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Dominant test- commercial purpose

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  Mere fact that Opposite Party is a real estate company does not mean that flat was purchased for commercial purpose [1] Shubham Budhiraja [2] (i)                  To determine whether the goods purchased by a person (which would include a legal entity like a company) were for commercial purpose or not within the meaning of the Act would depend upon the facts and circumstances of each case.   (ii)                 However, ordinarily “commercial purpose” is understood to include manufacturing/industrial activity or business-to-business transactions between commercial entities. The purchase of the goods should have a close and direct nexus with a profit generating activity.   (iii)               If it is found that the dominant purpose behind purchasing the goods was for the personal use and consumption of the purchaser and/or the beneficiary, or was otherwise not linked with other commercial activities, the question whether such a purchase was for the purpose of “generati
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Clarification by Rajasthan HC on application of BNSS on pending FIR/ Investigations[1]

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  Shubham Budhiraja [2]   1.      What has to be been seen simply is the date of registration of the FIR and the law as applicable as on the date of such registration. Trite it may sound, but settled position is that, the moment an FIR is registered under section 154 of the Cr.P.C., criminal investigative/administrative machinery is set in motion under Chapter XII thereof. Thus, if an FIR is registered prior to 01.07.2023 under the Cr.P.C., it would amount to a pending enquiry/investigation within the meaning of section 531(2)(a) of BNSS. The entire subsequent investigation procedure and even the trial procedure qua such an FIR shall then be governed by Cr.P.C. and not BNSS.   2.      It so transpires that learned counsel for the petitioner had though rightly filed the instant petition initially under Section 482 Cr.P.C., but on an objection raised by Registry of this Court, it was converted into one under section 528 of BNSS.   3.      In view of the discussion in the pr
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Whether unstamped agreement to sell executed in the year 1988 can be relied upon in suit for possession?

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  Whether unstamped agreement to sell executed in the year 1988 can be relied upon in suit for possession?   Under what circumstances, photocopy of agreement to sell can be relied upon as secondary evidence?   Shubham Budhiraja [1]   A filed a suit for possession against B on basis of agreement to sell executed in the year 1989. During the hearing, A filed IA for reading photocopy of agreement to sell as secondary evidence because he is not able to find the original agreement to sell. The Trial Court allowed the IA but in review rejected that because agreement to sell was insufficiently stamped therefore bar of section 35 of stamp act applies. The High Court confirmed the order. The Hon’ble Supreme Court held that bar of Section 35 will not apply because amendment of 1990 wherein explanation was added to the stamp act was substantive in nature and therefore new obligation of stamping cannot be imposed on agreement of sell executed between A and B. [2]   (i)             
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Burden to prove transaction as commercial is on the Defendant

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  Shubham Budhiraja [1]   Mr. A subscribed to the chit tickets of chit fund company. The chit company stopped the business and Mr. A instituted consumer case seeking refund of deposits made in chit fund. The chit company took a plea that Mr. A is not a consumer because transaction is for commercial purpose. The Learned District Forum, Hon’ble State Commission and Hon’ble NCDRC favoured the complainant. The Hon’ble Supreme Court held as under [2] :   (i)              To file a complaint, one must be a complainant and for one to be a complainant, he must be a consumer. If a person fails to come within the definition of a consumer, he cannot be a complainant and therefore, such person cannot file a complaint under the Act.   (ii)            The definition of consumer has three parts. The significance of deconstructing the definition into three parts was for the purpose of explaining on whom lies the onus to prove each of the different parts. There can hardly be any dispute t
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What is the evidentiary value of facts deposed by power of attorney holder?

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  Shubham Budhiraja [1]   Mr. A filed suit for deceleration of easement rights against Mr. B. The Hon'ble Supreme Court held that it was nowhere pleaded in plaint that right was exercised for more than 20 years. Mere saying right was exercised for many years is not equal to 20 years. The evidence cannot go beyond pleadings. The deposition of POA can only of facts within his personal knowledge and not of someone else. Hence, suit fails. [2]     1.    The Power of Attorney holder who has no knowledge regarding the transaction cannot be examined as a witness.   2.    The functions of the General Power of Attorney holder cannot be delegated to any other person without there being a specific clause permitting such delegation in the Power of Attorney; meaning thereby ordinarily there cannot be any sub-delegation.                                                                             [1] Advocate, Delhi High Court [LLB, ACS, BCOM(H)], Budhirajalawchambers
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Plea of running account cannot be raised if there are no documentary evidence in support thereof

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  Shubham Budhiraja [LLB, ACS, BCOM(H)],   Budhirajalawchambers@gmail.com , +91-9654055315 The Hon’ble NCLAT, New Delhi in the case of M/s Murphy Steel v. M/s Gujarat Wedge Wire Screens Limited , Company Appeal (AT) Insolvency No. 171/2024 upheld the NCLT’s order wherein claim of operational creditor was dismissed for barred by limitation. This is a case where operational creditor set up a plea of running account to justify 26 invoices. All these invoices were of period between 2011 to 2016 whereas section 9 petition was filed in September 2020. The Learned NCLT dismissed the petition being time barred. The Hon’ble NCLAT upheld the findings of Learned NCLT and held that there is no document/agreement between the two parties which evidences running account payment underlying their business operations. In the absence of any documentary evidence which provides foundational basis to the claim that there was a running account, the decision in Shri Abhinandan Jain v. Tanaya Enterprises
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How to determine court's pecuniary jurisdiction under section 34 of the arbitration act, 1996?

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  Shubham Budhiraja Hon'ble Delhi High Court held that it is not the award amount but the claim amount + counter claim amount that determines pecuniary jurisdiction under section 34. [OMP (Comm) 465/2022]   (i)                  Under Section 5(2) of the Delhi High Court Act, 1966, the ordinary original civil jurisdiction of this Court is attracted in a suit valued at over Rs. 2 crores .   (ii)                 Section 12(2) of the Commercial Courts Act, 2015, relevant for valuation of these petitions under Section 34 of the Act, provides that the “specified value ” in an arbitration of a commercial dispute will include the value of both the claims and counter claims.   (iii)               Under Section 2(1)(e) of the Act, the jurisdiction for filing of proceedings in a Court-including a petition under Section 34 of the Act-would lie with the Court which would have had jurisdiction to entertain the claims if they were the subject matter of a suit .   (iv)             
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