TaxTMI 
TaxTMI 
2022 (7) TMI 1545
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....e interim orders which, according to the plaintiff may be dealt with at the time of final disposal of the interlocutory application. Therefore, the consideration is restricted to the above point and the competence and jurisdiction of the Court to embark its journey to such so-called difficult terrain beyond the conceivable limits and jurisdiction bestowed upon it under the law. The prelude to the litigation is required to be adumbrated and ensued when the plaintiff-appellant advanced a sum of Rs. 65 lakhs through bank transactions in favour of the defendant-respondent with clear stipulation that the aforesaid amount is repayable together with an interest at the rate of 12 per cent per annum. The aforesaid amount was lent and advanced on diverse dates between 18th January, 2020 and 18th September, 2020 corroborated with the documentary evidence more particularly, the bank statement of the plaintiff's bank account. It is undeniable that the part payment to the tune of Rs. 1,37,650/- was made on 10th October, 2020 on account of the repayment of interest and the TDS was also deducted of the specified amount from time to time during the Financial Year 2019-2020 and 2020-2021. The suit ....
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....nt vociferously submits that the pleading of the parties are the important facets of adjudication of the disputes in adversial system and the Court cannot travel beyond the four corners thereof in passing a direction which is uncalled for and unwarranted. He further submits the field of public policy originating from a common law cannot be expanded, more particularly in a civil suit beyond the procedural law and the provisions contained therein. According to him, public policy principles can only be expounded through a judicial precedents as opposed to the expansion of his horizon based upon a perception of a Judge having a larger impact both in a positive or negative way. In support of the aforesaid contention, Mr. Sahni relies upon a Constitution Bench decision rendered in case of Gherulal parakh vs. Mahadeo Das Maiya & Ors. reported in AIR 1959 SC 781. It is further submitted that the doctrine of public policy can be activated only in case of a breach of a common law and does not ipso facto invalidate the contract. Mr. Sahni arduously submits that although the principles governing the public policy is capable of an expansion or modification but such principles are guided by the....
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....blic policy principles is not unbrindled and/or unfettered but are guided by the precedents and may only apply in case of the contract being forbidden by law or any incident perceived under Section 23 of the Contract Act. Such power can be exercised with the restricted modification and not on an individual's perception. He thus submits that the impugned order so far as it relates to the direction upon the authority to investigate and submit the report to the Court is illegal and cannot be sustained. Mr. Anirban Ray, the learned Government Pleader submits that the inherent power contained under Section 151 of the Code of Civil Procedure cannot be exercised to override the substantive rights of the litigant nor should pass an order directing the Commissioner to seize the books of accounts beyond the subject matter of the suit. He further submits the inherent power cannot be exercised to invade the private rights of the parties as held by the Supreme Court in case of Padam Sen & Anr. Vs. State of UP reported in AIR 1961 SC 218. He further submits that power exercised by the Court must be within the strict four corners of the pleadings and not beyond it. He thus submits that in a civi....
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.... capable of being moulded with the change in policy. The concept of the tax charged from the citizenry is since the advent of the monarchy and have been engulfed in a democratic polity as well as the Constitution adopted by the people of this country. The broad concept of imposition of tax in a commercial dealing or otherwise is to facilitate the Ruling Government in development of the society or the country in many spheres. The public policy varied with the political decisions and sometimes what may not be the public policy at one point of time becomes a policy. Broadly the public policy is considered to be the principles and standards regarded by the legislature or by the Courts as being of fundamental concern to the state and whole of the society and can be succinctly in a narrower sense may imbibe a principle that a person should not be allowed to do anything that would tend to injure the public at large. The Apex Court in case of Gherulal Parakh (Supra) was considering a matter whether the wagering contract can be struck down on the ground of public policy. The Apex Court held that though the concept of public policy is comprehensive and measured on a political, social and ec....
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..... It is equally true that such concept is well recognised in the Indian judicial parlance and, therefore, have expanded his horizon through a judicial precedents or a common law. The Apex Court in Central Inland Water Transport Corporation (Supra) succinctly held that the public policy connotes such matter which concerned the public good and the public interest capable of being varied from time to time depending upon the policies of the welfare state. There has been a divergence of views on the concept of public policies as one school of thought perceived such policy in a narrower way; the other have expanded it in a more broader manner. The Apex Court held that underlining the public policy must be capable of expansion or modification on the proper occasions and in absence of any legal precedent the only guiding factor that should weigh to the Court is the principle underlying the fundamental rights and the directive principles enshrined in the Constitution in these words: "It is thus clear that the principles governing public policy must be and are capable, on proper occasion, of expansion or modification. Practices which were considered perfectly normal at one time have today....
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....t prevail. The types of contracts to which the principle formulated by us above applies are not contracts which are tainted with illegality but are contracts which contain terms which are so unfair and unreasonable that they shock the conscience of the court. They are opposed to public policy and require to be adjudged void." In Gurmukh Singh vs. Amar Singh reported in (1991) 3 SCC 79 the Apex Court taking aid of Section 23 of the Contract Act held that if the Court finds that the agreement is opposed to public policy it is void under the aforesaid provision. The Apex Court succinctly held that the word 'object' appearing in the said section would mean the purpose and design being the object of the contract if opposed to public policy tending to defeat the provision of law or the purpose of law for which it becomes unlawful. Even after having said so, the Apex Court held if the intention is to defeat the right of a third party or a Government, such contract would fall under the mischief of the aforesaid provision and there is no fetter on the part of the Court in applying the principle of the public policies in the following: "3. In Chandra Sreenivasa Rao v. Korrapati Raja R....
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....to good government either in the field of domestic or foreign affairs; thirdly, objects which interfere with the proper working of the machinery of justice; fourthly, objects injurious to marriage and morality; and, fifthly, objects economically against the public interest.' " In Paragraph 7 of the said report the Apex Court held that the concept of public policy is not static or rigid but varied with the changing times and the need of the society in these words: "7. The ratio in Kayjay Industries (p) Ltd. v. Asnew Drums (P) Ltd. is of no assistance to the appellant. Therein the executing court, on the previous occasion, with a view to secure better price did not confirm the sale, the conduct of the second sale, therefore, was held not to be vitiated by any material irregularity. The general principles of public policy discussed by this Court in Central Inland Water Transport Corpn. Ltd. v. Brojo Nath Ganguly and one of us (K. Ramaswamy, J.) in Delhi Transport Corporation v. D.T.C. Mazdoor Congress are of no assistant on the facts in this case. The public policy is not static. It is variable with the changing times and the needs of the society. The march of law must match with ....
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....tein Consolidated Mines Ltd., AC at p. 500: 'Public policy is always an unsafe and treacherous ground for legal decision.' That was in the year 1902. Seventy-eight years earlier, Burrough, J., in Richardson v. Mellish, Bing at p. 252; ER at p. 303; All ER Rep at p. 266 described public policy as 'a very unruly horse, and when once you get astride it you never know where it will carry you'. The Master of the Rolls, Lord Denning, however, was not a man to shy away from unmanageable horses and in words which conjure up before our eyes the picture of the young Alexander the Great taming Bucephalus, he said in Enderby Town Football Club Ltd. v. Football Assn. Ltd., Ch p. 660: 'With a good man in the saddle, the unruly horse can be kept in control. It can jump over obstacles.' Had the timorous always held the field, not only the doctrine of public policy but even the common law or the principles of Equity would never have evolved. Sir William Holdsworth in his History of English Law, Vol. III, p. 55, has said: 'In fact, a body of law like the common law, which has grown up gradually with the growth of the nation, necessarily acquires some fixed principles, and if it is to maintain the....
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.... Taxes to investigate into the monetary dealing and submit the report before the Court. At the very outset, we must record that there is no reflection of any extraneous facts in the plaint or an application filed by the plaintiff- appellant. However, the defendant took a very unusual defence that it was not a real transaction but ostensible one in the guise of the accommodated entry or a "Jamma Kharji". Such defence can be viewed as an evasion of the tax and conversion of an illegal thing to a legal. Broadly, concept of imposition of tax by the welfare state and providing facilities and amenities as well as the development of the society and the country largely depend upon the same whether the defendant would be able to prove such fact is a matter to be decided after a full-fledged trial. Equally this Court cannot overlook such defence if taken to be prima facie correct having an impact on the public at large and invasion impacted the welfare state and its resources required for development of the country both economically and otherwise. Will the Judge still confine to a pleading and the reliefs claimed therein having noticed the aforesaid fact discerned from the record traces its....