cheque is discharged only if he suffers any damage by delay in presenting the cheque for payment. But under the Negotiable Instruments Act it means. A grace of three days is allowed in the case of time bills while no grace is given in the case of a cheque. It should usually be in ink. the payment of a bill cannot be countermanded by the drawer. It may be made either by the endorser merely signing his name on the instrument (it is a blank endorsement) or by any words showing an intention to endorse or transfer the instrument to a specified . A rubber stamp is not accepted but the designation of the holder can be done by a rubber stamp. A cheque does not require any such acceptance. A bill of exchange must be properly stamped. A cheque drawn to bearer payable on demand shall be valid but a bill payable on demand can never be drawn to bearer. It must be made by the maker or holder of the instrument. and (2) It is always payable on demand Similarities between cheque and bill of exchange 1) Both are bills of exchange 2) Both have three parties. if it is not presented for payment. Initials may suffice. Special or full endorsement (Section 16) When the endorsement contains not only the signature of the endorser but also the name of the person in whose favour the endorsement is made. The maker or the drawer cannot endorse the instrument but if any of them has become the holder thereof he may endorse the instrument. then it is an endorsement in full. 6. It simply consists of the signature of the endorser on the endorsement. 3. A payee or endorsee cannot endorse or negotiate unless he is the holder there of. 51).1000. Endorsement in blank specifies no endorsee. It must be completed by delivery of the instrument. He endorses it “pay to B or order Rs. The maker or drawer cannot endorse or negotiate an instrument unless he is in lawful possession of instrument or is the holder there of. The endorsee under a restrictive endorsement acquires all the rights of the endorser except the right of negotiation. It must be an endorsement of the entire bill. A partial endorsement i. Thereafter the instrument may be endorsed by any person who has become the holder of the instrument. when endorsement is made by writing the words “Pay to A or A’s order. In such an endorsement. the latter gets no right on the instrument. Classes of endorsement An endorsement may be: (1) Blank or general (2) Special or full (3) Partial (4) Restrictive (5) Conditional 1. Who may endorse? The payee of an instrument is the rightful person to make the first endorsement.Hybrid of Corporate & Partnership business Form.” “Pay C for my use.” followed by the signature of the endorser. Example: A is the holder of a bill for Rs. Blank or general endorsement (Sections 16 & 54) It is an endorsement when the endorser merely signs on the instrument without mentioning the name of the person in whose favour the endorsement is made. Such an endorsement does not operate as a negotiation of the instrument. 4. No specific form of words is prescribed for an endorsement. But intention to transfer must be present.e. 3) What is Limited Liability Partnership? Limited liability Partnership (LLP) .500. A negotiable instrument even though payable to order becomes a bearer instrument if endorsed in blank.” “Pay C for the account of B” are instances of restrictive endorsement. it is only the endorsee who can transfer the instrument. which purports to transfer to the endorse a part only of the amount payable does not operate as a valid endorsement. Restrictive endorsement is one which either by express words restricts or prohibits the further negotiation of a bill or which expresses that it is not a complete and unconditional transfer of the instrument but is a mere authority to the endorsee to deal with bill as directed by such endorsement. it is an endorsement in full. Partial endorsement (Section 56) A partial endorsement is one which purports to transfer to the endorsee a part only of the amount payable on the instrument. 5. The delivery must be made by the endorser himself or by somebody on his behalf with the intention of passing property therein. Then it is transferable by mere delivery. Thus. Thus. (Sec.” This is a partial endorsement and invalid for the purpose of negotiation. where a person endorses an instrument to another and keeps it in his papers where it is found after his death and then delivered to the endorsee. . “Pay C.person (it is an endorsement in full). 2. Restrictive endorsement (Section 50) The endorsement of an instrument may contain terms making it restrictive. Allows the benefits of limited liability with the flexibility of organizing the internal structure as a partnership based on mutually agreed Agreement Gateway for Multi Disciplinary Professionals LLP Requirements of LLP Contribution Minimum 2 Partners Minimum 2 Designated Partners Designated Partner Identification Number LLP Name LLP Agreement Registered Office Management of LLP Partners designated partners Shareholders directors Who can be partner? 1)Individual & or 2)Body corporate “Body Corporate” Includes Limited liability partnership registered under LLP Act Limited liability partnership incorporated outside India and Company incorporated outside India. Since a partner need not to be resident in India except a designated Partner who should be resident in India Role of Partner Right to participate in Management For Business Purposes Agent of Limited Liability Partnership. not of other Partners Ethical duty to comply with all provisions of LLP Act and LLP Agreement Liability of Partners Limited to the Extent of their Contribution Not Liable for the wrongful Acts /Omissions of other Partners Not Liable for Obligation of LLP arising out of a contract Unlimited Liability of relevant Partners in case of Fraud. Designated Partners “Designated partner” means any partner designated as such pursuant to Section 7 of Limited Liability Partnership Act 2008 . Even all the Foreigners can form a LLP in India. Requirement for Designated Partners Designated Partner Identification Number Only Individual can be the Designated Partners At least One designated Partner should be resident in India In case of Body Corporate their nominees can be the Designated Partners Benefits as Compared to Corporate Form Ω Easy to Form Ω Easy to Run & Manage Ω Low cost of Formation Ω No Minimum Contribution Ω No Stamp Duty as on date . Responsible for managing the day to day affairs and ensuring the compliances of all applicable laws. The maximum time limit in which the Forms can be filed along with Penalty is 300 Days thereafter prosecution will be initiated. In case of Non Filing of Annul Return & Statement of Account & Solvency for Consecutive five years the LLP may be wind up.Ω Less Government Intervention Ω Less requirement as to maintenance of statutory records Ω Less Compliances Ω No Minimum Alternate Tax as on Date Benefits as Compared to Partnership Form Ω Unlimited No. LLP may be wound up either Voluntary or by the Order of Tribunal. 2008 contain provisions regarding Foreign Limited Liability Partnership but Central Government has not specified any rules for Foreign Direct Investment in India through LLP. Brand Reservation. Less No. of Compliances. Regular Compliances of LLP Filing of Statements of Accounts & Solvency – Within 6 months of closure of Financial Year.Rs. Foreign LLP Section 59 of LLP Act. Alike worldwide LLPs. of Partners Ω Limited Liability of Partners Ω No Liability for the wrongful act of other Partner. Tax Liability of LLP Indian Government. Under some cases. The Act does not provides any provision for raising of money from Public via public issue. Winding up of LLP Alike Companies. Invest in India without being present in India. 3000 for a month where as in case of Company with a capital of Rs. . 100 per day . 200 for Non –Filing up to 30 days . Benefit For Foreigners 1. liability may extend to personal assets of Partners. Ministry of Finance has not yet specified any regulatory framework for taxing LLPs. 2. Lot of formalities on closure of Business. 3.Section 35(1) Penalty for Non –Filing will be Rs. an option may be there to tax the income either in the hands of the LLP or in the hands of the Partners. Ω Less exposure to personal assets of the partners Drawback of LLP Any act of the Partner without the other may bind the LLP. 1 lakh penalty will be only Rs. Section34(2) Filing of Annual Return – with in 60 Days of closure of Financial Year . g. 2. circulars. Right to Information Is it possible to Customize our governance? Yes!! If people actively participate in the democratic process . Law making. or certified copies of documents or records Taking certified samples of material Obtaining information in the form of diskettes. Projects. papers. . contracts.18. documents. 4. or Govt. samples. extracts. Governance will improve Information means Information includes records. It is possible only when people are aware of the process of decision making. data held in electronic form. RTI was used to detect and punish the guilty b. RTI Act fulfills the ambitions by disclosure of information mandatory. Bodies. log-books. 25. records Taking notes.2005 for foreign trips.'s between 1987-2000 (II) Chief Minister spent Rs.4) Right to Information Act . press releases. eg. Policy Decision. orders. but it helps the one who fights for good governance 2)To participate in governance for successful democracy such as: Election.2005 Introduction 1)What is Right to information? – A Fundamental Right How Does it help us? It may not help you directly to get what you want e. Schemes. 772 between 2001. documents.Can public participate? 1. Also includes information relating to any private body which can be accessed by a public authority. tapes. memos. floppies. e-mails. Ensuring Free Education for children in Gujarat where Private Trust school was collecting fee not permissible by law. reports.g. gas. To be a part of decision making in the Govt. 600 for foreign trips of M.Equal treatment before law Article 19 : Right to Freedom-freedom of Speech and Expression Article 21 : Protection of Life & Personal Liberty RIGHT TO INFORMATION PARADIGM SHIFT An act which will be implemented by the people and acted upon by the government Basic Tenets Disclosure a rule and Secrecy an exception Transparency means public interest Public Interest overrides It is a part of Global Process. video cassettes or in any other electronic mode or through printouts where such information is stored in a computer or in any other device. To make govt. a. Exposing of mass expenditure of W. makes information accessible to general public. How disclosure helps ? Delhi based NGO under RIT has obtained that Public Works Dept.. 60. Right to information means Inspection of work. advises. (I) Rs. If Govt. transparent and public servants answerable? Constitutional Base Article 14 : Right to Equality. Right to information Official Secrets Act 1923 had made disclosure of information punishable. models. opinions. Bengal Govt. has cooked up a/c e.P.electricity connection. 15 and 16). Barbers in Raj Bhavan 4. o Parents may seek details of grants made to government-aided schools to ensure that funds are being spent properly.M 360 Crores in 2008. circulars. samples. The daily attendance of teachers in govt. Now the whole contract is being investigated. . In one contract 29 hand pumps were installed on paper. 2005 (120th day of its enactment on 15th June. 3. or can check that admissions are not being bought through bribes or that funds meant to education are not being diverted for other purposes. 2.Non-applicability of the Act to Intelligence and Security Organizations (S.27 and 28). opinions. What does information mean? “Information means any material in any form including records. .Obligations of public authorities [S. o Owners of small businesses may find out the basis on which licenses and/or tax concession and subsidies are granted by govt. Some provisions have come into force with immediate effect viz. [S. including which officers have handled the file.1. memos. People can check on the progress of their applications for govt. Right to Information Act – 2005 1. models. The Court has directed for investigation. hospital and for what reasons or what the shortfall of doctors and nurses in compared with sanctioned staff. Who is covered? The Act extends to the whole of India except the State of Jammu and Kashmir. eg. papers. emails. services. logbooks. 2. contracts.24) . reports.Constitution of Central information Commission (S. Out of 253 gratings only 30 were installed. How often inspectors visit factories and other manufacturing units to check that they are not illegally releasing hazardous materials into the environment. By checking the status of an application for an electricity or water connection. press releases. 2005).(12)] 3. How many contractors have been blacklisted by the municipal authorities and of the blacklisted how many have been given contracts for executing public works. schools. o Unemployed people may ask about the criteria for giving government jobs or the status of their application and position in the waitlist. but actually only 14 pumps were installed.Designation of Public Information Officers and Assistant Public Information Officers[S. over what period of time and what action was taken. constitution of State Information Commission (S. advices.Power to make rules to carry out the provisions of the Act (S. Right to information What can be done? o People holding ration cards can check the stocks and sales registers held by dealers and the food dept. orders. documents. When did it come into force? It comes into force on the 12th October. you may want to find out information about issues of public importance and try to gent the government to address problems. is granting licenses/ concessions/ subsidies on the basis of properly applied criteria. For example.12 and 13). How many people are being housed in local jails compared with the sanctioned capacity of the jail. Right to information As a community-minded person.4( 1)]. you can find out: How many deaths have occurred in a govt. . Security cost of P. to make sure that they are getting their proper amount of rations and that rations are not being siphoned off in their name.5(1) . data . the names.2(t)]. tapes.2(h)] -by or under the Constitution. to render reasonable assistance to the person to reduce the same in writing.body owned. within 5 days. designations and other particulars of the Public . . the PIO shall transfer. . What are the obligations of Public Authority? 4(1) b It shall publish within one hundred and twenty days of the enactment:a.2005 1.9. g. Information Officers. i. documents. on receipt of a request. The particulars of facilities available to citizens for obtaining information. shall render all assistance and for the purpose of contraventions of the provisions of this Act. PIO. The particulars of its organization. The budget allocated to each of its agency. Ii. if maintained for public use. either provide the information on payment of such fee as may be prescribed or reject the request for any of the reasons specified in S. diskettes. 3.. and includes any. A directory of its officers and employees. The powers and duties .[S.PIOs are officers designated by the public authorities in all administrative units or offices under it to provide information to the citizens requesting for information under the Act. The procedure followed in its decision making process.Any officer. J.material held in any electronic form and information relating to any private body which can be accessed by a public authority under any other law for the time being in force”. Expenditures and reports on disbursements h.2005 If the information requested for is held by another public authority. The norms set by it for the discharge of its functions. -by any other law made by Parliament. manner of execution of subsidy programmes. PIO may seek the assistance of any other officer for the proper discharge of his /her duties. extracts or certified copies of documents or records. including the amounts allocated and the details of the information available to. c.8 or S. [S. inspect works. 4. Where the information requested for concerns the life or liberty of a person. including the system of compensation as provided. video cassettes or in any other electronic mode or through printouts. iii. such other officer shall be treated as a PIO. Right to Information Act . shall within 30 days of the receipt of the request.[S. 4. What does a "public authority" mean? Any authority or body or institution of self government established or constituted: [S. including the working hours of a library or reading room. whose assistance has been sought by the PIO for the proper discharge of his or her duties. Who are Public Information Officers (PIOs)? . or held by it. a statement of the categories of the documents held . -by notification issued or order made by the appropriate Govt.the monthly remuneration received by each of its officers and employees. obtain information in form of printouts. take notes. d. What are the duties of a PIO? PIO shall deal with requests from persons seeking information and where the request cannot be made in writing. f. What does Right to Information mean? It includes the right to I. -by any other law made by State Legislature. b.2G)] Right to Information Act . take certified samples of material. controlled or substantially financed non-Government organization substantially financed directly or indirectly by the appropriate Government. . the request to that other public authority and inform the applicant immediately. e. records. the same shall be provided within forty-eight hours. iv. floppies.4(l )(b)] 2. functions and duties. What is the time limit to get the information? 1. unless the competent authority is satisfied that larger public interest warrants the disclosure of such information.per application . the security. to the PIO. PIO shall provide information in the form in which it is sought unless it would disproportionately divert the resources of the Public Authority or would be detrimental to the safety or preservation of the record in question. Apply in writing or through electronic means in English or Hindi or in the official language of the area. If the PIO fails to give decision on the request within the period specified. the PIO shall give a written notice to the third party within 5 days from the receipt of the request and take its representation into consideration . scientific or economic interests of the State. 30 days from the date of application . and (iii) the particulars of the Appellate Authority. In respect of public authorities other than those covered above – Rs.. the disclosure of which would harm the competitive position of a third party. Reason for seeking information are not required to be given. Pay fees as may be prescribed (if not belonging to the below poverty line category). information available to a person in his fiduciary relationship~ unless the competent authority is satisfied that the larger public interest warrants the disclosure of such information. 5/. Where a request has been rejected. IV. the PIO shall communicate to the requester . In respect of public authorities at Mandal Level – Rs. directory of officers and employees. relation with foreign State or lead to incitement of an offence II. strategic.(i) the reasons for such rejection. which would prejudicially affect the sovereignty and integrity of India. What is not open to disclosure? ( 8 categories) The following is exempt from disclosure [S. Information which would cause a breach of privilege of Parliament or the State Legislature. Third party must be given a chance to make a representation before the PIO within 10 days from the date of receipt of such notice. which facilitates the right to information Shall also publish the information of the organization regarding structure. Right to Information Act – 2005 Procedure for Request of Information (Detailed) 1. Procedure for obtaining information : Every person seeking the information shall request orally or in writing or through electronic means paying the requisite fees at the following rates : In respect of public authorities at the Village Level – No fee . 10/. 2.per application . decision making process. specifying the particulars of the information sought for. (ii) the period within which an appeal against such rejection may be preferred. names and designations of public information officers etc. 3. he shall be deemed to have refused the request. trade secrets or intellectual property. procedure followed. Right to information act 2005 Third Party Information If information sought has been supplied by third party or is treated as confidential by that third party. What is the Application Procedure for requesting information? 1. III. Information including commercial confidence. Information. Information expressly forbidden to be published by any court of law or tribunal or the disclosure of which may constitute contempt of court.8)] I. Right to Information Act – 2005 1. Obligations of Public Authorities Every public authority shall maintain all its records duly catalogued and indexed in a manner and form. 2. 3. Floppy. What could be the ground for rejection? 1. 3. 48 hours for information concerning the life or liberty of a person 3.44 MB. Applicant can seek review of the decision on fees charged by the PIa by applying to the appropriate Appellate Authority. 2. Applicant must be provided information free of cost if the PIO fails to comply with the prescribed time limit.2/. Other offices may be established in other parts of the country with the approval of the Central Government. in case the application for information is given to Assistant Public Information Officer.2005 How is Central Information Commission constituted? 1. If the interests of a third party are involved then time limit will be 40 days (maximum period + time given to the party to make representation). No fees will be charged from people living below the poverty line 4. models or material in any other form.per each page per copy. CDs. 4. 2. floppies.2. 1. . vii) Material to be sent by post – the actual postal charges in addition to the charge payable as per the rules. Commission will exercise its powers without being subjected to directions by any other authority. What is the fee? Application fees to be prescribed which must be reasonable. and (c) Rupees two hundred for CD (DVD). samples. Samples and models – actual cost thereof. then the same must be intimated in writing with calculation details of how the figure was arrived at. If it is covered by exemption from disclosure.12) The sale price of publications printed matter.8) 2. Disposal of Request : The Central Public Information Officer or State Public Information Officer within 30 days either provide information or reject with reasons and the period within which appeal can be preferred and particulars of the appellate authority. text. plans. and a fee of rupees five for each fifteen minutes (or fraction thereof) thereafter. 5 days shall be added to the above response time. Information in Electronic format viz. maps. The applicant is not required to give any reason or any other personal details except those that may be necessary for contacting him. (S. Commission includes I Chief Information Commissioner (CIC) and not more than 10 Information Commissioners (IC) who will be appointed by the President of India. 5. Commission shall have its Headquarters in Delhi. 4. Oath of Office will be administered by the President of India according to the form set Out in the First Schedule. 5. vi) Inspection of records – no fee for the first hour.actual cost thereof.9) Right to Information Act . 4. Material in printed or text form in larger than A4 or A3 size paper . Maps and plans – actual cost thereof. (b) Rupees one hundred for CD of 700 MB. e) Other than priced material : i) Material in printed or text form (in A4 or A3 size paper) Rs. If it infringes copyright of any person other than the State.. (S. (S. CD or DVD: (a) Rupees fifty for Floppy of 1. If further fees are required. Failure to provide information within the specified period is a deemed refusal. Central Information Commission to be constituted by the Central Government through a Gazette Notification. 3. which if properly implemented will bring the rule of law into governance. VI) Information which would impede the process of investigation or apprehension or prosecution of offenders. The respective Government cause a copy of such report to be laid before each House of Parliament and State Legislature as the case may be. If the information sought for concerns the life and liberty of a person. What information is not available? V) Information. Penalties provided under the Act : Require the public authority to compensate the complainant for any loss or other detriment suffered. shall prepare a report on the implementation of the Act at the end of every year and forwarded it to the appropriate Government. Secretaries and other officers. The Penal provisions are the real teeth of the Act.each day not exceeding Rs. VII)Cabinet papers including records of deliberations of the Council of Ministers. Also recommend for disciplinary actions against Central Public Information Officer or State Public Information Officer under Service Rules applicable to them. disclosure may be allowed if the public interest in disclosure outweighs in importance any possible harm or injury to the interest of such third party. Except. Periodical evaluation & Monitoring & Annual report. in case of trade or commercial secrets protected by law. Exemption clause in detail National security Trade secrete/IPR/copy right Privacy Foreign relation Danger to life & physical safety Impede the investigation Cabinet papers Public interest v/s protected interests Monitoring Quantitative and qualitative – devise formats Trainings and workshops Consultation and review Involve Civil society Responsive government Continuous improvement by issue of guidelines.250/.till application is received or information furnished. . he shall be invited to know whether the information should be disclosed. which would endanger the life or physical safety of any person or identify the source of information or assistance given in confidence for law enforcement or security purposes. The burden proving that he acted reasonably or diligently is on the Central Public Information Officer or State Public Information Officer.25. Monitoring and Reporting: The Central Information Commission or State Information Commission as the case may be. the same shall be provided within (48) hours of the receipt of request. Disposal of Information of Third Party : A Central Public Information Officer or State Public Information Officer intends to disclose any information which relates to a third party and treated as confidential by that third party. 000/. Impose a penalty of Rs. Assam Rifles. requiring the discovery and inspection of documents. providing access to information in a particular form. Lakshadweep Police. information relating to allegations of human rights valuations could be given but only with the approval of the Central or State Information Commission. Who is excluded? Central Intelligence and Security agencies specified in the Second Schedule like IB. The exclusion. NSG. c. (S. compelling them to give oral or written evidence on oath and to produce documents or things. may be provided. CRPF. Aviation Research Centre. or which would cause unwarranted invasion of the privacy of the individual. 2. e. Directorate of Revenue Intelligence. require it to compensate for any loss or other detriment suffered by the applicant.and any other matter relating to obtaining information under this law. Power to secure compliance of its decisions from the Public Authority includesa. CIC/SCIC will have powers of Civil Court such asa. summoning and enforcing attendance of persons. as the case may be. directing the public authority to appoint a PIO/ APIO where none exists. Is partial disclosure allowed? Only that part of the record which does not contain any information which is exempt from disclosure and which can reasonably be severed from any part that contains exempt information. g. All records covered by this law (including those covered by exemptions) must be given to CIC/SCIC during inquiry for examination. receiving evidence on affidavit.VIII)Information which relates to personal information the disclosure of which has no relationship to any public activity or interest. 1.Directorate of Enforcement. enhancing training provision for officials on RTI. 5. Narcotics Control Bureau. Agencies specified by the State Governments through a Notification will also be excluded. if public interest in disclosure outweighs the harm to the protected interests. The Crime Branch-CID-CB.Special Frontier Force. Power to order inquiry if there are reasonable grounds. Notwithstanding any of the exemptions listed above. making necessary changes to the practices relating to management.10] 3. [S.Who thinks information given is incomplete or false or misleading . however.Dadra and Nagar Haveli and Special Branch. reject the application. Andaman and Nicobar. impose penalties under this law.19) 5)Dishonour of negotiable instruments . f. or h.18 and S. b) who has been refused information that was requested. is not absolute and these organizations have an obligation to provide information pertaining to allegations of corruption and human rights violations. Further. 3. a public authority may allow access to information.2005 2. Right to Information Act . requisitioning public records or copies from any court or office issuing summons for examination of witnesses or documents any other matter which may be prescribed. ITBP. d) who thinks the fees charged are unreasonable. seeking an annual report from the public authority on compliance with this law. [S. BSF. Central Economic Intelligence Bureau. R&A W. b. d. b. publishing information or categories of information. CISF.24)] Right to Information Act – 2005 What are the powers and functions of Information Commissions? The Central Information Commission/State Information Commission has a duty to receive complaints from any person a) who has not been able to submit an information request because a PIa has not been appointed. 4. Special Branch (CID). c) who has received no response to his/her information request within the specified time limits . c. Special Service Bureau. maintenance and destruction of records . Noting should specify in the instrument. When there are several drawees even if one of them makes a default in acceptance. If a bill is presented to the drawee for acceptance and he does not accept it within 48 hours from the time of presentment for acceptance. Still it has some advantages. • Cheques do not require noting and protesting. if any (d) the notary’s charges. 6. 5. If noting is done within a reasonable time protest may be drawn later on. Non-payment As presentment for acceptance is required only in case of bills of exchange. The holder may need an authentic evidence of the fact that a negotiable instrument has been dishonoured. the bill is treated as dishonoured. the bill is taken to a notary public who represents it for acceptance or payment as the case may be and if the drawee or acceptor still refuses to accept or pay the bill. 4. Noting As soon as a bill of exchange or a promissory note is dishonoured.e the drawer and the indorsers after he has given a notice of dishonour to them. (e) a reference to the notary’s register and (f) the notary’s initials. When the drawee is incompetent to contract. When a cheque is dishonoured generally the bank who refuses payment returns back the cheque giving reasons in writing for the dishonour of the cheque. it is only the bills of exchange which may be dishonoured by non-acceptance. Facts about noting • Noting should be made by the notary within a reasonable time after dishonour. the bill is noted as stated above. the holder can after giving the parties due notice of dishonor. When presentment for acceptance is excused and the bill is not accepted.A negotiable instrument may be dishonored by 1. Section 99 provides a mode of authenticating the fact of the bill having been dishonoured. Dishonour by Non-acceptance A bill of exchange is said to be dishonoured by non-acceptance in the following cases: 1. but when the drawees are partners acceptance by one of them means acceptance by all. Non-acceptance 2. (b) the date of dishonour. 3. (c) the reason for such dishonour. Noting and Protesting When a negotiable instrument is dishonoured the holder may sue his prior parties i. Noting by itself has no legal effect. Ordinarily when there are a number of drawees all of them must accept the same. When a bill is accepted with a qualified acceptance. the holder may treat the bill of exchange having been dishonoured. Sections 99 and l00 provide convenient methods of authenticating the fact of dishonour of a bill of exchange and a promissory note by means of ‘noting’ and ‘protest’. When the drawee has either become insolvent or is dead. (a) the fact of dishonour. When the drawee is a fictitious person or if he cannot be traced after reasonable search. • Noting without protest is sufficient to allow a bill to be accepted for honour. sue the parties liable thereon. 2. Noting is a minute recorded by a notary public on the dishonoured instrument or on a paper attached to such instrument. When a bill is to be noted. the bill is not dishonoured until it has been dishonoured by such drawee. the bill is deemed to be dishonoured unless these several drawees are partners. Any type of negotiable instrument may be dishonoured by non-payment. Where a drawee in case of need is named in a bill or in any endorsement thereon. Such mode is by noting the instrument. Protest . It may be oral or in writing. and of everything written or printed thereupon. notice of protest must be given instead of notice of dishonour. (iii)The business must be carried on by all or any of them acting for all. 102) Contents of protest Section 101 of the Act lays down the contents of a regular and perfect protest which are as follows: 1. a statement that payment or acceptance or better security. 6. 3. (Sec. Essential Elements of Partnership (1)Agreement: Partnership must be the result of an agreement between two or more persons. 6) The Indian Partnership Act-1932 - What is Partnership? Partnership is the relation between persons who have agreed to share the profits of a business carried on by all or any one of them acting for all (Section 4). In the case of acceptance for honour or payment for honour the person by whom or for whom such acceptance or payment was offered and effected. Notice of protest may be given to prior parties. The fact of and reasons for dishonour i. occupation and . Besides the protest for non-acceptance and for non-payment the holder may protest the bill for better security. (ii) The agreement must be to share the profits of the business. The name of the person for whom and against whom the instrument has been protested. The chief advantage of protest is that the court on proof of the protest shall presume the fact of dishonour. which is a formal declaration on the bill or a copy thereof.e. or when he absconds the holder may protest it in order to obtain better security for the amount due. therefore follows that a partnership consists of three essential elements: (i) It must be a result of an agreement between two or more persons. 4. All these essentials must coexist before a partnership can come into existence.e. has been demanded of such person by the notary public from the person concerned and he refused to give it or did not answer or that he could not be found. protest may be made. It.Protest is a formal certificate of the notary public attesting the dishonour of the bill by non-acceptance or by non-payment. The instrument itself or a literal transcript of the instrument. For this purpose the holder may employ a notary public to make the demand on the acceptor and if refused. 5. as the case may be. (2) Sharing profits of the business: First. After noting. It may also be implied from the act done by partners and from a consistent course of conduct being followed. the next step for notary is to draw a certificate of protest. 2. trade. there must exist a business i. When promissory notes and bills of exchange are required to be protested. When the acceptor of a bill becomes insolvent or suspends payment before the date of maturity. The signature of the notary public. showing mutual understanding between them. An agreement from which relationship of Partnership arises may be express. The time and place of demand and dishonour. the liability of the partners is unlimited. Although the right to participate in profits is a strong test of partnership. otherwise to the guaranteed amount. yet whether the relation does or does not exist must depend upon the whole contract between the parties. but in the case of the company a member is not an agent of the other members or of the company. 4. Partnership is merely an abstract legal relation between the partners. it has no legal personality distinct from the personalities of its constituent members. there must be an agreement to share profits. Section 6 has to be referred. True test of Partnership The sharing of profits or of gross returns accruing from property by persons holding joint or common interest in the property would not by itself make such persons partners. Partnership is thus that invisibility which binds the partners together and firm is the visible form of those partners who are thus bound together Partnership vs. regard must be had to the real relation between the parties as shown by all relevant facts taken together. The agreement to share losses is not an essential element. The motive of the business is the acquisition of gains. Personality : A firm is not legal entity I. This is the cardinal principle of the partnership Law. . upon a simple participation in profits. Distribution of profits: the profits of the firm must be distributed among the partners according to the term of the partnership deed but there is no such compulsion in the case of company. unless agreed otherwise. A firm is a concrete thing signifying the collective entity for all the partners. in the case of the company limited by shares. 3. Secondly. and there may be cases where. Agency: In a firm. On the other hand. every partner is an agent of the other partners. Distinction between partnership and firmPersons who have entered into partnership with one another are called individual “Partners” and “collectively” and the name under which the business is carried on is called “firm name”. In such a case for testing the existence or otherwise of partnership relation. Joint Stock Company1. (3)Business carried on by all or any of them acting for all: Each partner carries on the business as a principle as well as the agent on behalf of the other partners. But the task becomes difficult when either there is no specific agreement or the agreement is such as does not specially speak of partnership.profession. if any unpaid on his shares. Therefore.while in the case of the company the liability of the shareholder is limited to the amount. the true test of partnership is mutual agency rather than sharing of profits.e. Extent of liability : In a firm. there is a partnership. as well as that of the firm. However in the event of losses. 2.. Therefore there can be no partnership where there is no intention to carry on the business and to share the profit thereof. a registered company is a judicial person distinct from its members. these must be born in the profit sharing ratio. According to this Section. Hindu Undivided Family1. Unlike a partner. In partnership. 5.5. a member of a club is not the agent of other members nor is he liable to a creditor of the club. the Karta or the manager has the authority to contract for the family business. but in a Hindu undivided family. but of promoting some beneficial purposes such as improvement of health or providing recreation for the members. all the partners are equally entitled to take part in the partnership business. unless they take part in the act performed or transactions entered into by the Karta. 1. But the death of a member in the Hindu undivided family does not give rise to dissolution of the family business. the liability of a partner is unlimited. Also.a share in the partnership cannot be transferred without the consent of all the partners but in the public limited company it is freely transferable. 4. the joint estate. 8. Property: The firms property is that which is the joint state of all the partners as distinguished from the separate state of any of them and it does not belong to a body distinct from its members. Liability: In a partnership. etc. Management: In the absence of an express agreement to the contrary all the partners are entitled to participate in the management of the firm but the members of the company are not entitled to participate in the management unless they have been appointed as directors. whereas the right in the joint family is created by status. So in the case of insolvency . every partner can. Partnership vs. 6. Creation: The relation of partnership is created necessarily by an agreement. the change in the membership of a club does not affect its existence. A member of a club has no interest in the property of the club. Management: The right of management of joint family business generally vests in the Karta. Partnership vs. only the liability of the Karta is unlimited. as a partner has in the property of the firm. Transfer of shares: In a firm. ClubA club is an association of persons formed with the object not of earning profit. bind the firm. partnership is also an association of persons but formed with the object of earning profit. after meeting the liability in respect of the joint debts devolves on the partners. Death: Death of a partner ordinarily leads to the dissolution of partnership. But in the case of a partnership. 7. On the other hand. . the governing male member of the family. by his act. Number of membership: In the case of a firm carrying banking business the number of members cannot exceed 10 but otherwise 20. 2. and the other copartners are liable only to the extent of their share in the profits of the family business. 2. except when he is responsible for the contract which gave rise to the liability. Authority to bind the firm: In the joint family. The creation of a right by status means its creation by birth in the family. 3.A private company may have as many as 50 members but not less than two and a public company may have any number of members but not less than seven. though the can be admitted to the benefits of partnership. 4. a co-owner is not the agent of other co owners. Association1. a minor becomes a member of the ancestral business by the incidence of birth. Co-Ownership1. 2. Co-ownership may be dissolved at the will of co-owners. a Joint Hindu family business is governed by the Hindu Law. He does not have to wait for attaining majority. Partnership always arises out of a contract. It means that profits and losses must have to be shared but co-ownership does not necessarily involve sharing of profits and losses. 7. Partnership does not exist between members of a mutual insurance society. 3. only with the consent of all the partners. with the intention of share the profits of such a business. also a co owner may transfer his interest or rights in the property without the consent of other co-owners. 3.6. a minor cannot become a partner. express or implied co-ownership may arise either from agreement or by the operation of law. provided he also seeks the dissolution of the firm. Calling for accounts: On the separation of the joint family. A share in the partnership is transferred only by the consent of other partners. there is community of interest. but a firm subject to a contract between the partners gets dissolved by death or insolvency of a partner. 8. but in the case of a co ownership. In the case of partnership. though actually he is not. but partnerships does not exist between members of a charitable society or religious association or an improvement scheme or building corporation etc 2. He is liable like a partner in the firm to anyone who on the faith of such representation . In partnership. But a partner can bring a suit against the firm for accounts. In Hindu undivided family business. a member is not entitled to ask for account of the family business. Partnership means and involves setting up relation between two or more persons who have entered into a business for gains. Partnership vs. ‘Partner’ by holding out’ (Section 28)-A person may himself. a partner is the agent of the other partners. Minor’s capacity: In a partnership. Continuity: A Joint Hindu Family has the continuity till it is divided. the relation between the members is not that of partnership. by his words or conduct have induced other to believe that he is a partner or he may have allowed others to represent him as a partner. Partnership vs. Governing Law: A partnership is governed by the Partnership Act. 9. such as by inheritance. Types of Partners1. The status of Joint Hindu Family is not thereby affected by the death of a member. In a trade combine or protection association. If the minor becomes partner of his own willingness or by his failure to give the public notice within specified time. Mutual Rights and Duties of Partners- . (ii) His share in the property and the profits of the firm remains the same to which he was entitled as a minor. Minor’s Position in PartnershipThough a minor cannot be a partner in a firm. consequent upon an agreement between a partner in a firm and a stranger. If he elects to become a partner. but he can have no right against the main firm to take part in or to interfere with its business or to examine its account. inspect and copy the accounts of the firm. whichever date is later. (iv) On attaining majority he may within 6 months elect to become a partner or not to become a partner. he can nonetheless be admitted to the benefits of partnership under Section 30 of the Act. Such an agreement will not render the stranger a partner of the main firm. and not otherwise. he may give public notice that he has elected not to become partner and such notice shall determine his position as regards the firm. (ii) He can have access to. then he is entitled to the share to which he was entitled as a minor. (ii) Within 6 months of his attaining majority or on his obtaining knowledge that he had been admitted to the benefits of partnership. A subpartner can claim the agreed share from the actual partner. the position will be as follows: (i) He becomes personally liable to third parties for all acts of the firm done since he was admitted to the benefits of partnership. (iii) He can sue the partners for accounts or for payment of his share but only when severing his connection with the firm. When this has been done and it can be done with the consent of all the partners then the rights and liabilities of such a partner will be governed under Section 30 as follows: Rights: (i) A minor partner has a right to his agreed share of the profits of the firm. the latter is vested with interest jointly with that partner so far as his share in the firm is concerned. he can be validly given a share in the partnership profits. 2. then his share is not liable for any acts of the firm after the date of the public notice served to that effect. Liabilities: (i) The minor’s share is liable for the acts of the firm.has given credit to the firm. If he fails to give such notice he shall become a partner in the firm on the expiry of the said six months. If he does not. but he is not personally liable for any such act. In other words. Sub-partnership: A sub-partnership may arise when. Partnership by ‘holding out’ is also known as partnership by estoppel. The result in both the cases is identical. the interest on advances keep running even often dissolution and up to the date of payment. The above mentioned provisions of law will be applicable only if there is no contract to the contrary between the partners. a suit for accounts without seeking dissolution. Right to remuneration: No partner is entitled to receive any remuneration in addition to his share in the profits of the firm for taking part in the business of the firm. Right to share profits: partners are entitled to share equally in profits earned and so contribute equally to the losses sustained by the firm (section 13(b)) 7. But no change in the nature of the business of the firm can be made without the consent of all the partners [Section 12(c)]. Can the Court interfere in these circumstances? The answer is in the affirmative. 3. he is not a creditor of the firm but an adventure. Now suppose this management power of the particular partners is interfered with and he has been wrongfully precluded from participating therein. a suit for dissolution. Interest on advances: The partner is entitled to claim interest thereon @6% per annum [Section 13(d)]. This is because partnership business is a business of the partners and their management powers are generally coextensive. by Injunction. 6. But this rule can always be varied by an express agreement.. As a general rule.g. 5. and every partner shall have the right to express his opinion before the matter is decided. 4. (Section 13(e)) . Right to be consulted: Where any difference arises between the partners with regard to the business of the firm. it shall be determined by the views of the majority of them. interest on capital subscribed by partners is not allowed unless there is an agreement or usage to that effect. While interest in capital account ceases to run in dissolution. The Court can. restrain other partners from doing so. Subject to a contract between the partners the mutual rights and liabilities are as follows: Rights: (1) Right to take part in the conduct of the Business: Every partner has the right to take part in the business of the firm. in which event the partner will be entitled to remuneration. and will. The principle underlying this provision of law is that regards the capital brought by a partner in the business. Right to access the books of accounts: Every partner whether active or sleeping is entitled to have access to any books of firm and to inspect and take out the copy thereof (Sec12 (d)) 8 Right to be indemnified: Every partner has the right to be indemnified by the firm with respect of payments made and liabilities incurred by him in the ordinary and proper conduct of the business as well as in the performance of an act in an emergency for protecting the firm from any loss. etc. e. or by a course of dealings.The contract may provide that a partner shall not carry on any business other than that of the firm while he is a partner (Section 11). 2. Interest on Capital: The interest will be payable only out of profits. The main point is that a partner who has been wrongfully deprived of the right of participation in the management has also other remedies. by giving notice to that effect to all other partners. to the greatest common advantage b. Right of outgoing partner to share subsequent profits: When any partner has died or ceased to be a partner. Right of outgoing partner to carry on competing business: An outgoing partner can carrying on business competing with the firm and he may advertise such business.9. Right not to be expelled: Every partner has got a right not to be expelled from the firm by the majority of the partners. 5. Duties: 1. Partners are bound to carry on business of the firm a. Right to stop admission of a new partner: Every partner has the right to stop the introduction of the new partner without the consent of other partners. Right to dissolve the firm: Every partner has the right to dissolve the partnership with the consent of other partners and in the case of partnership at will. Right to retire: Every partner has the right to retire with the consent of other partners and in the case of partnership at will. than at the representative option. by any partner giving notice to that effect to all other partners. but without using the firm name or representing himself as carrying on the business of the firm or soliciting the custom of persons who were dealing with the firm before he ceased to be a partner (Section36(1)).(Section33) 12. To be just and faithful to each other c. All the partners are liable to contribute equally to the loss sustained by the firm. and the surviving or continuing partners carry on the business of the firm with the property of the firm without any final settlement of the accounts as between them and the outgoing partner. Every partner is bound to attend diligently to his duties relating to the conduct of the firm’s business (Section12 (b)) 4.(section 31) 10. To render to any partner or his legal representative a true account and full information of all the things affecting the firm(Section9) 2. If a partner derives any profit for himself from any transaction of the firm or from the use of the property or business connection of the firm or the firm’s name then he is bound to account for that profit and refund it to the firm.(section 32(1)) 11.(Section16(a) .(section 40) 13. can either take them proportion of the profits attributable to the share of property or interest at the rate of 6% per annum. 14. Every partner is liable to indemnify the firm for any damage caused ti it by the reason of its fraud in the conduct of his business of the firm (Section10) 3. If a partner carries on business of the same nature as and competing with that of the firm. i. he must account for that profit and pay it to the firm.6. then he must account for and pay to the firm all profits made by him in the business and the firm is not liable for any loss(Section16(b)) Personal Profit Earned by Partners (Section 16)Where a partner derives any profit for himself from any transaction of the firm or firm the use of the property or business connection of the firm name. Implied Authority of a Partner of the firm- . A deed of partnership may contain a clause that some or all the partners are not to carry any business other than of the firm during the continuance of partnership [Section 11(2)]. A partner must identify the firm for any loss caused to it by the wilful neglect of the business of the firm. namely: (i) Where a new partner or partners come in. Rights and Duties of Partners after a Change in the constitution of the firm (Section 17) Change in the constitution can occur in one of the four ways. whereas an agent as such has no interest in either. (Section13 (f)) 7. Partner is the agent of the firm for the purpose of the business of the firm. but it will not gives rise to any occasion for accounting to his co-partners for the profit earned unless the business is shown to be in rivalry with the business of the firm. (b) Where the partnership business is carried on after the expiry of the term fixed for the purpose so far they are consistent with the incidents of partnership at will. (ii) Where some partner or partners go out.. It is applicable only to the act done by partners for the purpose of the business of the firm. Relation of Partners to Third Parties (Sec. A breach of such a provision may entitle the other partner to recover damages from the defaulting partner. by death or retirement. (iv) Where the partnership business is carried on after the expiry of the term fixed for the purpose. (a) Where the change occurs in the constitution because of the first three reasons then the mutual rights and duties of the partners remains the same as before.e. 18-30)The principal distinction between him and a mere agent is that he has a community of interest with other partners in the whole property and business and liabilities of partnership. (iii) Where the partnership concerned carries on business other that the business for which it was originally formed. cannot be applied to all transaction and dealings between the partners themselves. received money or property from a third person and the same is misapplied by a partner. A partner has implied authority to bind the firm by all acts done by him in all matters connected with the partnership business and which are done in the usual way and are not in their nature beyond the scope of partnership.e. while it is in the custody of the firm. and (h) Enter into partnership on behalf of the firm. must have been done while he was a partner. all the partners in a firm are liable to a third party for loss or injury caused to him by the negligent act of a partner acting in the ordinary course of the business. an outsider). (e) Admit any liability in a suit or proceedings against the firm. receives money or other property from a third person and misapplies it or (b) where a firm. 2. in the course of its business. 29)- . is liable to make good the loss.If the act is “outside the usual course of the business of the firm” it will not bind the firm even if it is prudent or has benefited the firm unless it is ratified and approved by all the partners. (d) Withdraw a suit or proceedings filed on behalf of the firm. 3. in respect of which liability is bought to be enforced against a party. (c) Compromise or relinquish any claim or portion of a claim by the firm against a third party (i. the implied authority of the partner does not empower him to: (a) Submit a dispute to the business of the firm to arbitration as it is not the ordinary business of partnership firm to enter into a submission for arbitration: (b) Open a bank account on behalf of the firm in his own name. Contractual liability: Under Section 25. Acts beyond Implied Authority (Section 19) If there is no usage or custom of trade to the contrary. Liability to Third Parties (Section 25 to 27)1. acting within his apparent authority. it is necessary that the act of the firm. (f) Acquire immovable property on behalf of the firm. Rights of Transferee of a Partner’s Share (Sec. the fact that the method employed by the partner in doing it was unauthorised or wrongful would not affect the question. Liability for tort or wrongful act: Section 26. (g) Transfer immovable property on belonging to the firm. Power to do the usual does not include power to do the unusual. Furthermore. Liability for misappropriation by a partner: Section 27 provides that (a) when a partner. unless the other partners agree to accept that person as a partner. subject to a contract between partners and to the provisions regarding minors in a firm. which we will discuss hereinafter. Introduction of the new partner: The liabilities of the new partner ordinarily commence from the date when he is admitted as a partner. (b) to require accounts. he is entitled to an account as from the date of the dissolution. Legal Consequences of Partner Coming in and going out (Section 31-38)Introduction of new partner (Section 31): As we have studied earlier. The new firm.e. mortgage or otherwise cannot enjoy the same rights and privileges as the original partner. The Supreme Court has held the assignee will enjoy only the rights to receive the share of the profits of the assignor and the account of profits agreed to by other partners. make anybody else a partner in his stead. (ii) By virtue of an express agreement between the partners. including the new partner who joins it. against the remaining partners: (a) to receive the share of the assets of the firm to which the transferring partner was entitled. At the same time. The rights of such a transferee are as follows: (1) During the continuance of partnership. Rights of Transferee of a Partner’s Share (Sec. may agree to assume liability for the existing debts of the old firm. a partner is not debarred from transferring his interest. A partner cannot by transferring his own interest. (2) On the dissolution of the firm or on the retirement of the transferring partner. the transferee will be entitled. or (iii) In the case of a partnership at will. unless he agrees to be liable for obligations incurred by the firm prior to the date. and creditors may agree to accept the new firm as their debtor and discharge the old partners. no new partners can be introduced into a firm without the consent of all the existing partners. or (c) to inspect books of the firm. Retirement of a partner: A partner may retire: (i) With the consent of all the other partners. by giving notice in writing to all other partners of his intention to retire. he cannot challenge the accounts. A partner’s interest in the partnership can be regarded as an existing interest and tangible property which can be assigned. 29)By virtue of Section 31. no person can be introduced as a partner in a firm without the consent of all the partners. the assignee of a partner’s interest by sale. and (b) for the purpose of ascertaining the share. such transferee is not entitled (a) to interfere with the conduct of the business.A share in a partnership is transferable like any other property but as the partnership relationship is based on mutual confidence. .. He is only entitled to receive the share of the share profits of the transferring partner and he is bound to accept the profits as agreed to by the partners. i. (b) An outgoing partner. The test of good faith as required under Section 33(1) includes three things: (a)That the expulsion must be in the interest of the partnership. and (iii) it has been exercised in good faith. (ii) (a) on the retirement of a partner. where the continuing partners carry on business of the firm with the property of the firm without any final settlement of accounts with him. however.Such a partner. the expulsion is not deemed to be in bonafide interest of the business of the firm. he will not carry on a business similar to that of the firm within a specified period or within specified local limits. . Such an agreement will not be in restraint of trade if the restraint is reasonable [Section 36(2)]. he can claim interest at the rate of 6% per annum on the amount of his share in firm’s property (Section 37). and the firm also is not liable for any act of such a partner after such date (whether or not under a contract between the partners the firm is dissolved by such adjudication). (ii) the power has been exercised by a majority of the partners. (b) That the partner to be expelled is served with a notice. But the retired partner will not be liable to any third party of the latter deals with the firm without knowing that the former was partner [Sub-Section (3) and (4)]. an option has been given to the surviving or continuing partners to purchase the interest of the outgoing partner and the option if duly exercised. (c) That he is given an opportunity of being heard. thus. His estate (which thereupon vests in the official assignee) ceases to be liable for any act of the firm done after the date of the order. the partner may agree with his partners that on his ceasing to be partner. In the alternative. A similar rule applies to such an agreement of sale of the firm’s goodwill [Section 53(3)]. if by a contract between the partners. (c) However. Right of outgoing partners(i)However. he has the right to receive his share of the property of the firm including goodwill. is entitled to claim from the firm such share of the profits made by the firm. Expulsion of a partner (Section 33): It is. If all these conditions are not present. essential that: (i) the power of expulsion must have existed in a contract between the partners. since he ceased to a partner. Insolvency of a partner (Section 34): When a partner in a firm is adjudicated an insolvent. the outgoing partner or his estate will not be entitled to any further share of the profits. he ceases to be a partner on the date of the order of adjudication whether or not the firm is thereby dissolved. as attributable to the use of his share of the property of the firm. continues to be liable to the third party for acts of the firm after his retirement until public notice of his retirement has been given either by himself or by other partners. Liabilities of an outgoing partner: The retired partner will not be liable to any third party of the latter deals with the firm without knowing that the former was partner [Section 32 (3)&(4)]. State C P C. 7)COPRA- The consumer Councils (Central Consumer Protection Council. but the rule in regard to the dissolution of the partnership. the estate of the deceased partner is not liable for act of the firm after his death. In such a case. revoked as to future transaction from the date of any change in the constitution of the firm. This because there was no debt due in respect of the goods in X’s lifetime. X’s estate would not be liable for the debt. a creditor can have only a personal decree against the surviving partners and a decree against the partnership assets in the hands of those partners. Ordinarily. X was a partner in a firm. In relation to Section 35. District CPCouncil) have to ensure the following to the consumers .Death of a partner (Section 35): Where under the contract a firm is not dissolved by the death of partner. it is not necessary to give any notice either to the public or the persons having dealings with the firm. The firm ordered goods in X’s lifetime. but the delivery of the goods was made after X’s death. in the absence of an agreement to the contrary. In order that the estate of the deceased partner may be absolved from liability for the future obligations of the firm. let us consider a concrete case. Revocation of continuing guarantee by change in the firm (Section 38): It provides that a continuing guarantee given to a firm or to third party in respect of the transaction of a firm is. A suit for goods sold and delivered would not lie against the representatives of the deceased partner. by death of partner is subject to a contract between the parties and the partners competent to agree that the death of one will not have the effect of dissolving the partnership as regards the surviving partner sunless the firm Consists of only two partners. the effect of the death of a partner is the dissolution of the partnership. . Appellate and revisional jurisdiction National commision has Pecuniary. Appellate .Jurisdiction (Pecuniary)District forum – upto 20 Lakhs + territorial jurisdiction State Commission 20 lakhs to 1 crore + territorial jurisdiction National Commision Above 1 crore District forum has only pecuniary jurisdiction State Commission has Pecuniary.revisional jurisdiction and review jurisdiction . territorial. territorial. . User wants the electronic records to be confidential & protected from tampering . 2000. Increase in Volumes & Complexities of transactions. The IT Act has been conceptualized on the United Nations Commission on International Trade Law (UNCITRAL) Model Law Change in the Environment Technological Revolution. While activities in this limitless new universe are increasing incessantly. the need for laws to be formulated to govern all spheres of this new revolution was felt. In order to keep pace with the changing generation the Indian Parliament passed Information Technology (IT) Act.8) INFORMATION TECHNOLOGY ACT Connectivity via the Internet has greatly abridged geographical distances and made communication even more rapid. 12th nation in the world to have cyber laws Also Amended: - Indian Panel Code 1862 Indian Evidence Act 1872 The Bankers’ Book Evidence Act 1891 Reserve Bank of India Act 1934 The Act aims at providing legal recognition for transactions carried out by means of electronic data interchange and other means of electronic communications commonly referred to as "electronic commerce" which involve the use of alternative to paper based methods of communication and storage of information and aims at facilitating electronic filing of documents with the government agencies and e-payments. a trust as defined in section 3 of the Indian Trusts Act. a power-of-attorney as defined in section 1A of the Power-of-attorney Act. Information Technology Act in a capsule Called the Information Technology Act. 1882. any contract for the sale or conveyance of immovable property or any interest in such property. It does not apply to the following. . It also applies to any offence committed outside India by any person. 1882. Came into force in June. Shall come into force as per notification by the Central govt. User wants to trust the participants are who they claim to be IT Act 2000 Became statute on 17th May 2000.2000 Extends to whole of India and also to people who contravene the provisions of the act outside India. 1925 (39 of 1925) including any other testamentary disposition by whatever name called. a will as defined in section 2 (h) of the Indian Succession Act. 2000. a negotiable instrument as defined in section 13 of the Negotiable Instruments Act. The Act applies to the whole of India. 1881. any such class of documents or transactions as may be notified by the Central Government in the Official Gazette. If however. Once the subscriber has accepted the DSC. A private key is used to create a digital signature whereas a public key is used to verify the digital signature and electronic record. Every subscriber is under an obligation to exercise reasonable care and caution to retain control of the private key corresponding to the public key listed in his DSC. A digital signature means an authentication of any electronic record by a subscriber by means of an electronic method or procedure in accordance with the other provisions of the Act. security and confidentiality of records or e) payments and rules regarding any other appropriate matters These signatures are to be authenticated by Certifying Authorities (CAs) appointed under the Act. Thus a subscriber can authenticate an electronic record by affixing his digital signature. The applicant must have a private key that can create a digital signature. the Act provides that when any information or other matter needs to be authenticated by the signature of a person. the same can be authenticated by means of the digital signature affixed in a manner prescribed by the Central Government. his agent or an information system programmed by or on his behalf are attributable to him . These authorities would inter alia. he must communicate the same to the Certifying Authority (CA) without any delay. The subscriber must take all precautions not to disclose the private key to any third party. Further. DIGITAL SIGNATURES: LEGITIMACY AND USE Section 3- The Act has adopted the Public Key Infrastructure (PKI) for securing electronic transactions. the private key is compromised. This private key and the public key listed on the DSC must form the functioning key pair. They both are unique for each subscriber and together form a functioning key pair. DESPATCH & ACKNOWLEDGEMENT. have the license to issue Digital Signature Certificates (DSCs). The Act also gives the Central Government powers: a) to make rules prescribing the digital signature b) the manner in which it shall be affixed c) the procedure to identify the person affixing the signature d) the maintenance of integrity. he shall generate the key pair by applying the security procedure.ELECTRONIC RECORDS section 4- All electronic records sent by an originator. Attribution of Electronic Records - Shall be attributed to the originator if Sent by originator By a person having authority to act on behalf of originator By an information system programmed by originator or his behalf to operate automatically. then the originator may give a notice to the addressee stating that no such acknowledgement has been received and specifying a time by which the acknowledgement must be received by him. computer system etc. 6 & 7 - Legal recognition of Digital Signatures Use of Electronic Records in Government & Its Agencies Retention of Electronic Records Section 11. he may after giving notice to the addressee treat the electronic data as never sent Unless otherwise agreed the dispatch of an electronic record occurs when it enters a computer resource outside the control of the originator Unless otherwise agreed the time of receipt of electronic record shall be determined as follows: if the addressee has designated a computer resource for the purpose of receiving electronic records- receipt occurs at the time when the electronic record enters the designated computer resource. receipt occurs when it is retrieved by the addressee Sections 5. Where the originator has not agreed with the addressee that the acknowledgement of receipt of electronic data shall be given in a manner. automated or otherwise. the acknowledgement may be given by Any communication by the addressee. it shall mean that the electronic data was never sent. Penalty for damage to computer.- . then unless acknowledgement has been received. if still no acknowledgement is received. or Any conduct of the addressee. sufficient to indicate to the originator that the electronic record has been received Where the originator had stipulated that it shall be binding only on receipt of acknowledgement. Where no such stipulation was made. or if the electronic is sent to a resource that is not designated. Sec 43 to 47- provides for penalties and adjudications Sec 48 to 64- prescribes for establishment of Appellate tribunals etc and compounding of contraventions. Sections 65-78 Offences Tampering with computer source documents (sec 65) Hacking with computer system (sec 66) Publishing of information which is obscene (Sec 67) The act to apply for offences or contraventions committed outside India. (sec 68) “Damage" means to destroy, alter, delete, add, modify or rearrange any computer resource by any means Tampering with the computer source documents. Whoever knowingly or intentionally conceals, destroys, or alters or causes another to do the same any computer source code used for a computer, computer programme, computer system or computer network, shall be punishable with imprisonment up to three years, or with fine upto Rs. 2 lakhs or with both. Whoever commits hacking of the computer system shall be punished with imprisonment up to three years, or with fine upto Rs. 2 lakhs or with both. Whoever publishes or transmits or cause to be published any matter which is obscene, shall be punished on first conviction with imprisonment may extend upped five years with a fine of upped RS. 1,00,000 (for second and subsequent convictions, imprisonment of upped 10 years and a fine of upped RS. 2,00,000) The government may notify certain computer systems or networks as being "protected systems", unauthorized access to which may be punishable with imprisonment upped 10 years in addition to a fine. Whoever makes a misrepresentation to, or suppresses any material fact from the Controller of Certifying Authorities and whoever commits breach of confidentiality and privacy, having access to electronic data under the Act shall be punished with imprisonment for a term which may extend to two years, or with fine which may extend to RS. 1,00,000 or with both. Penalties have also been prescribed for publishing false digital signature certificates or for use of such certificates for fraudulent and unlawful purposes, which is imprisonment for a term which may extend to two years, or with fine which may extend to Rs. 1,00,000 or with both ADJUDICATION /COMPENSATION The Act provides the following: a) Damages by way of compensation not exceeding Rs. 10 million may be imposed for unauthorized access, unauthorized downloading or copying of data, introduction of computer viruses or contaminants, disruption of systems, denial of access or tampering with or manipulating any computer/network. “Computer contaminant" means set of computer instructions designed: - to modify, destroy, record, transmit data or programe residing within a computer, computer system or computer network; or - by any means to usurp the normal operation of the computer, computer system, or computer network; Computer data base" means a representation of information, knowledge, facts, concepts or instructions in text, image, audio, video are prepared or being prepared or produced by a computer, computer system or computer network and are intended for use in a computer, computer system or computer network; “Computer virus" means any computer instruction, information, data or programme that destroys, damages, degrades or adversely affects the performance of a computer resource or attaches itself to another computer resource and operates when a programme, data or instruction is executed or some other event takes place in that computer resource; b) The Act does provide that no penalty imposed under the Act shall prevent imposition of any other punishments attracted under any other law for the time being in force. OFFENCES OUTSIDE INDIA - The provisions of the Act shall also apply to offences or contravention outside India, if such offences or contravention involves a computer, computer system or computer network located in India. CYBER REGULATIONS APPELLATE TRIBUNAL (CRAT)- A Cyber Regulations Appellate Tribunal (CRAT) is to be set up for appeals from the order of any adjudicating officer. It consists of one person only- the Presiding Officer. No appeal shall lie from an order made by an adjudicating officer with the consent of the parties. Every appeal must be filed within a period of forty-five days from the date on which the person aggrieved receives a copy of the order made by the adjudicating officer As per the Act a provision has been made to appeal from the decision of the CRAT to the High Court within sixty days of the date of communication of the order or decision of the CRAT . POWERS OF POLICE TO SEARCH, ARREST, ETC. A police officer not below the rank of Deputy Superintendent of Police, or any other officer authorised by the Central Government has the power to enter any public place and arrest any person without a warrant if he believes that a cyber crime has been or is about to be committed. Public place includes public conveyance, any hotel, any shop or any other place intended for use by, or accessible to the public NETWORK SERVICES PROVIDERS / ISP Section 79- provides for non liability of network service provider in certain cases if he proves that the offence or contravention was committed without his knowledge or that he had exercised all due diligence to prevent the commission of such offence or contravention Network services providers shall not be liable under this Act for any third party information or data made available, if they prove that the offence or contravention was committed without their knowledge or that they had exercised all due diligence to prevent such offence. Network service provider means an intermediary: Third party information means any information dealt with by network service provider in his capacity as intermediary OFFENCES BY COMPANIES In respect of offences by companies, in addition to the company, every person, who at the time the contravention was committed, was in charge of, and was responsible to the company for the conduct of the business of the company, shall be guilty of the contravention, unless he proves that the contravention took place without his knowledge or that he exercised all due diligence to prevent such contravention. 9)IPRIntellectual Property Rights Objective and Plan of PresentationObjective • To give a general introduction to the concept of Intellectual Property Rights and Their Role in Technology Transfer Plan of Presentation • • • Rationale of Protection Different kinds of IPRs IPRs and Licensing/Technology Agreements Introduction-Kinds of Property- • • • Movable Property Car, Pen, Furniture, Dress Immovable Property Land, Building Intellectual Property inventions Nature of Intellectual Property- • • • • • • Creation of human mind (Intellect) Intangible property Exclusive rights given by statutes Attended with limitations and exceptions Time-bound Territorial Definition of Intellectual Property “Intellectual Property shall include the rights relating to • • • • • • • literary. performances of performing artists.” (WIPO Convention) International Treaties Paris Convention for the Protection of Industrial Property 1883 Berne Convention for the Protection of Literary and Artistic Works 1886 International Union for New Varieties of Plants (UPOV) 1961. 1978 and 1991 Convention on Biodiversity. phonograms. and broadcasts. artistic and scientific works. 1992 Agreement on Trade Related Aspects of Intellectual Property Rights 1994 Internet Treaties 1996 Basic Principle • • Contract between creator and sovereign state Protection for revelation Balance between rights of creator and public interest . literary or artistic fields. 1972. Literary works. inventions in all fields of human endeavour scientific discoveries Industrial designs trademarks. service marks and commercial names and designations protection against unfair competition and all other rights resulting from intellectual activity in the industrial. scientific. 1957 Higher Education The Patents Act. 1999 Industrial Policy & Promotion The Geographical Indications of Goods (Registration and Protection) Act. 2000 Industrial Policy & Promotion The Trade Marks Act. Musical and Artistic Works Work: Ideas expressed in material form No copyright in ideas or facts Cinematograph Films Sound Recordings Rights • Two Kinds of Rights Moral Rights To protect personality of author Economic Rights . 1970 Industrial Policy & Promotion The Designs Act. Dramatic. 2000 Information Technology The Protection of Plant Varieties and Farmers’ Rights Act. Rights and limitations and exceptions Major Intellectual Properties Copyright and Related Rights Industrial Property Patents Industrial Designs Trade Marks Geographical Indications Layout Designs/Topographies Integrated Circuits Trade Secrets Protection of New Plant Varieties IP Laws of IndiaAct Ministry/Department The Copyright Act. 1999 Industrial Policy & Promotion The Semiconductor Integrated Circuits Layout Design Act. 2001 Agriculture and Cooperation Copyright and related rights-Scope of Copyright- • • • Original Literary. g. comic formats Right to make a cinematograph film or sound recording Translation Rights Rental Rights . literary to drama Abridgement Picturizations.To bring economic benefits Moral Rights • • • Right of Authorship Right of Integrity ◦ ◦ Digital Manipulation No Right for Display Inalienable Rights Economic Rights -1 • • • Right of Reproduction ◦ ◦ Making copies e. an edition of a novel Storage in computer memory Right of Distribution/Issuing Copies ◦ Digital Distribution Right of Communication to the Public ◦ ◦ Public Performance Internet Communication Economic Rights 2 • • • • Adaptation Rights – – – Conversion into another form e.g. magazine – employer has publishing right. Ownership of Rights • • • • • • • • Literary – author Drama – Dramatist Music – Composer Artistic work – Artist e. Painter. sculptor. dictionary – editor for collection Music under contract by film producer – film producer Securing Copyright • • Formality free protection Voluntary Registration (S. 44 & 45) .producer Author as Owner of Rights: Exceptions • • • In the course of employment – employer Employment by newspaper.• Resale Rights for original artistic works.g. painting. architect Photograph – Photographer Author of Computer Programme – Person who causes the work to be created Cinematograph film – producer Sound Recording . other rights with author Photograph. cinema for valuable consideration – person who pays money Author as Owner of Rights: Exceptions • • • • • • • • • Lecture delivered in public – Person delivering Government Work – Government Public Undertaking Work – public undertaking Work of International Organization – International Organization Work of apprentice – to Teacher If teacher writes a book then teacher because he is employed to teach and not write Question Papers – Paper setter Encyclopedia. .20 Years WHAT CAN BE PATENTED? Inventions in all fields of technology. without permission. if they meet the criteria of • • Novelty. broadcasting and communicating to the public of a live performance Presumption of transfer of performer’s right to cinematographic film producer Duration: 50 years Rights Of Broadcasting Organisations • • • Broadcast Reproduction Right Re-broadcasting. using or selling the patented product or from using the patented process. dramatic. Period of Patents . Recording and Communicating to the Public of a Broadcast Duration: 25 Years Patents-What is a PATENT?- • • • A patent is an exclusive right granted for an invention.• Registration does not as a matter of law establish that what is registered is in fact and in law copyrightable subject matter Duration of Copyright • • Literary. Non-obviousness (inventive step). or offers a new technical solution to a problem The limited monopoly right granted by the state enables an inventor to prohibit another person from manufacturing. whether products or processes. Anonymous Works Works of Government and Organizations Cinema and Sound Recording Photograph RELATED RIGHTS • Rights granted by law to communicators of works to the public ◦ ◦ Performers Broadcasting Organizations Performer’s Rights • • • Recording. which is a product or a process that provides a new way of doing something. Musical and Artistic Works published during life time of author: Life + 60 years All Other Works: 60 years from date of publication • • • • Posthumous. Invention adds to human knowledge by suggesting an action resulting in a new product or new process . Conditions of Patentability • • • Novelty: Invention not known to public prior to claim by inventor Inventive Step: Invention would not be obvious to a person with ordinary skill in the art Industrial Application: Invention can be made or used in any useful.g. not seen before. practical activity as distinct from purely intellectual or aesthetic one Grant of Patent • • • • Patents are granted by national patent offices after publication and substantial examination of the applications In India provisions exist for pre-grant and post grant opposition by others They are valid within the territorial limits of the country Foreigners can also apply for patents INVENTIONS – NOT PATENTABLE An Invention Which is frivolous or which claims anything obviously contrary to the well established Natural Laws e. • • • Machine giving more than 100% performance Perpetual motion machine Newton’s laws of gravitation INVENTIONS – NOT PATENTABLE A machine whose primary or intended use or commercial exploitation of which could be contrary to Public order or morality or which causes serious prejudice to human.• Industrial application (utility). animal or plant life or health or to the environment : • • • • • Gambling machine device for house-breaking Biological warfare material or device Terminator gene technology embryonic stem cell INVENTIONS – NOT PATENTABLE Mere Discovery of a Scientific Principle or Formulation of an Abstract Theory or discovery of any living thing or non–living substance occurring in nature • Discovery adds to the human knowledge by Disclosing something. whereas. Cultivation of algae . Producing new form of a known plant. lubricant. Archimedes Principle. e.Not Patentable .g.g Soap. e. An Umbrella with fan A Clock and radio in a single cabinet A flour-mill provided with sieving Not patentableMethod of Agriculture or Horticulture. However.each functioning independently of one another in a known way for example -.g. varieties and species and essentially biological process for production or propagation of plants & animals e. but including seeds. preparation of an improved soil However. Superconducting Phenomenon as such – not patentable. a mixture resulting in synergistic properties of mixture of ingredients may be patentable e. g.e. Paracetamol (Antipyretic) +Brufen (analgesic) = A drug (antipyretic & analgesic) • A soft drink that is only a mixture of sugar and some colorants in water But.Not Patentable ◦ • Plants & animals in whole or any part thereof other than micro. A Bucket fitted with torch. INVENTIONS – NOT PATENTABLE Mere arrangement or re-arrangement or duplication of known devices.organisms.g. Clones and new varieties of plants: A process for production of plants or animals if it consists entirely of natural phenomena such as crossing or selection Inventions . machine or apparatus. unless such known process results in a new product or employs at least one new reactant. INVENTIONS – NOT PATENTABLE A substance obtained by mere admixture resulting only in the aggregation of the properties of the components thereof or a process for producing such substance. • An apparatus /method for technological application may be patentable INVENTIONS – NOT PATENTABLE The mere discovery of a new form of a known substance which does not result in the enhancement of the known efficacy of that substance OR the mere discovery of any new property or new use for a known substance OR of the mere use of a known process. Agricultural Equipment are patentable Inventions . Detergent. Method for solving a crossword puzzle.Not patentable Novel apparatus for playing game or carrying out a scheme – patentable Non-patentable Presentation of information Examples – Any manner or method of expressing information . and hence. An invention which. musical or artistic work or any other aesthetic creation including cinematographic work and television productions These subject-matters fall under the copy-right protection A mere scheme or rule or method of performing mental act or method of playing game Examples – • • Scheme for learning a language . not patentable However. whether by spoken words. inventive step and industrial applicability. can be patentable Inventions relating to atomic energy – Not patentable . Method of learning a language. symbols . dramatic. is the Traditional Knowledge or an aggregation or duplication of known properties of traditionally known component or components Traditional Knowledge is already in public domain. Method of teaching /learning . any value-addition using Traditional Knowledge leading to a new process or product.diagrams or information recorded on a carrier Topography of integrated circuits. Visual display.A mathematical method or a business method or algorithms or a computer programme per se These are the outcomes of mental process only and do not involve industrial process or product For example- • • Computer programme claimed by itself or as a record on a carrier Non-patentable A literary. possessing novelty. in effect. BRUSH.fridge. Pharmaceutical Product-Injection. Textile & Jewellery –neklace. building plan. pattern.mechanical or chemical. What is Excluded? • • • • Any mode or principle of construction or anything which is in substance a mere mechanical device Trade mark Property mark Artistic work What is not registrable? • • • • • A design which is not new or original A design which has been disclosed to the public anywhere in the world prior to the filing A design which is not significantly distinguishable from known designs or combination of known designs A design which comprises or contains scandalous or obscene matter A design which is contrary to public order or morality NOT REGISTRABLE ARTICLES Calendar. by any industrial process or means.Industrial designs-What is an Industrial Design? • ‘Design’ means only the features of shape.leaflets.medicine. 2.or signs of any country. whether manual. Maps.PEN.emblems.silk cloth etc. ornament or composition of lines or colours applied to any article whether in two dimensional or three dimensional or in both forms. which in the finished article appeal to and are judged solely by the eye. 1. configuration.SHOE. certificates.medals Labels.stamps Religious symbols Mere mechanical contrivance Building and construction or real estate Flags. Rights of the Registered Proprietor • The proprietor of the registered design has the exclusive right to apply the design to any article in the class in which the design is registered • Period of protection is ten years extendable by 5 years. separate or combined. CONSUMER PRODUCTS-IRON.tokens. greeting cards. 3. computer icons Parts of articles not manufactured and soled separately .insulin.forms. colours or combination of colours. LUX. graphic representation or packaging or any combination of the above as applied to an article or a product.WOOLMARK Certification mark cannot be used as a trade mark.repairs. ingredients. insurance. shape of goods. advertising etc Certification Trade marks: Certified by the Proprietor as having characteristics like geographical origin. TVS . pictures.Telco. g. APPLE Trade Mark can be - • • • • • • sign . quality e. emblem. letters.. Godrej. finance. conveying news and information. . variations commonly used in the trade Mere workshop alteration Mere change in size Any principle or mode of construction of article Trade marks-TRADE MARK- • • A name of an enterprise or a Mark capable of being represented graphically. distinguishing the goods or services of one person from those of others e. transport. Registration of Trade Mark • • • Trade Marks are registered by national trade mark registries and are valid in that country Registration is made after examination and publication Period of registration is for 10 years but can be renewed indefinitely Kinds of Trademarks • • • • • • Marks on goods Service Marks Certification trademark Collective Marks Well known marks Trade Names TRADE MARK • • Service Marks include banking. education.g. Layout designs of integrated circuits Basic shape. words.entertainment. drawings.AGMARK. numbers. real estate . 555. shaped chocolates Trade Names• Godrej. or manufactured in the territory of country. traders or other profession bodies like institute of chartered accountants. the owner of the mark.Furniture. protection is for TM as a whole) State Emblems. Emblems of Intergovernmental Organizations cannot be used as TM. test cricketers association etc. suppliers. Geographical indications of goods-What is a Geographical Indication? Geographical Indication is an indication which identifies goods as agricultural goods. devices including drawings and symbols or 2-D representations of object or a combination of two or more of these. numerals. where a given quality. natural goods or manufactured goods as originating. Compactor etc • GE. Storewell. producers. letters. Audio: Sounds. . Official Hallmarks. 3-D sign as shape of goods or packaging.Bulbs Forms of TM • • • Visual: Words. Refrigerators. or a region or locality in that territory. It is registered in 140 countries and licensed to the companies which assure that they will comply with the strict standards set out by the Woolmark company . COLLECTIVE MARK • COLLECTIVE MARK is a Mark that distinguishes the goods -or services of members of association from marks of other undertakings • Who owns collective Mark ? Association of persons • It could be manufacturers. Musical Notes Olfactory: Smells What is protected and what’s not? • • Right to use TM in relation to goods/ services as registered are protected (If TM consists of several parts. colour combinations or colour per se. reputation or other characteristic of such goods is essentially attributable to its geographical origin. WELLKNOWN MARKS• Coca Cola for soft drink • Toblerone (Triangular.• Certifies that the goods on which it is applied are made of 100% wool. Alphonso. idea. When it is difficult to reverse engineer How to guard Trade Secret? • Restricting number of people having access to secret information . information cannot be protected by any of the available means of IPRs.• • Explanation clarifies that GI need not be a geographical name E. chemical formula.manufacturing process. When Trade Secrets are preferred? • • • • When invention is not patentable. Basmati Goods include goods of handicraft or of industry and also foodstuff. Such information is held confidential as a trade secret. financial strategy.g. survey method. Trade secret can be an invention. geographical indications have to be registered. Patent protection is limited to 20 years. experiment results. data. client database etc. Registration • • • In India. when secret can be kept beyond that period. Geographical Indications Registry examines and publishes the application before registration Registration is valid for 10 years but can be renewed indefinitely Rights • • Exclusive right to use the Geographical Indication on the goods Right to obtain relief for infringement of the Geographical Indication Semiconductor integrated circuits layout-design-Protectable Layout Designs? • • • Original and novel Layout-Designs of semiconductor integrated circuits can get protection through registration Registration is done after examination and publication of the application Registration is valid for 10 years Non-registrable Layout-Designs • • • • Not original Has been commercially exploited anywhere in India or in a convention country Not inherently distinctive Not inherently capable of being distinguishable from any other registered layout-design Trade secrets-Trade Secrets- • • Some inventions. recipe. When cost of patent protection are prohibitive. if the breeders’ variety is essentially derived from a farmers’ variety. the farmer may claim compensation from the plant breeder. exchange. Where these fail to perform in the manner claimed by the breeder. authorisation of the breeder is required “whose repeated use of such variety as parental . uniformity and stability Persons who can Register Breeders. share or sell his farm produce including seed in the same manner as he was entitled earlier (Seeds for sale should not be branded) To full disclosure of the expected performance of the Seeds or planting material by the plant breeder. Distinctiveness. the breeder cannot give any authorisation without the consent of the farmers or communities from whose varieties the protected variety is derived. agricultural institutes Period of protection 15 years for annual crops 18 years for trees and vines Rights of Breeders Production Sale Marketing Distribution Export Import However. farmers. use. Plant varieties and farmer’s rights-PROTECTION OF PLANT VARITIES- Registrable varieties and criteria: New Varieties Novelty. universities. re-sow. Farmers’ RightsTo save. Researchers’ RightsFree and complete access to protected materials for research use in developing new varieties of plants. sow. uniformity and stability Extant varieties Distinctiveness.• • Signing confidentiality agreements with business partners and employees Using protective techniques like digital data security tools and restricting entry into area where trade secret is worked or held • National legislations provide protection in form of injunction and damages if secret information is illegally acquired or used.However. part upfront and part % per production/sale. • Royalties can be upfront.7 billion (2002) Texas Instruments generated $ 3 billion in licensing in 10 years US and Canadian Universities generated $ 1.1 billion in royalties (2001) New York University $ 109 million (2004) Ohio University to get $52 M. only % per production/sale • The particular uses for which the IP can be used are also generally specified • Needs to be careful about the Competition law Is Licensing Profitable?Is Licensing Profitable?- • • • • • IBM revenue from patent licensing $ 1. International organisations-International Organizations in IP- • • World Intellectual Property Organisation World Trade Organisation IPR Licensing and technology transfer-Licensing of an IP- • • • • Licence is a permission granted by an IP owner to another person to use the IP on agreed terms and conditions. while he continues to retain ownership of the IP Licensing creates an income source It establishes a legal framework for transfer of technology to a wider group of researchers and engineers Creates market presence for the technology or trademark Licensing Conditions of IPRs- • Owners of IP prefer to transfer technology through licensing agreements only • All rights or limited rights can be licensed • Can be exclusive or non-excusive or sole (owner and licensee) • Most such agreements provide for royalty payment and non-transfer to a third party. From royalties on the growth hormone drug SOMAVERT in 5 years (2011) • CSIR $ 150 million in milestone payments + royalty 10) law copra Procedures relating to consumer complaints[sections 12 &13]- .line is necessary for commercial production of such other newly developed variety”. section 18 say that it will follow the same procedure as followed by District Forum with such modifications as necessary. However . the complaint shall not be rejected unless an opportunity of being heard has been given to the complaint. In case of complaint regarding deficiency in service there is no question of testing or analysis. Their composition is so made as to best represent the interests of the consumer dispute. However.2002(effective from 15th march. Note that earlier to the Amendment Act. A complaint may be with respect to the goods or services: When the complaint related to goods. and they have specified jurisdictions of their own.power to make rules regarding the procedure to be followed by the National commission was vested with the Central Government. Section 13 of the Act has detailed the procedure in context of District Forum only. The defect is obvious and is visible to naked eyes. in certain case defect can be determined without technical support or it may happen that the test is not feasible.2003). Now the question is-how to hold that the goods are defective? The most logical way is to get the goods tested to determine the defect. with all essential information. Cases when the laboratory testing may not be required or feasible: • • Where the laboratory test is required to determine the defect in the goods. and specifying the compensation demanded. or the National commission. They are: The opposite party admits the defect. the criteria for the decision is- • • • • • • • Whether the goods are defective or not. When subject-matter of the complaint gets destroyed. These copies are to be submitted. • Provisions of section13 discusses about the procedure to be followed by the District forum.consumer forums are the bodies who function like courts in order to settle the consumer disputes. Similary. Every complaint filed should be accompanied with such amount of fee and payable in such manner as may be prescribed. Procedure to be followed by the national commission[ Sec 22 & Sec 22a]. supporting papers like correspondence. For state commission. on the receipt of a complaint.matter of the complaint. Their composition is so much made as to best represent the interests of the consumers. When the complaint is not in possession of the subject. . (a) On receipt of a complaint: the district forum may allow the complaint to be proceeded with or rejected.section22 empowers the Nation Commission to make modifications in the procedure prescribed for the District Forum as per its needs. its remain cannot be send to the laboratory for testing. or the state commission. as the case may be. How a complaint is dealt by consumer forumA consumer is supposed to file as many copies of the complaint as there are judges. like in case a pressure cooker burst. Where no laboratory test is required to determine the defect in goods or the complaint relates to services under two sub-headings: How a complaint is dealt by consumer forums. (c) Every complaint shall be heard as expeditiously as possible and endeavour shall be made to decide the complaint within a period of 5 months in case laboratory testing is not required . the forum shall decide the dispute ex-party. or (3. authenticate it and refer the sample so sealed to the appropriate laboratory for an analysis or test. whichever may be necessary with a view to find out whether such goods suffer from any defects. or the method of analysis or test adopted by appropriate laboratory. 3) upon receiving laboratory reports. (h) The district forum shall issue an appropriate order after hearing the parties and taking into account the available evidence. Where the opposite party deny or dispute the allegation made in the complaint.) omits or fails to respond within the time given by the district forum Where the opposite party admits the allegations. (b) Within 21 days from the date of admission of complaint the District forum should refer a copy of such complaint to the opposite party directing him to give his version of the case within a period of 30 days which has been extended to 45 days. from the date of receipt of notice from the opposite party. the district forum would take the following steps to settle the disputes: (1) the district forum may require the complaint to deposit the specified fees for payment to the appropriate laboratory for carrying out the necessary analysis or test in relation to the goods in question. (g) Where during the pendency of any proceeding before the forum. (5) the district forum will give a opportunity of hearing to the objecting party. the district forum may either dismiss the complaint for default or decide it on merits. (e) where no laboratory test is required to determine the defect in goods or the complaint related to service. When the opposite party on receipt of a complaint refer to him admits the claim there is no contention and the forum will pass the appropriate order. The district forum will remit such fees to the appropriate laboratory to enable it to carry out required analysis or test. And no adjournment shall be ordinarily granted by the district forum unless sufficient cost is shown and the reasons for grant of adjournment have been recorded in writing by the forum.The admissibility of the complaint should ordinarily be decided within 21 days from the date on which complaint was received . the district forum will proceed to settle the dispute on the basis of evidence brought to its notice by both the parties. it appears to its necessary. the district forum will proceed to settle the ex-party on the basis of evidence brought to its notice by the complainant. (4) in the event of any party disputing the correctness of findings. the district forum should decide the matter on the basis of merits of the case and the documents before it. (2) the district forum will obtain a sample of the goods. (d) where the laboratory test is required to determine the defects in goods. it may pass such interim order as is just and proper in the fact and circumstances of the case.) admit the complaint (2. The opposite party on receipt of complaint referred to him may – (1. What is the appropriate laboratory under the Act Section 2(1)(a) of the act defines an” appropriate . the district forum shall require the objecting party to submit his objection in writing. Where the opposite party omits or fails to respond within the time given by the forum.) deny or disputes the allegations contained in the complaint. its copy will be forwarded by the district forum to the opposite party along with its own remarks. and where the opposite party omits or fail to take any actions. • But where the opposite party denies or disputes the allegations contained in the complaint or omits or fails to take any actions to represents his case within the time given by the district forum. seal it. (f) Where the complainant fails to appear on the date of hearing before the district forum. subject to such guidelines as may be prescribed by the central government or any such laboratory or organisation established by or under any law for the time being in force. (b) Discovery and production of any document or other material object producible evidence. which is maintained financed or aided by the central government or a state government for carrying out analysis or test of any goods with a view to determining whether such goods suffer from any defect. where an order is passed by the national commissions ex-parte against the opposite party or a complaint as the case may be . when there is an error apparent on the face of record. the aggrieved party may apply to the commission to set aside the said order in the interest of justice • Further . with such modifications be applicable to the disposal of disputes by the national commissions.with an endorsement to have been made by a postal employee or by any person authorised but the courier service to the effect that the opposite party or his agent or complainant had refused to take delivery of the postal article containing the notice or had refused to accept the notice by any other means when tendered or transmitted to him. Procedure to be followed by the national commission[section 22& 22A]- • • Section 22 of the act provides that the provisions of sections 12.laboratory” as a laboratory or organisation – • • Recognised by central government. POWERS OF THE CONSUMER FORUMS[SECTIONS 13(4). prepaid and duly sent by registered post acknowledgement has been lost or mislead. . the state commission or the national commission. the national commission shall have the power to review any order made by it. as the case may be shall declare that the notice has been duly served on the opposite party or to the complainant. (c) Receiving of evidence on affidavits.13 & 14 and rules made there under for the disposal of complaints by the district forum shall. SERVICE OF NOTICE[ SECTION28 A]- • • • • • The act has laid down certain rules with respect to service of notice: (a) the service of notices may be made by delivering or transmitting a copy there off the registered post acknowledgement duly addressed to opposite party against whom complaint is made or to the complaint by speed post or by such courier service as are approved by the district forum .14(1)&RULE 10]1)Powers akin to those of civil court [section 13]: The Consumer Forums are vested with the Civil Court powers with respect to the following: (a)Summoning and enforcing the attendance of any defendant or witness and examining the witness on oath.the state commission or the national commission . or for any other reason. within 30 days from the date of issue of notice. the forum shall declare that the notice has been duly served on the opposite party or to the complainant (d) where the notice was properly addressed. as the case may be . Recognised by state government. has not been received by the consumer forum. (c) when the postal article containing the notice is received back by consumer forum . or by any other means of transmission of documents( including fax message) (b) when an acknowledgement or any other receipt purporting to be signed by the opposite party or his agent or by the complaint is received by the district forum . the forum shall declare that the notice has been duly served on the opposite party or the complainant. or commodities from any person .the Forum is satisfied that the complainant suffer from any defect in goods or deficiency in service. 2.the State Commission and the District Forum have following additional powers: 1. papers. To return to the complainant the price. 5)Power to issue order[Section 14(1)] If. (e) Issuing of any commission for the examination of any witness. Summary trial means that the Forums need not consider any evidence.2003). To withdraw the hazardous goods and to desist from offering services which are hazardous in nature.documents. it may issue an order to the opposite party directing them to do one or more of the following things.documents. 3. As for the amount of damages .or as the case may be the charges paid by the complainant.(d) Requisitioning of the report of the concerned analysis or test from the appropriate laboratory or from any other relevant source.1973. 4)Additional powers of the consumer forums [Rule 10] The National Commission . namely: To remove the defect pointed out by the appropriate laboratory from the goods in question.1973. To discontinue the unfair trade practice or the restrictive trade practice or not to repeat it. • • • • • To remove the defects in goods or deficiencies in the service in question.examining and retaining them.commodities required for the purpose of proceedings under the Act. (f) The Forum may make such orders as to the costs occasioned by the adjournment as may be provided in the regulations made under this Act. after the proceedings . 3)Power to make summary judgement • The Consumer Forums have been granted power to try the cases on summary basis by the Amendment Act. To replace the goods with new goods of similar description which shall be free from any defect. To pay such sum as may be determined by it if it is of the opinion that loss or injury has been suffered by a large number consumers who are not identifiable conveniently. 2)Powers akin to those of criminal court [Section 27] • The Consumer Forums shall be deemed to be a Judicial Magistrate of the first class for the purpose of the Code of Criminal Procedure .It means that as to the consumer disputes dealt with by the Forums . (h) Any other matter which may be prescribed. To pay such amount as may be awarded by I as compensation to the consumer for any loss or injury suffered by the consumer due to the negligence of the opposite party.2002(effective from 15th March. Enter ans search any premises and seize from such premises books. . Obtaining information required for the purpose of the proceedings from any person.accounts.it may pass such interim order as is just and proper in the facts and circumstances of he case. (g) During the pendency of any proceedings before the Forum .they can use the powers which are granted to the first class judicial magistrate under the Code of Criminal Procedure.the Consumer Forum has the power to grant punitive damages as it deems fit. Requiring production off any books. they deal with the trial on the basis of affidavits given by the parties. Not to offer the hazardous goods for sale. • 33. However the Consumer Protection (Amendment) Act.one of whom must be the President .require that the disputes must be disposed of by atleast three members of the National Commission .7-3 Sitting of the National Commission –The Act is silent about the sitting requirement of the National Commission .has introduced the concept of Benches.For conducting any proceedings to resolve a consumer dispute . Thus it seems that the spirit of the Act supports the sitting of two members in total one of the whom must be the president.Every proceeding is required to be conducted by the president of the State Commission and at least one member thereof sitting together. SITTING OF THE FORUMS- • • 33.2002. the property attached may be sold and out of the proceeds thereof.1991.7-1 Sitting of the District Forum [Section 14(2)]. .powers and authority of the National Commission may be exercised by Benches thereof.has vested the Consumer Forums with the executory powers which they were lacking hitherto.at least two members of the forum must be there one of whom should be the president.• To issue corrective advertisement to neutralize the effect of misleading advertisement at the cost of the opposite party responsible for issuing such misleading advertisement.and when no appeal is instituted .2002. the Consumer Forum may award such damages as it thinks fit to the complainant and shall pay the balance . However . whereby the jurisdiction .the Consumer Forum may order for the attachment of the property of the person not complying with such order. Moreover it says that the rules regarding sitting are mandatory. (7) Regulatory powers [Section 30 A] The National Commission may. but the Consumer Protection (Amendment) Rules.7-2 Sitting of the State Commission. the person entitled to the amount may make an application to the forum. The order of a junior Forum is appealable with the senior Forum . A Bench may be constituted b the President with one or more members as the President may deem fit.the law has prescribed certain norms as to the signing of orders without complying which the orders cannot be made. if any to the party entitled thereto. 33.is capable of passing a valid order. Any failure to comply with the same may invalidate the order.the order is final. b) If the non-compliance of such attachment order continues for more than three months. with the previous approval of the Central Government by notification . c) here under an order made by a Consumer Forum any amount is due from any amount is due from any person. and such may issue a certificate for the said amount to the Collector of the district and the Collector shall proceed to recover the amount in the same manner as arrears of land revenue. ORDERS OF THE FORUMS- • The orders of the Consumer Forums are like orders of the Civil Court and are enforceable like a decree of the court.These are discussed belowWhere an interim order made under this Act is not compiled with. Executory Powers [Section 25] • • The Amendment Act . • To provide for adequate costs to parties.make regulations not inconsistent with this Act to provide for all matters for which provision is necessary or expedient for the purpose of giving effect to the provisions of this Act. or the National Commission may be enforced in the same manner as if it were a decree of the court. If there is difference of opinion between any two members.such order shall be final.the District Forum . 3.or State Commission.or the National Commission . 2.the trader .the opinion of the majority shall be the order of the Commission.or the National Commission .000.matter should be referred to the third member for a decision.or State Commission .or With fine ranging between Rs.000 and Rs. or With both.Signing of orders of the Forums- • • (1) District forum Section 14(2A) provides that every order made by the District Forum shall be signed by its President and the member or members who conducted the proceeding. 10.or complainant. matter should be referred to the third member for a decision . • In the context of Consumer Forums1. . An appeal can be made with the National Commission against the order of the State Commission within 30 days of the order or within such time as the National Commission allows. Penalties for non-compliance of orders- • • • • • Every order made by the District Forum .[Section 25] All the persons. If there is difference of opinion between any two members .or the opposite party are supposed to comply with the orders of the District Forum . Thus any order passed by a single member of the District Forum is not warranted. And the decision of the majority would be final.When any such person fails or omits to comply with the order .And the decision of the majority would be final. Appeals against orders- • ‘Appeal ‘ is a legal instrumentality whereby a person not satisfied with the findings of a court has an option to go to a higher court to present his case and seek justice.or State Commission .and in case of any difference of opinion . An appeal can be made with the State Commission against the order of the District Forum within 30 days of the order which is extendable for further 15 days. • (2) State Commission – Every order made by the National Commission must be signed by its President and the member or members who conducted the proceeding. Finality of orders • Where no appeal has been preferred against the order made by the District Forum . An appeal can be made with the Supreme Court against the order of the National Commission within 30 days of the order or within such time as the Supreme Court allows.or State Commission . may punish him withImprisonment for a term ranging between one month and three years .and at least two members who conducted the proceeding . or the National Commission as the case may be. (3) National Commission –Every order made by the National Commission must be signed by the President .2.