Saturday, December 14, 2013

Section 377 IPC and the Verdict of the Supreme Court


          The Supreme Court’s judgment on Section 377 IPC has driven the LGBT (Lesbian Gay Bisexual Transgender) activists into a rebellious mood.
        What does Section 377 IPC say?  It states as follows:-
377. Unnatural offences: Whoever voluntarily has carnal intercourse against the order of nature with any man, woman or animal shall be punished with imprisonment for life, or with imprisonment of either description for a term which may extend to ten years, and shall also be liable to fine.
Explanation: Penetration is sufficient to constitute the carnal intercourse necessary to the offense described in this section”
         Homosexuals are clearly not the targets. The section clearly mentions "whosoever" and "man, woman or animal". If one looks into the history of convictions under this section, it can be seen that there has been no case of a consensual homosexual act being prosecuted / convicted under this law. 

        Now, let us see the definition of  ‘rape’ under Section 375 IPC.
 “375. Rape: A man is said to commit  ‘rape’ who, except in the case hereinafter excepted, has sexual intercourse with a woman under circumstances falling under any of the six following descriptions:- First.- Against her will. Secondly.- Without her consent. Thirdly.- With her consent, when her consent has been obtained by putting her or any person in whom she is interested in fear of death or of hurt. Fourthly.- With her consent, when the man knows that he is not her husband, and that her consent is given because she believes that he is another man to whom she is or believes herself to be lawfully married. Fifthly.- With her consent, when, at the time of giving such consent, by reason of unsoundness of mind or intoxication or the administration by him personally or through another of any stupefying or unwholesome substance, she is unable to understand the nature and consequences of that to which she gives consent. Sixthly.- With or without her consent, when she is under sixteen years of age.
Explanation.- Penetration is sufficient to constitute the sexual intercourse necessary to the offence of rape.
 Exception.- Sexual intercourse by a man with his own wife, the wife not being under fifteen years of age, is not rape.”
       A man cannot commit rape on another man.  Nowadays we often hear school boys being forced to have sex with male teachers, male inmates of hostels being subjected to such behavior by male members of the staff, male employees being subjected to similar behavior by employers.  Section 375 will not apply to such cases.  It is only Section 377 that will apply to such cases. 
       Offence under Section 377 is a cognizable offence.  Under Section 154 of the Code of Criminal Procedure, “every information relating to the commission of a cognizable offence, if given orally to an officer in charge of a police station, shall be reduced to writing by him or under his direction, and be read over to the informant; and every such information, whether given in writing or reduced to writing as aforesaid, shall be signed by the person giving it, and the substance thereof shall be entered in a book to be kept by such officer in such form as the State Government may prescribe in this behalf.”  The police officer will register the First Information Receipt (FIR) on receipt of a complaint.  In the case of consensual sexual act in private, there is no question of giving any complaint and therefore no FIR will be registered.  Unless one of the parties gives a complaint alleging unnatural offence no action can be taken.  Even in the case of married couple, if one subjects the other to unnatural sexual act against the will of the other, the other party can file a complaint for offence under Section 377. 
         The movement to repeal Section 377 was initiated by AIDS Bhedbhav Virodhi Andolan in 1991. Their publication “Less than Gay: A Citizen's Report” dealt with Section 377 and asked for its repeal. The Naz Foundation (India) Trust, an activist group, filed a  public interest litigation (PIL) in the Delhi High Court in 2001, seeking legalisation of homosexual intercourse between consenting adults.  However, in 2003, the Delhi High Court refused to consider the petition regarding the legality of the law saying that the petitioners had no locus standi in the matter. Naz Foundation appealed to the Supreme Court against the decision of the High Court dismissing the petition on technical grounds. The Supreme Court decided that Naz Foundation had the locus standi to file a PIL in this case and sent the case back to the Delhi High Court to reconsider it on merit. Subsequently, there was a significant intervention in the case by a Delhi-based coalition of LGBT, women's and human rights activists called “Voices Against 377”, which supported the demand to 'read down' section 377 to exclude adult consensual sex from its purview.
           On 2-7-2009, the Delhi High Court held as follows:-
          “We declare that Section 377 IPC, in so far as it criminalises consensual sexual acts of adults in private, is violative of Articles 21, 14 and 15 of the Constitution.   The provisions of Section 377 IPC will continue to govern non consensual penile and non-vaginal sex and penile non-vaginal sex involving minors. By ‘adult’,  we mean everyone who is 18 years of age and above. A person below 18 would be presumed not to be able to consent to a sexual act. This clarification will hold till, of course, Parliament chooses to amend the law to effectuate the recommendation of the Law Commission of India in its 172nd Report which we believe removes a great deal of confusion. Secondly, we clarify that our judgment will not result in the re-opening of criminal cases involving Section 377 IPC that have already attained finality.”
           The order of the High Court was challenged by a large number of organizations and individuals including Joint Action Council, Kannur and Shri B.P.Singhal who were interveners before the High Court by filing Special Leave Petitions in the Supreme Court of India.  During the pendency of the SLP, several individuals and organisations filed applications for permission to intervene and all the applications were allowed.
          On December 11, 2013 the Supreme Court upheld the constitutional validity of Section 377 IPC in the following terms:
         “Those who indulge in carnal intercourse in the ordinary course and those who indulge in carnal intercourse against the order of nature constitute different classes and the people falling in the latter category cannot claim that Section 377 suffers from the vice of arbitrariness and irrational classification. What Section 377 does is merely to define the particular offence and prescribe punishment for the same which can be awarded if in the trial conducted in accordance with the Code of Criminal Procedure and other statutes of the same family the person is found guilty.  Therefore, the High Court was not right in declaring Section 377 IPC ultra vires Articles 14 and 15 of the Constitution. …..
        While reading down Section 377 IPC, the Division Bench of the High Court overlooked that a miniscule fraction of the country’s population constitute lesbians, gays, bisexuals, or transgenders and in the last more than 150 years less than 200 persons have been prosecuted (as per the reported orders) for committing offence under Section 377 IPC and this cannot be made sound basis for declaring that section ultra vires the provisions of Articles 14,15 and 21 of the Constitution…..
        It is well settled that the mere possibility of abuse of provision of law does not, per se, invalidate a legislation. It must be presumed, unless contrary is proved, that administration and application of a particular law would be done “not with an evil eye and unequal hand”. ……
      We hold that Section 377 does not suffer from the vice of unconstitutionality and the declaration made by the Division Bench of the High Court is legally unsustainable….
      While parting with the case, we would like to make it clear that this court has merely pronounced on the correctness of the view taken by the Delhi High Court on the constitutionality of Section 377 IPC and found that the said section does not suffer from any constitutional infirmity.  Notwithstanding this verdict, the competent legislature shall be free to  consider the desirability and propriety of deleting Section 377 IPC from the statute book or amend the same as per the suggestion made by the Attorney General.”
       What else could the Supreme Court have done? It is for the Parliament to amend the law in accordance with the Constitution of India.

Sunday, June 30, 2013



What is a Community Certificate?  A Community  Certificate is the proof of one’s belonging to a particular caste, especially in case one belongs to any of the ‘Scheduled Castes’, ‘Scheduled Tribe’ and the Backward Class as specified in the Indian Constitution. The Government felt that the Scheduled Castes and Tribes need special encouragement and
opportunities to progress at the same pace as the rest of the citizenry. As a result, as part of the Indian system of Protective Discrimination, there exist certain special privileges granted to this category of citizens, such as reservation of seats in the Legislatures and in the Government Service, waiving off a part or the whole of the fees for admission to schools and colleges, quotas in educational institutions, relaxation of upper age limits for applying to certain jobs, etc. To be able to avail the privileges reserved for a particular caste, a citizen belonging to the caste must be in possession of a valid Caste Certificate.
Article 338 of the Constitution of India mandates the constitution of a National Commission for Scheduled Castes and Article 338A mandates the constitution of a National Commission for Scheduled Tribes.  It is evident from Article 338 as it originally stood, that the Commission was constituted to protect and safeguard the persons belonging to scheduled castes and scheduled tribes by ensuring : (i) anti- discrimination, (ii) affirmative action by way reservation and empowerment, and (iii) redressal of grievances. The duties under clause 5(b) of Article 338 did not extend to either issue of caste/tribe certificate or to revoke or cancel a caste/tribe certificate or to decide upon the validity of the caste certificate. Having regard to the sub-clause (b) of clause (5) of Article 338, the Commission could no doubt entertain and enquire into any specific complaint about deprivation of any rights and safeguards of Scheduled Tribes. When such a complaint was received, the Commission could enquire into such complaint and give a report to the Central Government or State Government requiring effective implementation of the safeguards and measures for the protection and welfare and socio-economic development of scheduled tribes. This power to enquire into `deprivation of rights and safeguards of the scheduled castes and scheduled tribes' did not include the power to enquire into and decide the caste/tribe status of any particular individual. In fact, as there was no effective mechanism to verify the caste/tribe certificates issued to individuals, the Supreme Court of India in Madhuri Patil vs. Addl. Commissioner (Tribal Development) - 1994 (6) SCC 241 directed constitution of scrutiny committees.
The  Supreme Court held that on account of false social status certificates being obtained by unscrupulous individuals, and cornering the benefits meant for SCs and STs, persons who genuinely belonged to scheduled castes/scheduled tribes were denied the benefit of reservation in posts/seats and other benefits extended to SCs and STs. It therefore, felt that there was a need to streamline the procedure for issuance of social status certificate, their scrutiny and approval and issued the following directions : (1) The application for grant of social status certificate shall be made to the Revenue-Sub-Divisional Officer and Deputy Collector or Deputy Commissioner and the certificate shall be issued by such Officer rather than at the Officer, Taluk or Mandal level.  (2) All the State Governments shall constitute a Committee of three officers, namely, (I) an Additional or Joint Secretary or any officer higher in rank of the Director of the concerned department, (II) the Director, Social Welfare/Tribal Welfare/Backward Class Welfare, as the case may, and (III) in the case of Scheduled Castes another officer who has intimate knowledge in the verification and issuance of the social status certificates. In the case of the Scheduled Tribes, the Research Officer who has intimate knowledge in identifying the tribes, tribal communities, parts of or groups of tribes or tribal communities. (3)  Each Directorate should constitute a vigilance cell consisting of Senior Deputy Superintendent of Police in over all charge and such number of Police Inspectors to investigate into the social status claims. The Inspector would go to the local place of residence and original place from which the candidate hails and usually resides or in case of migration to the town or city, the place from which he originally hailed from. The vigilance officer should personally verify and collect all the facts of the social status claimed by the candidate or the parent or guardian, as the case may be. He also should examine the school records, birth registration, if any. He should also examine the parent, guardian or the candidate in relation to their caste etc. or such other persons who have knowledge of the social status of the candidate and then submit a report to the Directorate together with all particulars as envisaged in the proforma, in particular, of the Scheduled Tribes relating to their peculiar anthropological and ethnological traits, deities, rituals, customs, mode of marriage, death ceremonies, method of burial of dead bodies etc. by the concerned castes or tribes or tribal communities etc. (4) On receipt of the report from the vigilance officer  the entire matter should be placed before the Scrutiny Committee and the Committee should issue show cause notice supplying a copy of the report of the vigilance officer to the candidate by  registered post with acknowledgement due or through the head of the concerned educational institution in which the candidate is studying or employed. The inquiry should be completed as expeditiously as possible preferably by day-to-day proceedings within such period not exceeding two months. If after inquiry, the caste Scrutiny Committee finds the claim to be false or spurious, they should pass an order cancelling the certificate issued and confiscate the same. It should communicate within one month from the date of the conclusion of the proceedings the result of enquiry to the parent/guardian and the applicant.
 The Supreme Court thus formulated a scheme for verification of tribal status and held that any application for verification of tribal status as a scheduled tribe should be carried out by such Committees. The verification of the validity of caste certificates and determination of the caste status should therefore be done by the Scrutiny Committees constituted as per the directions in Madhuri Patil or in terms of any statute made by the appropriate government in that behalf.

Sunday, June 23, 2013


 - P. Rajendran

                “If any couple, subject to their attaining the mandatory age of freedom,  indulge in sexual gratification, then that would be considered as valid marriage and they could be termed as “husband and wife”, as a result of their choice of freedom.  Marriage formalities as per various religious customs such as  the tying of a mangalsutra, the exchange of garlands and rings or the registering of a marriage are  only to comply with religious customs for the satisfaction of society”.  This ruling by Mr. Justice C. S. Karnan of  
 the Madras High Court has sparked humorous reactions across the Internet and a heated debate over the fundamental relationship between a man and a woman.  Two days after he gave the nation-jolting order interpreting any consensual sex between majors as marriage, Justice C.S. Karnan came out with an interesting  modification of his earlier judgment to clarify his intent and said :  “If a bachelor aged 21 years or above and a spinster aged 18 years or above had pre-marital sex, with intention to marry and subsequent to this the man deserts the woman, the victim woman can approach a civil forum for remedy after producing necessary substantial evidence to grant her social status as wife”.  The Judgment was delivered in a case of maintenance claim under Section 125 of the Code of Criminal Procedure, 1973.
        Sir James Fitz Stephen, who piloted the Criminal Procedure Code of 1872, a legal member of Viceroy's Council, described the object of Section 536 of the Code (Section 125 of the Code of Civil Procedure, 1973 is a reincarnation of Section 536 and Section 488 of the Code of 1898)  as a mode of preventing vagrancy or at least preventing its consequences. In the1898 Code the same provision was incorporated in Section 488 as follows:
“ (1) If any person having sufficient means neglects or refuses to maintain his wife or his legitimate or illegitimate child unable to maintain itself, the District Magistrate, a Presidency Magistrate, a Sub-divisional Magistrate or a Magistrate of the first class may, upon proof of such neglect or refusal, order such person to make a monthly allowance for the maintenance of his wife or such child, at such monthly rate, not exceeding five hundred rupees in the whole as such Magistrate thinks fit, and to pay the same to such person as the Magistrate from time to time directs.”
As per the above provision of law, a “wife” is entitled for maintenance.  Now, the question is: who is a wife? 
In Lieutenant C.W. Campbell v. John A.G. Campbell [(1867) Law Rep. 2 HL 269], also known as the Breadalbane case, the House of Lords held that cohabitation, with the required repute, as husband and wife, was proof that the parties between themselves had mutually contracted the matrimonial relation. A relationship which may be adulterous at the beginning may become matrimonial by consent. This may be evidenced by habit and repute. The House of Lords again observed in Captain De Thoren v. The Attorney-General [(1876) 1 AC 686], that the presumption of marriage is much stronger than a presumption in regard to other facts.
       In India, the same principles have been followed in the case of A. Dinohamy v. W.L. Balahamy [AIR 1927 P.C. 185], in which the Privy Council laid down the general proposition that where a man and woman are proved to have lived together as man and wife, the law will presume, unless, the contrary is clearly proved, that they were living together in consequence of a valid marriage, and not in a state of concubinage. In the case of Gokal Chand v. Parvin Kumari [AIR 1952 SC 231], the Hon’ble Supreme Court of India held that continuous co- habitation of man and woman as husband and wife may raise the presumption of marriage, but the presumption which may be drawn from long co- habitation is rebuttable and if there are circumstances which weaken and destroy that presumption, the Court cannot ignore them.  Further, in the case of Badri Prasad  Vs  Dy. Director of Consolidation & others [(1978) 3 SCC 527], the Supreme Court held that a strong presumption arises in favour of wedlock where the partners have lived together for a long spell as husband and wife. Although the presumption is rebuttable, a heavy burden lies on him who seeks to deprive the relationship of legal origin. Again, in Tulsa and others Vs  Durghatiya  and  others [2008 (4) SCC 520], the Supreme  Court held that where the partners lived together for a long spell as husband and wife, a presumption would arise in favour of a valid wedlock.
     In Nanak Chand v. Chandra Kishore Aggarwal & Ors. [1969 (3) SCC 802], the Supreme Court, discussing Section 488 of the older Cr.P.C, virtually came to the same conclusion that Section 488 provides a summary remedy and is applicable to all persons belonging to any religion and has no relationship with the personal law of the parties. Section 125 is a reincarnation of Section 488 of the Cr.P.C. of 1898 except for the fact that parents have also been brought into the category of persons entitled for maintenance. In Vimala (K) Vs  Veeraswamy (K) [(1991) 2 SCC 375], a three-Judge Bench of the Hon’ble Supreme Court held that Section 125 of the Code of 1973 is meant to achieve a social purpose and the object is to prevent vagrancy and destitution. Explaining the meaning of the word `wife' the Court held: “The object is to prevent vagrancy and destitution. It provides a speedy remedy for the supply of food, clothing and shelter to the deserted wife. When an attempt is made by the husband to negative the claim of the neglected wife depicting her as a kept-mistress on the specious plea that he was already married, the court would insist on strict proof of the earlier marriage. The term `wife' in Section 125 of the Code of Criminal Procedure, includes a woman who has been divorced by a husband or who has obtained a divorce from her husband and has not remarried. The woman not having the legal status of a wife is thus brought within the inclusive definition of the term `wife' consistent with the objective.  Thus, in those cases where a man, who lived with a woman for a long time and even though they may not have undergone legal necessities of a valid marriage, should be made liable to pay the woman maintenance if he deserts her. The man should not be allowed to benefit from the legal loopholes by enjoying the advantages of a de facto marriage without undertaking the duties and obligations. Any other interpretation would lead the woman to vagrancy and destitution, which the provision of maintenance in Section 125 is meant to prevent”.
       However,  in Yamunabai Anantrao Adhav v. Anantrao Shivram Adhav and another, reported in AIR 1988 SC 644, a two-Judge Bench of the Supreme Court held that an attempt to exclude altogether personal law of the parties in proceedings under Section 125 is improper and the learned Judges also held that the expression `wife' in Section 125 of the Code should be interpreted to mean only a legally wedded wife. Again in a subsequent decision of the Supreme Court in Savitaben Somabhat Bhatiya v. State of Gujarat and others, reported in AIR 2005 SC 1809, the Supreme Court held that however desirable it may be to take note of plight of an unfortunate woman, who unwittingly enters into wedlock with a married man, there is no scope to include a woman not lawfully married within the expression of `wife'. The Bench held that this inadequacy in law can be amended only by the Legislature. While coming to the aforesaid finding the learned Judges relied on the decision in the Yamunabai case (supra).
        The Committee on Reforms of Criminal Justice System, headed by Dr. Justice V.S. Malimath, in its report of 2003 opined that evidence regarding a man and woman living together for a reasonably long period should be sufficient to draw the presumption that the marriage was performed according to the customary rites of the parties. Thus, it recommended that the word `wife' in Section 125 Cr.P.C. should be amended to include a woman who was living with the man like his wife for a reasonably long period. This amendment has not been made till now.
     It is, therefore, clear from what has been discussed above that there is a divergence of judicial opinion on the interpretation of the word `wife' in Section 125 of the Code of Criminal Procedure, 1973.
      The law in America has proceeded on a slightly different basis. The social obligation of a man entering into a live-in relationship with another woman, without the formalities of a marriage, came up for consideration in the American courts in the leading case of Marvin v. Marvin [(1976) 18 Cal.3d 660]. In that context, a new expression of `palimony' has been coined, which is a combination of `pal' and `alimony', by the famous divorce lawyer in the said case, Mr. Marvin Mitchelson.  In this case, the plaintiff, Michelle Marvin, alleged that she and Lee Marvin entered into an oral agreement which provided that while the parties lived together they would combine their efforts and earnings and would share equally any and all property accumulated as a result of their efforts whether individual or combined and the parties further agreed that Michelle would render her services as a companion, homemaker, housekeeper and cook. Michelle sought a judicial declaration of her contract and property rights, and sought to impose a constructive trust upon one half of the property acquired during the course of the relationship. The Supreme Court of California held as follows:
(1) The provisions of the Family Law Act do not govern the distribution of property acquired during a non-marital relationship; such a relationship remains subject solely to judicial decision.  (2) The courts should enforce express contracts between non-marital partners except to the extent that the contract is explicitly founded on the consideration of meretricious sexual services. (3) In the absence of an express contract, the courts should inquire into the conduct of the parties to determine whether that conduct demonstrates an implied contract, agreement of partnership or joint venture, or some other tacit understanding between the parties. The courts may also employ the doctrine of quantum meruit, or equitable remedies such as constructive or resulting trusts, when warranted by the facts of the case.
      In our country, law has not developed on the lines of the Marvin case.  However, the Protection of Women from Domestic Violence Act, 2005 assigns a very broad and expansive definition to the term `domestic abuse' to include within its purview even economic abuse. `Economic abuse' has been defined very broadly in sub-explanation (iv) to explanation I of Section 3 of the said Act to include deprivation of financial and economic resources. Section 20 of the Act allows the Magistrate to direct the respondent to pay monetary relief to the aggrieved person, who is the harassed woman, for expenses incurred and losses suffered by her, which may include, but is not limited to, maintenance under Section 125 Cr.P.C. [Section 20(1)(d)]. Section 22 of the Act confers upon the Magistrate, the power to award compensation to the aggrieved person, in addition to other reliefs granted under the Act. In terms of Section 26 of the Act, these reliefs mentioned above can be sought in any legal proceeding, before a civil court, family court or a criminal court, affecting the aggrieved person and the respondent. Most significantly, the Act gives a very wide interpretation to the term `domestic relationship' as to take it outside the confines of a marital relationship, and even includes live-in relationships in the nature of marriage within the definition of `domestic relationship' under Section 2(f) of the Act. Therefore, women in live-in relationships are also entitled to all the reliefs given in the said Act.  If the abovementioned monetary relief and compensation can be awarded in cases of live-in relationships under the Act of 2005, they should also be allowed in a proceedings under Section 125 of Cr.P.C.  In light of the constant change in social attitudes and values, which have been incorporated into the forward-looking Act of 2005, the same needs to be considered with respect to Section 125 of Cr.P.C. and a broad interpretation of the same should be taken.
       In fact a two judge Bench of the  Hon’ble Supreme Court of India, in the case of  Chanmuniya Vs Virendra Kumar Singh Kushwaha,  has requested the Hon'ble  Chief Justice  of India to refer the following questions to be decided by a larger Bench:
“1. Whether the living together of a man and woman as husband and wife for a considerable period of time would raise the presumption of a valid marriage between them and whether such a presumption would entitle the woman to maintenance under Section 125 Cr.P.C?
2. Whether strict proof of marriage is essential for a claim of maintenance under Section 125 Cr.P.C. having regard to the provisions of Domestic Violence Act, 2005?
3. Whether a marriage performed according to customary rites and ceremonies, without strictly fulfilling the requisites of Section 7(1) of the Hindu Marriage Act, 1955, or any other personal law would entitle the woman to maintenance under Section 125 Cr.P.C.?”
       Therefore, whether  a broad and expansive interpretation should be given to the term `wife' to include even those cases where a man and woman have been living together as husband and wife for a reasonably long period of time, and strict proof of marriage should not be a pre-condition for maintenance under Section 125 of the Cr.P.C, so as to fulfill  the true spirit and essence of the beneficial provision of maintenance under Section 125 has to be decided by the larger Bench of the Supreme Court of India.
        The judgment of Mr. Justice Karnan that if any couple, subject to their attaining the mandatory age of freedom, indulge in sexual gratification, then that would be considered as valid marriage and they could be termed as “husband and wife” should be examined in the light of the above cited decisions of the Supreme Court of India.  The settled legal position is that a strong presumption arises in favour of wedlock where the partners have lived together for a long spell as husband and wife and even this presumption is a rebuttable presumption.  In the case before Mr. Justice Karnan, the parties lived together for a long time and therefore he was perfectly right in upholding the claim of the woman who claimed maintenance.  But his judgment goes beyond that and states that if any couple, subject to their attaining the mandatory age of freedom, indulge in sexual gratification, then that would be considered as valid marriage is not in line with the above cited decisions of the Supreme Court of India particularly when he has not clarified whether the rule laid down relates to sustained cohabitation or just sexual consummation.

Tuesday, January 15, 2013



              What is a franchise business?   It is a business in which the owners, or franchisers, sell the rights to their business logo and model to third parties, called franchisees. Examples of well-known franchise business models include Baskin Robbins, Subway, McDonald's, TGI Friday's, Taco Bell, Pizza Hut, Dominos Pizza, Ruby Tuesdays, Barista, Costa, Wetzel Pretzel, Papa John's and KFC.  Beauty and Health Care Fitness clubs such as VLCC and Talwalkers have established chains while hair and beauty salons offering domestic branded products including Shanaz Hussein, Biotique and Habibs, and international brands, for example, L'Oreal and Tony & Guy, have marked their presence through the franchise model.
          There are many different types of franchises. Many people associate only fast food businesses with franchising. In fact, there are over 120 different types of franchise businesses available today, including automotive, cleaning & maintenance, health & fitness, financial services, and pet-related franchises, just to name a few. Franchising has become one of the most popular ways of doing business in today's marketplace.
 Franchise business opportunities are available across a variety of industries in India. Today, India is one of the biggest emerging markets for various goods and services, ranging from bare necessities to expensive luxuries. After the  coming into force of the Foreign Exchange Management Act, 1999 (FEMA), foreign investors found their passage into India with rules for entry becoming far more favourable. Today, a convenient medium of entry by foreign companies into the Indian market is franchising. Franchising also exists as a successful business module for local companies in India within various sectors

How to start a franchise business in India?  To invest in a franchise, the franchisee must first pay an initial fee for acquiring the rights to the business, training, and the equipment required by that particular franchise. Thereafter, the franchisee will generally pay the franchise business owner an ongoing royalty payment, either on a monthly or quarterly basis. This payment is usually calculated as a percentage of the franchise operation’s gross sales.

As a first step to start the franchise business a contract will have to be signed by the parties.  After the contract has been signed, the franchisee will open a replica of the franchise business, under the direction of the franchiser. The franchisee will not have as much control over the business as he or she would over his or her own, but may benefit from investing in an already-established brand. Generally, the franchiser will require that the business model stay the same. For example, the franchiser will require the franchisee to use the uniforms, business methods, and signs or logos particular to the business itself. The franchisee should remember that he or she is not just buying the right to sell the franchiser’s product, but is buying the right to use the successful and tested business process. The franchisee will also usually have to use the same or similar pricing, in order to keep the advertising streamlined. Apart from using the business model determined by the franchiser, the franchisee will otherwise remain an independent owner of the franchise.

However, there are no laws enacted solely for the purpose of regulating the growing business of franchising in India, even though many nations across the world have enacted such laws. The result is that when franchisors enter India they are governed by a number of different statutes and codes like the Indian Contract Act, the Competition Act, 2002, the Trademarks Act, 1999  the Consumer Protection Act, 1986, the Foreign Exchange Management Act, 1999  etc.,  rather than a single comprehensive enactment.  Therefore the parties proposing to enter into a franchise business should contact an experienced franchise attorney for assistance in order to comply with the legal requirements in India.  

Thursday, January 10, 2013



       Whether the property of a minor can be alienated by his guardian?  This is the issue dealt with in this Article.  Who is a Minor?  Section 4 (a) of the Hindu Minority and Guardianship Act, 1956 defines a Minor as “a person who has not completed the age of eighteen years”. Under Section-6 of the said Act, the natural guardians of a Hindu minor, in respect of the minor's person as well as in respect of the minor's property (excluding his or her undivided interest in joint family property) are - 

 “(a) in the case of a boy or an unmarried girl—the father, and after him, the mother: provided that the custody of a minor who has not completed the age of five years shall ordinarily be with the mother;

 (b) in the case of an illegitimate boy or an illegitimate unmarried girl - the mother, and after her, the father;

 (c) in the case of a married girl - the husband;

 Provided that no person shall be entitled to act as the natural guardian of a minor under the provisions of this section—

 (a) if he has ceased to be a Hindu, or

 (b) if he has completely and finally renounced the world by becoming a hermit (vanaprastha) or an ascetic (yati or sanyasi)

Explanation.—In this section, the expressions 'father' and 'mother' do not include a step-father and a step-mother”.

Under Section-7 of the said Act, the natural guardianship of an adopted son who is a minor passes, on adoption, to the adoptive father and after him to the adoptive mother. Under Section-8 (2) of the Act,  the natural guardian shall not, without the previous permission of the court,—

 (a) mortgage or charge, or transfer by sale, gift, exchange or otherwise any part of the immovable property of the minor or 

 (b) lease any part of such property for a term exceeding five years or for a term extending more than one year beyond the date on which the minor will attain majority.

No court shall grant permission to the natural guardian to do any of the acts mentioned above except in case of necessity or for an evident advantage to the minor. Now, the question is whether any alienation made by a natural guardian without previous permission of the court is illegal for ever. Under Section 8 (3) any disposal of immovable property by a natural guardian, in contravention of the above provisions is voidable at the instance of the minor or any person claiming under him.  Therefore the alienation is not void but it is voidable at the instance of the minor or any person claiming under him.  If the minor, on attaining majority (18 years) chooses not to challenge the alienation, the alienation will be perfectly valid.  But, on the other hand, if he challenges the alienation, the validity of the alienation will be decided by the court. However, such a challenge should be made within 3 years after the attainment of majority. Any suit to set aside an alienation of minor’s property by the guardian filed more than three years after the attainment of majority is barred under Section-60 of the Limitation Act.  Therefore the alienation cannot be challenged by a minor after three years from the attainment of majority.

         In some cases, it may so happen that the elder son did not challenge the alienation within three years after attainment of majority but the younger son challenges within three years. In other words, the suit filed by the younger son is within three years. The question is whether the suit filed by the younger son (within three years of attainment of majority) is maintainable. Section-7 of the Limitation Act states as follows:-

     “Where one of several persons jointly entitled to institute a suit or make an application for the execution of a decree is under any such disability, and a discharge can be given without the concurrence of such person, time will run against them all; but, where no such discharge can be given, time will not run as against any of them until one of them becomes capable of giving such discharge without the concurrence of the others or until the disability has ceased.

Explanation I - This section applies to a discharge from every kind of liability, including a liability in respect of any immovable property.

 Explanation II - For the purposes of this section, the manager of a Hindu undivided family governed by the Mitakshara law shall be deemed to be capable of giving a discharge without the concurrence of the other members of the family only if he is in management of the joint-family property”
       The Full Bench of the Madras High Court has held that the claim being a joint claim and the suit having been brought more than three years after the attainment of majority by the elder brother (who was the manager of the joint family, competent to give discharge) the claim was barred by limitation even in respect of the share of the younger brother who had not yet completed 21 years. Therefore if the eldest male member and Manager of the Hindu Undivided Family does not file a suit within three years after his attainment of majority, he cannot do it after three years and the said disability would extend to the other younger members of the joint family also and they are barred from bringing any suit.  This is because as the eldest member and manager, he is deemed to be  capable of giving a discharge without the concurrence of the other members of the family.