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since 1985 practicing as advocate in both civil & criminal laws. This blog is only for information but not for legal opinions

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Saturday, April 25, 2015

Land Acquisition Act - Just Compensation - copies of orders/awards passed in relation to the adjacent lands for proving the market rate of the land in question because as mentioned above, these lands were situated in the same area nearer to the lands in question and were also acquired for the same public purpose - is the best of piece of evidence - 2015 S.C. MSKLAWREPORTS



We are, however, of the view that  the  Reference  Court  having  held
that the appellants were  entitled  to  compensation  at  the  rate  varying
between Rs.80/- to Rs.100/- per square feet, should have fixed  one  uniform
rate for the entire land rather than to fix different rates such as  Rs.80/-
, Rs.86/-, Rs.90/- and Rs.100/- per square feet  for  different  landowners.

In our view, since the land of all the appellants was more or  less  similar
in nature and no evidence  was  adduced  by  the  appellants  to  prove  any
significant  improvement/addition  or/dissimilarity  in  the  land  or   its
quality, the Reference Court should have fixed one uniform rate.

The appellants (landowners) were, therefore, justified in  filing  the
copies of orders/awards  passed  in  relation  to  the  adjacent  lands  for
proving the market rate of the land in question because as mentioned  above,
these lands were situated in the same area nearer to the lands  in  question
and were also acquired for the same public purpose.

It  was
all the more because  no  sale  deeds  were  available  for  filing  due  to
peculiar reason that there was a statutory ban imposed  by  Section  123  of
the A.P. Act for sale of private land in the area in question.  It  was  for
this reason, no private sale had taken place of any parcel of  land  at  the
relevant time barring one or two

we are  of  the  considered  opinion  that  the appellants are entitled to get the compensation for their  respective  lands
at the rate of “Rs.90 per square feet”. So far as the  compensation  awarded
by the Reference Court for super-structure built on  each  appellant’s  land
is concerned, it does not call for any interference.  In our  view,  it  was
rightly upheld by the High Court and we also uphold  the  same,  calling  no
interference.

  we wish to observe is  that  in  case  if  any  of  the
appellants apply for allotment of any land/shop/space to TTD  for doing  any
business in the area under their  ownership  or/and  control  then  the  TTD
would be at liberty and may consider their case for providing  them  a  shop
or land or space, as the case may be,  pursuant to any of their  scheme,  if
any in force, on suitable terms  and  conditions  alike  others  as  a  fine
gesture on the part of the TTD, for compliance.

 We, however, make it clear that the observations made in para  33  are
only in the nature of observations and not an order/writ issued against  the
TTD. - 2015 S.C. MSKLAWREPORTS.

Friday, April 24, 2015

whether the seller is entitled to forfeit the earnest money deposit where the sale of an immovable property falls through by reason of the fault or failure of the purchaser ? .-2015 S.C. [2012] MSKLAWREPORTS



 Law is, therefore, clear that to justify the forfeiture of advance money being part of ‘earnest money’ the terms of the contract should be clear and explicit. Earnest money is paid or given at the time when the contract is entered into and, as a pledge for its due performance by the depositor to be forfeited in case of non-performance, by the depositor. There can be converse situation also that if the seller fails to perform the contract the purchaser can also get the double the amount, if it is so stipulated. It is also the law that part payment of purchase price cannot be forfeited unless it is a guarantee for the due performance of the contract. In other words, if the payment is made only towards part payment of consideration and not intended as earnest money then the forfeiture clause will not apply.

When we examine the clauses in the instant case, it is amply clear that the clause extracted hereinabove was included in the contract at the moment at which the contract was entered into. It represents the guarantee that the contract would be fulfilled. In other words, ‘earnest’ is given to bind the contract, which is a part of the purchase price when the transaction is carried out and it will be forfeited when the transaction falls through by reason of the default or failure of the purchaser. There is no other clause militates against the clauses extracted in the agreement dated 29.11.2011.

We are, therefore, of the view that the seller was justified in forfeiting the amount of Rs.7,00,000/- as per the relevant clause, since the earnest money was primarily a security for the due performance of the agreement and, consequently, the seller is entitled to forfeit the entire deposit. The High Court has, therefore, committed an error in reversing the judgment of the trial court.

Consequently, the appeal is allowed and the impugned judgment of the High Court is set aside. However, there will be no order as to costs.-2015 S.C. [2012] MSKLAWREPORTS

Once it is held that the Raj Singh and others were the aggressors and that the incident had taken place in the house of the complainant and not at the house of the said appellants as alleged by them, there is no room for the appellants to claim the benefit of Exception 2 to Section 300 of the Code. That is so particularly when neither deceased-Girdhari Lal nor others examined as prosecution witnesses supporting the complainant’s case were armed. The question whether the appellants exceeded the right of private defence does not, therefore, really arise for consideration. Since no such right was, in the facts and circumstances of the case, available to them, there was no question of their exceeding the same.

                                                                  REPORTABLE

                        IN THE SUPREME COURT OF INDIA
                       CRIMINAL APPELLATE JURISDICTION

                    CRIMINAL APPEAL NOS . 701-702   /2015
              (Arising out of S.L.P. (Crl.) Nos.5767-5768/2013)

RAJ SINGH                                           ..Appellant
                                   Versus
STATE OF HARYANA  ETC.                         ..Respondents
                                    WITH
                     CRIMINAL APPEAL NO.   703   OF 2015
                 (Arising out of S.L.P. (Crl.) No.6347/2013)
RAJ KUMAR                                           ..Appellant
                                   Versus
MAHABIR & ORS.                                 ..Respondents
                                     AND
                     CRIMINAL APPEAL NO.  704   OF 2015
                (Arising out of S.L.P. (Crl.) No.10739/2013)
BHARAT SINGH                                        ..Appellant
                                   Versus
RISHI PAL & ORS.                                       ..Respondents


                               J U D G M E N T

R. BANUMATHI , J.

Leave granted.
2.          These appeals by way of Special Leave arise out  of  the  common
judgment dated 30.01.2013, passed by the Punjab and Haryana  High  Court  in
Criminal Appeal         No.D-440-DB of 2008 & Criminal Revision  No.2758  of
2008, by which,  the  High  Court  dismissed  the  Criminal  Appeal  of  the
appellant-Raj Singh and partly allowed the Criminal Revision qua  Raj  Singh
filed  by  Bharat  Singh  and  thereby  converting  the  conviction  of  the
appellant under Section 304 Part 1 IPC to Section  302  IPC  and  maintained
sentence of life imprisonment imposed on him and dismissed the revision  qua
Rishi Pal and Rajpal.
3.          Brief facts which led to the filing  of  these  appeals  are  as
follows:   The  complainant-Bharat  Singh  serves  in  the   Army   and   on
23.11.2004, he came to his village  for  fifteen  days  holidays.  They  are
three brothers, Girdhari Lal,  Devender  Singh  and  Bharat  Singh.  In  his
complaint, Bharat Singh alleged that on 3.12.2004 at about 6.00 pm, when  he
was standing at the main gate of his cousin’s  house  with  one  Tilak  Raj,
Rishipal-brother of the appellant came there with an axe  in  his  hand  and
there was  wordy  altercation.  Rishipal  assaulted  the  complainant-Bharat
Singh with a Kulhari on his left buttock, however, Bharat Singh  managed  to
save his life, and rushed towards his home.  The  complainant  narrated  the
whole incident to his brother  Devender  Singh  and  he  was  taken  to  the
hospital wherein Dr. Gobind Singh at  village  Badshahpur  treated  him  and
thereafter both the  brothers  returned  to  the  village.  When  the  elder
brother Girdhari returned home at about 8.30  P.M.,  Bharat  Singh  narrated
the whole incident to him and he was rebuked by his elder brother.
4.          While the complainant and others were talking to each  other  at
the main gate,  the appellant-Raj Singh, armed with licensed pistol,  Rishi,
armed with countrymade pistol,  Rajendra and Ram  Pal,  armed  with  lathies
came to the house of Girdhari Lal and  attacked  Bharat  Singh  and  others.
Appellant-Raj Singh fired shot at  Girdhari’s  chest  from  his  pistol  and
Girdhari  fell  down  on  the  ground.   When  Bharat  Singh  raised  alarm,
appellant fired at Bharat Singh which hit  his  left  back  side  below  the
shoulders.  As Bharat Singh  raised  alarm,  Mahabir  Singh  and  his  elder
brother Gajraj-PW6 rushed to the spot.  Mahabir tried to  lift  Girdhari  in
order to save him, at that time, Rishi  again  fired  from  the  countrymade
pistol on Mahabir Singh and Gajraj. Further Rajender  and  Rampal  assaulted
Gajraj with lathis. Girdhari was immediately taken to  Government  Hospital,
Gurgaon for treatment where the  doctor  declared  him  as  “brought  dead”.
Injured  persons  Mahabir,  Gajraj-PW6  and  Bharat  Singh-PW1  were   given
treatment.  On receipt of ruqqa from the Government Hospital, Gurgaon, PW13-
Rajender  Singh  (ASI)  recorded  the  statement  of  PW1–Bharat  Singh  and
registered the case in FIR No.321/2004 under Section 302 IPC. On  completion
of investigation, chargesheet was filed under Sections 323,  324,  302,  307
and 506 read with Section 34 IPC.
5.          To bring home the guilt of the accused, prosecution examined  as
many  as  thirteen  witnesses  and  accused  have  examined  three   defence
witnesses. The Additional Sessions Judge, Fast  Track  Court,  Gurgaon  vide
judgment dated 17.05.2008 held that the  appellant-Raj  Singh  had  exceeded
the right of private defence and convicted  the  appellant-Raj  Singh  under
Section 304 Part-1 IPC and acquitted Rajpal and  Rishi  Pal.  The  ASJ  Vide
separate order  dated  20.05.2008,  sentenced  the  appellant-Raj  Singh  to
undergo rigorous imprisonment for life and  imposed  a  fine  of  Rs.7,000/-
with default clause.
6.          Challenging the acquittal of Rishi Pal and Rajpal, Bharat Singh-
PW1 preferred Criminal Revision.  Challenging  his  conviction,  Raj  Singh-
accused preferred Criminal Appeal before the High  Court  wherein  the  High
Court vide common judgment dated 30.01.2013 dismissed  the  Criminal  Appeal
of the appellant-Raj Singh and allowed the Criminal Revision  filed  by  the
complainant-Bharat  Singh  and  thereby  converted  the  conviction  of  the
appellant under Section 304 Part 1 IPC to Section  302  IPC  and  maintained
the sentence of life imprisonment imposed on him.
7.          On the same day a cross case  i.e.  on  4.12.2004  in  the  same
police station was lodged by the appellant party against Mahabir  Singh  and
others and they were also charge  sheeted.   Vide  separate  judgment  dated
17.05.2008, trial court held that complainant party namely,  Mahabir  Singh,
Bharat Singh, Gajraj, Anil and Satish are guilty  of  constituting  unlawful
assembly and causing grievous injury with blunt  weapon  to  Rishi  Pal  and
Rajpal and convicted them under Sections 148, 323,  325  and  452  IPC  read
with Section 149 IPC and sentenced  them  to  undergo  various  imprisonment
imposed  on  them.   Being  aggrieved,  Bharat  Singh,  Mahabir  and  others
preferred appeal before High  Court.  Upon  consideration  of  evidence  and
material on record, High Court held that reasonable doubts arise as  to  the
prosecution version regarding scene of occurrence and the manner  of  attack
and held that death of Girdhari and injuries to the  accused  Mahabir  Singh
and others were not properly explained which is  fatal  to  the  prosecution
case and thus acquitted Mahabir Singh, Bharat Singh and others.
8.          Mr. Gurukrishna Kumar, learned Senior Counsel appearing for  the
appellants  contended  that  the  place  of  occurrence  was  house  of  the
appellant which means that the complainant party (seven in number)  came  to
the house as aggressors and the appellant had no option  but  to  fire  from
his gun in self defence of his own and his brothers and the alleged  act  of
the appellant cannot in any manner be said to  be  in  excess  of  right  of
private  defence.   It  was  further  submitted  that  the   appellant   had
specifically urged private defence which was accepted  by  the  trial  court
and erroneously rejected by the High Court.  Learned  Senior  Counsel  urged
that the High Court was  not  right  in  dissecting  the  statement  of  the
appellant under Section 313 Cr.P.C. by relying upon the inculpatory part  of
it but declining to take into account his explanation as to how the  firearm
shot occurred and the impugned judgment is unsustainable.
9.          Per contra, learned counsel for the respondents  contended  that
no  cogent  evidence  is  on  record  to  substantiate  the  argument   that
complainant party were the aggressors. It was submitted that the  occurrence
took place in the house  of  the  complainant  but  the  police  helped  the
appellant by changing the place  of  occurrence  after  three-four  days  of
occurrence.  It was argued that the act  of  the  appellant  in  firing  gun
shots was not in exercise of right of private defence  and  the  High  Court
rightly  reversed  the  judgment  of  the  trial  court  and  convicted  the
appellant under Section 302 IPC.
10.         We have carefully considered the rival submissions  and  perused
the evidence and material on record and the impugned judgment.
11.         PW1-Bharat Singh had spoken about the occurrence in the  evening
that he was attacked by the accused party with axe (kulhari) and  PW1-Bharat
Singh narrated the  same  to  his  brothers  Girdhari  (deceased)  and  Anil
Kumar–PW5 who returned home at about 8.30 P.M. after  attending  a  marriage
party.  Girdhari rebuked Bharat Singh and when they were all talking in  the
house of Girdhari, the appellant and his brother Rishi Pal and  Rajpal  came
to the house of Girdhari armed  with  deadly  weapons.  Appellant-Raj  Singh
fired gun shots and Girdhari sustained firearm injury in his  chest  and  he
fell down.  Raj Singh fired at Bharat Singh-PW1 and  injury  was  caused  on
the backside of his shoulder.  When Mahabir tried to lift Girdhari, at  that
time Rishi Pal  fired  at  Mahabir  with  countrymade  pistol.   Rajpal  and
Rajendra  are alleged to have given lathi blows  on  the  person  of  Gajraj
Singh–PW6 and all the accused ran away, Girdhari was taken to  hospital  and
he was declared ‘brought dead’ by the doctor.   PW1-Bharat  Singh,  PW5-Anil
Kumar and PW6-Gajraj have clearly spoken about  the  occurrence,  they  were
consistent in their version despite searching  cross-examination  and  their
evidence  is   trustworthy.    Further,   evidence   of   eye-witnesses   is
strengthened by the medical evidence.
12.         To substantiate the defence plea that the complainant party  are
the  aggressors,  much  reliance  is  placed  on  the  evidence  of  PW7-Dr.
Kulvinder Singh, Senior Scientific Officer who has stated  that  he  visited
the place of   occurrence–house of the accused as well as house of  deceased
Girdhari on 7.12.2004.  As per the site plan Ex.PG/I dead body was  detected
at spot ‘A’ and that blood stains were detected on polythene sheet  at  plan
‘C’ and splashes of blood detected on dung cakes and one woolen monkey  cap,
four empty cartridges  and  one  live  cartridge  were  recovered  from  the
courtyard of the house of the accused.   PW7  specifically  stated  that  no
blood stains or any other physical clues related to the occurrence could  be
detected in the courtyard of the house of deceased-Girdhari.
13.         Laying much emphasis upon the site plan  prepared  on  7.12.2004
and evidence of PW7, learned Senior  Counsel  for  the  appellant  submitted
that PW7 is a government official and an  independent  witness  who  has  no
reason to depose falsely in favour of the appellant and  his  statement  has
been further corroborated by the  evidence  of  the  investigating  officers
namely PW8-Kuldip Singh(SI) and PW13-Rajender Singh (ASI).   Learned  Senior
Counsel further submitted that the High Court erred  in  saying  that  there
was no explanation as to how the articles remained in the courtyard  of  the
house of the accused and were not recovered for  four-five  days,  the  High
Court has not properly  appreciated  the  evidence  of  PW13  and  erred  in
reversing the findings of the trial court.
14.         It is to be noted PW8-Kuldeep Singh,  Sub  Inspector  of  Police
had deposed that on 4.12.2004, he  along  with  DSP  Sube  Singh  and  other
police officials went to Girdhari’s house and recorded the statement of  one
Rajkumar and others and spot inspection was  also  conducted  as  per  their
version and according to him no site plan was prepared on 4.12.2004  as  the
ladies of the house were weeping and everyone was disturbed.  On  5.12.2004,
PW8-Kuldeep Singh (SI) prepared the site plan of the place of occurrence  as
given in the F.I.R.,   but  according  to  PW8,  no  physical  evidence  was
available at the spot on 5.12.2004.  On 7.12.2004, a team of  experts  along
with PW13-Rajender Singh (ASI) inspected the house of the accused-Raj  Singh
and Rajpal and recovered four empty cartridges, one live  cartridge,  monkey
cap and five pairs of hawai chappals and blood stains on polythene.   It  is
a matter of common knowledge that the above material  objects  recovered  on
7.12.2004 could have been noticed with naked eyes.  While so,  it  is  quite
unnatural as to why  the  above  material  objects  were  not  recovered  on
4.12.2004 and 5.12.2004 inspite of the  investigating  team  inspecting  the
spot on those two days.  It is in this backdrop,  the  evidence  of  PW7-Dr.
Kulvinder Singh and PW13-Rajender Singh (ASI) as to the alleged recovery  on
7.12.2004 has to be examined.
15.         PW13-ASI Rajender Singh has stated that he made  enquiries  from
some persons and he came to know that the actual place of occurrence is  the
house of appellant and as such no person has been examined in the  court  to
show that the place of occurrence was the house of  accused.   In  the  site
plan prepared on 5.12.2004, the place of occurrence was shown  as  in  front
of the house of Girdhari and not in  the  courtyard  of  the  house  of  the
appellant.  In their statement under Section 313 Cr.P.C., the  accused  have
stated that    PW1–Bharat Singh and his brothers PW5-Anil  Kumar,  deceased-
Girdhari, joined together and went to the house of the accused and that  the
place of occurrence is the house of the accused.   As  rightly  observed  by
the High Court,  the  accused  have  also  not  examined  any  witnesses  to
substantiate their plea.  Ignoring these material aspects, in our view,  the
Sessions Judge was not right in holding that the  place  of  occurrence  was
the  house  of  the  accused  and  that  the  complainant  party  were   the
aggressors.   The  approach  of  the  learned  Sessions  Judge  borders   on
perversity and reasons for holding that the  place  of  occurrence  was  the
house of the accused is factually unsustainable and the High  Court  rightly
set aside the findings of the trial court. We concur with  the  findings  of
the High Court that the investigating officer had helped  the  appellant  by
changing the place of occurrence to make  it  appear  that  the  complainant
party were the aggressors.
16.         Plea of self-defence: The contention of the  appellant  is  that
he is not an aggressor and since the complainant party was in possession  of
lethal weapons which caused reasonable  apprehension  in  the  mind  of  the
appellant as to the threat to his life and his two  brothers  and  therefore
the appellant had no option but to fire from his gun and the alleged act  of
the appellant cannot, in any manner, be said to be in excess  of  his  right
of private defence.
17.         The right of private defence is codified in Sections 96  to  106
IPC.   Section 96 declares that “nothing is an  offence  which  is  done  in
exercise of the right of the  private  defence”.   Section  97  states  that
every person has right  of  defence  of  person  as  well  as  of  property.
Section 100 describes the situations in which the right of  private  defence
of body extends to the extent of voluntarily causing  of  death.   To  claim
right of private  defence extending  to  voluntary  causing  of  death,  the
accused must show that there were circumstances giving  rise  to  reasonable
grounds for apprehending  that either   death  or  grievous  hurt  would  be
caused to him.  The law of private defence does not require that the  person
assaulted or facing apprehension of an assault must  run  away  for  safety.
It entitles him to defend  himself  and  law  gives  him  right  of  private
defence.   There  is  no  right  of  private  defence  where  there  is   no
apprehension of danger.  Necessity of averting and impending danger must  be
present, real or apparent.
18.         Elaborating the scope of right of  private  defence,  in  Dharam
And Ors. vs. State of Haryana, (2007) 15 SCC  241  in  paragraphs  (18)  and
(19) it was held as under:-
“18. Thus, the basic principle underlying  the  doctrine  of  the  right  of
private defence is that when an individual or his property is faced  with  a
danger and immediate aid from the State machinery is not readily  available,
that individual is entitled to protect himself and his property. That  being
so,  the  necessary  corollary  is  that  the  violence  which  the  citizen
defending himself or his property is entitled to  use  must  not  be  unduly
disproportionate to the injury which is sought to be  averted  or  which  is
reasonably apprehended and should not  exceed  its  legitimate  purpose.  We
may, however, hasten to add that  the  means  and  the  force  a  threatened
person adopts at the spur of the moment to ward off the danger and  to  save
himself or his property cannot be weighed in golden scales.  It  is  neither
possible nor prudent to lay down abstract parameters which  can  be  applied
to determine as to whether the means and force  adopted  by  the  threatened
person was proper or not. [pic]Answer to such  a  question  depends  upon  a
host of factors like the prevailing circumstances at the spot, his  feelings
at the relevant time, the confusion and  the  excitement  depending  on  the
nature of assault on him, etc. Nonetheless, the exercise  of  the  right  of
private defence can never be vindictive or malicious. It would be  repugnant
to the very concept of private defence.

19. It is trite that the burden of establishing the plea of self-defence  is
on the accused but it is not  as  onerous  as  the  one  that  lies  on  the
prosecution. While the prosecution is required  to  prove  its  case  beyond
reasonable doubt, the accused need not establish the  plea  of  self-defence
to the hilt  and  may  discharge  the  wonus  by  showing  preponderance  of
probabilities in favour of that plea on the basis of the material on  record
(see Munshi Ram v. Delhi Admn.(AIR 1968 SC 702), State  of  Gujarat  v.  Bai
Fatima((1975) 2 SCC 7)  and Salim Zia v. State of U.P.(1979) 2 SCC 648).”

19.         In the case of Bhanwar Singh & Ors. vs. State of  M.P.,   (2008)
16 SCC 657, in paragraphs (50) and (60) it was held as under:-
“50. The plea of private defence has been brought up by the appellants.  For
this plea to succeed in totality, it must be proved  that  there  existed  a
right to private defence in favour of  the  accused,  and  that  this  right
extended to causing death. Hence, if the court were  to  reject  this  plea,
there are two possible ways in which this may be done. On one hand,  it  may
be held that there existed a right to private defence of the body.  However,
more harm than necessary was caused or, alternatively, this  right  did  not
extend to causing death. Such a ruling may  result  in  the  application  of
Section 300 Exception 2, which states that culpable homicide is  not  murder
if the offender, in the exercise in good  faith  of  the  right  of  private
defence of person or property, exceeds the power given to  him  by  law  and
causes the death of the person against whom he is exercising such  right  of
defence without premeditation, and without any intention of doing more  harm
than is necessary for the purpose of such defence. The  other  situation  is
where, on appreciation of facts, the right of private defence  is  held  not
to exist at all.

60. To put it pithily, the right of private defence is a defence  right.  It
is neither a right of aggression or  of  reprisal.  There  is  no  right  of
private defence where there is no  apprehension  of  danger.  The  right  of
private defence is available only to one who  is  suddenly  confronted  with
the  necessity  of  averting  an  impending  danger  not  of  self-creation.
Necessity must be present, real or apparent”. (emphasis added)

The same view is also expressed in the cases of Biran  Singh  vs.  State  of
Bihar, AIR 1975 SC 87, Wassan Singh vs. State of Punjab,(1996)  1  SCC  458,
Sekar alias Raja Sekharan vs. State  represented  by  Inspector  of  Police,
T.N., (2002) 8 SCC 354, Buta Singh vs. State of Punjab,  AIR  1991  SC  1316
and James Martin vs. State of  Kerala, (2004) 2 SCC 203.
20.         In the present case, plea of private defence has been put  forth
by the appellant.  To succeed in the plea of private defence, the  appellant
has to prove that he exercised right of private defence in  his  favour  and
this right extended to the extent  of  causing  death.   In  the  facts  and
circumstances of the present case, let us consider whether right of  private
defence was available  to  the  accused.  Case  of  the  appellant  is  that
complainant party forcibly entered his house and started  fighting  and  the
appellant had reasonable apprehension that he would be  hurt  and  therefore
he fired the few shots  in the air, and during the scuffle, the  complainant
party tried to forcibly  snatch pistol from him  and  fire  was  shot  which
incidentally hit the deceased-Girdhari. Further case  of  the  appellant  is
that the complainant party armed with weapons were the aggressors  and  they
caused serious injuries to the appellant and  his  brothers  Rishi  Pal  and
Rajpal.
21.         DW2-Dr. Arun  has  expressed  his  opinion  about  the  injuries
caused to Rishi Pal and stated that Rishi Pal  sustained  some  bruises  and
contusions and had pain in the left foot.  DW2-Dr. Arun examined Rajpal  who
was brought to the hospital and there was pain  and  swelling  in  the  left
elbow, pain and swelling in  the  right  wrist.   DW1-Dr.  Shailza  Aggarwal
examined x-ray of Rishipal and found that there was fracture  in  the  fifth
metatarsal of the left foot. DW1-Dr. Shailza Aggarwal  also  examined  x-ray
of Raj Pal and found fracture of fifth metacarpal right hand.  The  injuries
on the person of the accused were not so serious.

22.         Bharat Singh and his brothers were  not  carrying  any  arms  or
deadly weapons.  The accused-appellants if  at  all  any  right  accrued  in
their favour, while defending themselves, acted in a manner which is  unduly
disproportionate to the injury which they would have sustained at the  hands
of complainant party who were not armed  with  any  deadly  weapons.   Thus,
their act of firing shots which resulted in death of Girdhari,  was  not  at
all to prevent any injury which was sought to  be  averted  or  which  could
have been reasonably apprehended.  At  no  point  of  time,  any  reasonable
apprehension of death or grievous injury was perceivable, but  the  accused-
appellants aggressively acted and fired shots  at  deceased.   Relying  upon
the evidence of PW-5-Anil Kumar, High Court also  recorded  a  finding  that
appellant fired Girdhari from a short distance of four to  five  feet,  even
when the complainant party was not armed  with  lethal  weapons.   Appellant
fired at  Girdhari  recklessly  from  a  close  range  indicating  that  the
appellant-accused party were the aggressors.  Law does not  confer  a  right
of self-defence on a man when he himself was the aggressor.  In the  present
case, the complainant party were not armed  with  lethal  weapons;  but  the
appellant was armed with a pistol.  When the appellant and  his  party  were
the aggressors firing several rounds of  firearm,  the  High  Court  rightly
held  that  the  plea  of  self  defence  raised  by  the  accused  is   not
sustainable.  We find no reason warranting interference with the  conviction
of the appellant under Section 302 IPC and  sentence  of  life  imprisonment
imposed on him.

23.         Criminal Appeal arising out of  SLP  (Crl.)  No.10739/2013:   So
far as acquittal of Rishi Pal and Rajpal is concerned,  concurrent  findings
were recorded by both the  trial  court  as  well  as  the  High  Court  for
acquitting them.  The appellate court would  interfere  with  the  order  of
acquittal  only  when  the  court  below  ignores  or  overlooks   important
circumstances and proved facts and misapplies  the  principles  of  criminal
jurisprudence or tries to gloss over them.  In the case in hand,  it  cannot
be said that the reasonings recorded by the courts below  for  acquittal  of
Rishipal  and  Raj Pal are unreasonable warranting interference in  exercise
of jurisdiction under Article 136 of the  Constitution of  India   and  this
appeal is liable to be dismissed.

24.            Criminal    Appeal    arising    out    of     SLP     (Crl.)
No.6347/2013:  As mentioned above, on the same day i.e. 4.12.2004,  a  cross
case in the same police  station  (Police  Station,  Sohna)  was  registered
against the  complainant  party,  namely,  Mahabir,  Satish,  Bharat  Singh,
Gajraj, Anil and  Devender.  According  to  the  complainant-Raj  Singh,  on
3.12.2004, due to his illness he was in his house and at that time he  heard
some abuse and when he reached the house  of  his  brother  Rajpal,  he  saw
Girdhari lying on the ground.  He  further  stated  that  Mahabir,  Gajaraj,
Anil, Devender, Bharat Singh and Satish son of Mahipal  were  present  there
and Gajraj was armed  with  lathi,  Mahabir  was  armed  with  country  made
pistol, Anil was armed with pharsa, Devender and Lallu were having rods  and
Bharat Singh was having  countrymade pistol  and Satish was  having  rod  in
his hand and these persons caused injuries to his brothers Rajpal and  Rishi
Pal. After  completion  of  investigation,  chargesheet  was  filed  against
Mahabir and others in Sessions Case No. 3/2006. Vide  separate  order  dated
17.5.2008, the Additional Sessions Judge, Fast Track  Court,   Gurgaon  held
that respondent party namely Mahabir,  Satish  alias  Lallu,  Bharat  Singh,
Gajraj, Anil  are guilty  of  constituting  unlawful  assembly  and  causing
grievous injuries with blunt weapon  and  convicted  them  under    Sections
148, 323, 325, 452 IPC read with  Section  149  IPC.  For  conviction  under
Section 325 IPC read with Section 149 IPC, trial  court  sentenced  each  of
them to undergo rigorous imprisonment for two years and  fine  of  Rs.1500/-
each with default clause.  For conviction under  other  offences  they  were
imposed  various  sentence  of  imprisonment  and  also  fine.  Sentence  of
imprisonment imposed on each of  them  were  ordered  to  run  concurrently.
Giving benefit of doubt, Devender was acquitted of the charges.  Challenging
the  verdict  of  conviction,  Mahabir  and  others  filed  Criminal  Appeal
   No.S-1062-SB/2008 before the High Court of Punjab  and  Haryana  and  the
High Court vide common order dated 30.01.2013  allowed  the  appeal  of  the
accused persons and the High Court acquitted them of all the charges.

25.         As discussed earlier, place of occurrence was not the  house  of
Raj Singh or his brother’s house as is evident from the fact,  objects  were
not recovered immediately but recovered only after a gap of three-four  days
and no credible explanation is forthcoming from PW8-Kuldeep Singh  (SI)  and
PW 13- Rajender Singh (ASI) for such delay.  By perusal of the  evidence  on
record, it is clear neither any firearm was used by Bharat Singh and  others
nor any such firearm was found in their  possession.   As  far  as  injuries
sustained by Rishi Pal and Rajpal are concerned, Rajpal sustained  lacerated
wound and fracture fifth of metacarpal and Rishi Pal sustained  fracture  of
fifth metatarsal.  The doctors  have  opined  that  the  said  injuries  are
possible by a fall.  As discussed earlier, Mahabir and others  were  neither
the aggressors nor there was any pre-meditation to cause the said  injuries.
 Upon consideration of  the  facts  and  circumstances  and  the  nature  of
injuries caused, the High Court rightly  held  that  the  complainant  party
(Mahabir and others) acted in private defence  and  acquitted  them  of  the
charges.  Considering the nature of injuries and other material  on  record,
in our view, the complainant party have not exceeded their right of  private
defence and  caused harm  that was necessary  for  the  purpose  of  private
defence. Upon appreciation of evidence, the  High  Court  rightly  acquitted
Mahabir and others and we find no reason to interfere with the same.

26.         Criminal appeals arising out of  S.L.P.(Crl.)  Nos.5767-5768/13.
 The conviction of  the  appellant-Raj  Singh  under  Section  302  IPC  and
sentence of life imprisonment imposed on him is confirmed  and  the  appeals
preferred by Raj Singh are  dismissed.   Criminal  appeals  arising  out  of
S.L.P.(Crl.) Nos.6347/13 & 10739/13 filed by  Raj  Kumar  and  Bharat  Singh
stand dismissed.

                                 ..………………….J.
            (T.S. Thakur)


                                 ...………………….J.
    (R. Banumathi)


                                     .……………………J.
    (Amitava Roy)
New Delhi;
April 23, 2015
                                                   REPORTABLE


                        IN THE SUPREME COURT OF INDIA
                       CRIMINAL APPELLATE JURISDICTION

                   CRIMINAL APPEAL NOs.   701-702  OF 2015
             (Arising out of S.L.P.(Crl.)Nos.5767-5768 of 2013)


Raj Singh                                          …Appellant

Versus

State of Haryana etc.                        …Respondents
                                    WITH


                    CRIMINAL APPEAL NO.    703   OF 2015
                (Arising out of S.L.P.(Crl.)No.6347 of 2013)


Raj Kumar                                    ...Appellant

Versus

Mahabir & Ors.                                     ...Respondents

                                    WITH

                    CRIMINAL APPEAL NO.    704   OF 2015
                (Arising out of S.L.P.(Crl.)No.10739 of 2013)


Bharat Singh                                       ...Appellant

Versus

Rishi Pal & Ors.                              ...Respondents

                               J U D G M E N T

T.S. THAKUR, J.

1.    I have had the advantage of going through the  order  proposed  by  my
Esteemed Sister Banumathi, J.  While I agree with the conclusion arrived  at
by her, I would like to add a few lines of my own.

2.    Exception 2 to Section 300 of the  Indian  Penal  Code  provides  that
culpable homicide is not murder if the offender, in  the  exercise  in  good
faith of the right of private defence of person  or  property,  exceeds  the
power given to him by law and causes the death of the  person  against  whom
he is exercising such right of defence without  premeditation,  and  without
any intention of doing more harm than is necessary for the purpose  of  such
defence.  Right of private defence is, in turn, recognised by Section 96  of
the Code which provides that nothing is an offence  which  is  done  in  the
exercise of the right of private defence. Section 97 of the Code  recognises
the private defence of the body and of property and reads as:

“97. Right of private defence of the body and of property.  –  Every  person
has a right, subject to the restrictions contained in Section 99, to  defend


First.-     His own body, and the body of  any  other  person,  against  any
offence affecting the human body.

Secondly.-  The property, whether movable or immovable,  of  himself  or  of
any other person, against any act which is  an  offence  falling  under  the
definition of theft, robbery, mischief or criminal trespass, or which is  an
attempt to commit theft, robbery, mischief or criminal trespass.”



3.    Section 99 of the Code deals with  acts  against  which  there  is  no
right of private defence  and,  inter  alia,  provides  that  the  right  of
private defence in no case extends to the inflicting of more  harm  than  it
is necessary to inflict for the purpose of defence. Section 100 of the  Code
deals with situations in which the right of  private  defence  of  the  body
extends to voluntarily causing death or of any other harm to the  assailant,
if the offence which occasions the exercise of the right is one of the  kind
enumerated under the said Section. The offences enumerated  under  the  said
provision include offences like causing  death,  grievous  hurt,  committing
rape,  gratifying  unnatural  lust  and  assault  with  the   intention   of
kidnapping or abducting.  Section 103 of the Code similarly deals  with  the
right of private defence of property in  situations  enumerated  thereunder,
which includes offences like robbery, house-breaking by night,  mischief  by
fire committed of any building, tent or vessel  used  as  a  human  dwelling
etc.



4.    A conjoint reading of provisions of Sections 96 to 103  and  Exception
2 to Section 300 of the  Code  leaves  no  manner  of  doubt  that  culpable
homicide is not murder if the offender, in the exercise  in  good  faith  of
the right of private defence of person or property, exceeds the power  given
to him by law and causes  the  death  of  the  person  against  whom  he  is
exercising such right of defence, provided  that  such  right  is  exercised
without premeditation and without any intention of doing more harm  than  is
necessary for the purpose of such defence.  A fortiori  in  cases  where  an
accused sets up right  of  private  defence,  the  first  and  the  foremost
question that would fall for determination by the  Court  would  be  whether
the accused had the right of private  defence  in  the  situation  in  which
death or other harm was caused by him.  If the answer to  that  question  is
in the negative, Exception 2 to Section 300 of  the  Code  would  be  of  no
assistance.  Exception 2 presupposes that the  offender  had  the  right  of
private defence of person or property but he  had  exceeded  such  right  by
causing death. It is only in case answer to the first  question  is  in  the
affirmative viz. that the offender had the right of  defence  of  person  or
property, that the next question viz. whether he had  exercised  that  right
in good faith and without premeditation and without any intention  of  doing
more harm that was necessary for the purpose of such  defence  would  arise.
Should answer to any  one  of  these  questions  be  in  the  negative,  the
offender will not be entitled to the benefit of Exception 2 to  Section  300
of the Code. Absence of good faith in the exercise of the right  of  private
defence, premeditation for the exercise of such right  and  acts  done  with
the intention of causing more harm than is  necessary  for  the  purpose  of
such defence would deny to the  offender  the  benefit  of  Exception  2  to
Section 300. The legal position on the subject is fairly well settled  by  a
long line of decisions of this Court to which  copious  reference  has  been
made by Banumathi, J.  No useful purpose  would,  therefore,  be  served  by
referring to them over again.  All that need be said is that whether or  not
a right of private defence of  person  or  property  was  available  to  the
offender is the very first question that must be addressed in a case of  the
present kind while determining the nature of the offence  committed  by  the
accused, whether or not a right of  private  defence  was  available  to  an
offender is, in turn, a question of fact or atleast a mixed question of  law
and fact to be determined in the facts and circumstances of each  individual
case that may come up before the court.

5.    The High Court has, in the case at hand, clearly  recorded  a  finding
that the appellants were the aggressors in the  incident  that  led  to  the
death of deceased-Girdhari Lal.  Banumathi, J. has  in  the  proposed  order
referred to the evidence supporting that finding. Once it is held  that  the
Raj Singh and others were the aggressors and that  the  incident  had  taken
place in the house of the complainant and not  at  the  house  of  the  said
appellants as alleged by them, there is no room for the appellants to  claim
the benefit of Exception  2  to  Section  300  of  the  Code.   That  is  so
particularly when neither  deceased-Girdhari  Lal  nor  others  examined  as
prosecution witnesses supporting the  complainant’s  case  were  armed.  The
question whether the appellants exceeded the right of private  defence  does
not, therefore, really arise for consideration. Since no such right was,  in
the facts and circumstances of the case, available to  them,  there  was  no
question of their exceeding the same.



6.    With the above words, I concur with the order proposed by my  esteemed
sister.



                                                         ……..………….……….…..…J.
                                                               (T.S. Thakur)

New Delhi
April 23, 2015



What was imported by the appellant was not merely paper but drawings and designs on paper whose value had to be added for the reason that the appellants/importers were themselves going to exploit the intellectual content of the goods that were imported themselves. In the facts before us the appellants, as has been pointed out above, do not exploit the intellectual content in the CDs produced by them by way of sale as the sale by them can only be to the copyright owner himself. It is clear therefore that this case would have no bearing on the present case. 14. Given the fact that no part of the royalty can be loaded on to the duplicate CDs produced by the appellant, the circular dated 19.2.2002 which deals with apportionment of royalty would have no application to the facts of the present case. In the circumstances, the impugned judgment dated 11.6.2004 is set aside. Refund, if any, to be made of additional duty collected pursuant to the impugned judgment may be claimed by the appellant in accordance with law. The appeal is allowed in the aforesaid terms.

                                                                  REPORTABLE

                        IN THE SUPREME COURT OF INDIA

                        CIVIL APPELLATE JURISDICTION

                        CIVIL APPEAL NO.6709 OF 2004




      M/S. K.R.C.D. (I) PVT. LTD.                 …APPELLANT


                                   VERSUS


      COMMISSIONER OF CENTRAL
      EXCISE, MUMBAI                       ...RESPONDENT




                               J U D G M E N T

      R.F. Nariman, J.

      1.    The facts of the present case reveal that the appellant  started
      manufacturing duplicate CDs from a master tape/CD issued to them by  a
      distributor who  had  copyright  in  the  contents  of  the  CD.   The
      following chain will show exactly how the present transaction  of  job
      work is done.  The artist/lyricist who is the owner of copyright parts
      with the copyright for a certain consideration to a producer of  music
      which music/picture is then captured on video CD and CD.  The producer
      in turn parts with such copyright in  favour  of  a  distributor  who,
      ultimately, gets the said CDs duplicated as has been stated  aforesaid
      by the appellant on job work basis, and who then sells the CDs in  the
      market to the ultimate customer.  The facts also demonstrate that  the
      appellant/assessee  is  only  given  the  master  CD  from  which   it
      duplicates such master tape/CD on blank CDs that are owned by  it  and
      then sold to the distributor copyright holder, having paid a lump  sum
      royalty to the producer of the music which is on the CD.  The  process
      adopted by the appellant for  duplicating  the  CDs  from  the  master
      tape/CD or DAT  has  been  detailed  in  the  impugned  order  of  the
      Commissioner (Appeals).  From the DAT supplied by the  customers,  the
      appellants arrange to manufacture a stamper i.e. Nickel plate on which
      the data is coded.  The stamper is used as a mould  to  manufacture  a
      CD, which while manufacturing the CD, transfers data from the  stamper
      to a CD.  The programme which is duplicated on the CD is owned by  the
      customer who is either himself  the  distributor  or  is  a  copyright
      owner.  The distributor/copyright holder then,  upon  receipt  of  the
      duplicate copies from the appellant loads part of the royalty paid  to
      the music producer on each such CD which as has been stated  above  is
      then sold to the ultimate customer in the market.  The entire stock of
      duplicate CDs can only be sold to the distributor/copyright holder and
      to nobody else.

      2.    On 31.8.1998, provisional assessments for  the  period  1995  to
      1998 were finalised by the Assistant Commissioner  of  Central  Excise
      demanding  duty  inter  alia  on  royalty  charges  incurred  by   the
      distributor/copyright holder.  The Commissioner (Appeals) by an  order
      dated 20.7.1999 set aside the order dated 31.8.1998 and held that  the
      appellants were already including a royalty of one rupee per CD in the
      assessable value of the  CD  and  remanded  the  matter  back  to  the
      Assistant  Commissioner.   On  remand,  the   Assistant   Commissioner
      directed the appellant to file a price  declaration  along  with  cost
      break up certified by  a chartered account.  Such declaration reads as
      follows:-

           Declaration under Rule 173C dated 14.3.2000 for break up of  the
           cost of CDs.

|Raw material and other       |6.31               |
|expenses                     |                   |
|Inlay Card                   |2.00               |
|Jewel Box                    |4.30               |
|Royalty (cost of copyright)  |1.00               |
|Royalty (Patent charge)      | 0.43              |
|Total                        |14.43              |


             Based  on  the  aforesaid  declaration,  the   appellant   paid
      differential duty of Rs.14,31,678/- at the rate of one  rupee  per  CD
      for CDs cleared during the period 1995 to 2000, and also paid a sum of
      Rs.10,210/- for CDs cleared for the period 1st March  to  14th  March,
      2000.  On 4.12.2001, the Assistant Commissioner issued  a  show  cause
      notice proposing to demand differential duty  of  Rs.5,91,45,700/-  on
      CDs cleared during the period November, 2000 to  October,  2001.  This
      differential   duty   consisted   of   royalty    payable    to    the
      distributor/copyright holder which royalty  was  calculated  at  54.81
      rupees per CD.  The basis of the royalty calculation was given in  the
      said show cause notice.

      3.    On 25.2.2002, the Deputy Commissioner confirmed the  show  cause
      notice and also issued a  penalty  of  an  equivalent  amount  plus  a
      penalty of  Rs.1  crore  on  Shri  Rajiv  Aggarwal,  Director  of  the
      Appellant Company.  By  an  order  dated  2.8.2002,  the  Commissioner
      (Appeals)  held   that   the   royalty   charges   incurred   by   the
      distributor/copyright  holder  is  liable  to  be  included   in   the
      assessable value of the CDs. He remanded the matter to  the  Assistant
      Commissioner to quantify the demand after  taking  into  consideration
      the amount of royalty to be apportioned,  which  had  been  prescribed
      under a circular dated 19.2.2002.  Vide  an  order  dated  11th  June,
      2004, CESTAT confirmed the order of the Commissioner (Appeals).

      4.    Shri Lakshmikumaran, learned counsel on behalf of the  appellant
      has argued that the job work done by the appellant did not include any
      element of royalty.  In  fact,  the  amount  of  rupee  one  that  was
      declared in the price list filed by the appellant  was  only  for  the
      music that is embedded in the CD but not for any royalty thereon. This
      is clear from the fact that the appellant had to perform  certain  job
      work on blank CDs owned by it, which is merely to copy the master tape
      given by the distributor/copyright holder, and, as  is  apparent  from
      the price list filed, the distributor/copyright holder is charged  for
      the raw material and other expenses, being the blank duplicate CD, the
      inlay card, the royalty attributable to the music content  of  the  CD
      and the jewel box.  It is the  distributor  and  others  who  are  the
      copyright holders who then sell these  duplicate  CDs  in  the  market
      loading on to them the royalty cost paid by the distributor and others
      in lump sum to the music producer.  Since no part of the  royalty  had
      in fact passed,  no  amount  of  royalty  could  be  included  in  the
      assessable value.

      5.    Shri Rupesh Kumar, learned counsel  on  behalf  of  the  Revenue
      argued that when the master tape was handed over  by  the  distributor
      who was also the copyright holder, obviously what was handed over  was
      a CD with music on it, which music was inextricably bound with royalty
      that was paid for it.  It is clear that the master tape could  not  be
      given to the appellant for duplication unless royalty  had  been  paid
      which royalty would form part of the cost of the goods to be  produced
      by the appellant and then sold to  the  distributor/copyright  holder.
      In this view of the matter, it  would  be  correct  to  say  that  the
      royalty that is payable would  also  have  to  be  loaded  on  to  the
      duplicate CDs produced by the appellant and apportioned  in  a  manner
      stated in the circular dated  19.2.2002.   This  being  so,  there  is
      nothing wrong with the order of the Tribunal that is impugned  in  the
      present case.

      6.    In the present case, Section 4(1)(a) of the Central  Excise  Act
      will not apply for the simple  reason  that  price  is  not  the  sole
      consideration for the sale as a master tape had to be handed  over  by
      the distributor/copyright holder  to  the  appellant.   Since  Section
      4(1)(b) applies, the Central Excise Valuation (Determination of  Price
      of Excisable Goods) Rules, 2000, would apply.  Both parties agree that
      Rule 6 would be applicable to the facts of the present case.

      7.    Rule 6 of the said Rules reads as follows:

           “Rule 6. Where the excisable goods are sold in the circumstances
           specified in clause (a) of sub section (1) of section 4  of  the
           Act except the circumstance where the  price  is  not  the  sole
           consideration for sale, the value of such goods shall be  deemed
           to be the aggregate of such transaction value and the amount  of
           money value of any additional consideration flowing directly  or
           indirectly from the buyer to the assessee.

           Explanation.-For removal of doubts, it is hereby clarified  that
           the value, apportioned as appropriate, of  the  following  goods
           and services, whether supplied directly  or  indirectly  by  the
           buyer free of charge or at reduced cost for  use  in  connection
           with the production and sale of such goods, to the  extent  that
           such value has not been included in the price actually  paid  or
           payable, shall be treated to be the amount  of  money  value  of
           additional consideration flowing directly or indirectly from the
           buyer to the assessee in relation to sale  of  the  goods  being
           valued and aggregated accordingly, namely:-

           (i) value of materials,  components,  parts  and  similar  items
           relatable to such goods;

           (ii) value  of  tools,  dies,  moulds,  drawings,  blue  prints,
           technical maps and charts and similar items used  in  production
           of such goods;

           (iii) value of material consumed, including packaging materials,
           in the production of such goods;

           (iv) value of engineering, development, art  work,  design  work
           and plans and sketches undertaken elsewhere than in the  factory
           of production and necessary for the production of such goods."




            A reading of Rule 6 shows that the value of the  goods  referred
      to in the Rule shall be deemed to be the aggregate of the  transaction
      value and the amount of money value of  any  additional  consideration
      that may flow directly or indirectly from the buyer to  the  assessee.
      Both parties relied upon the explanation to further their case.  Since
      the explanation is determinative of the present case, it is  important
      to note that where the master tape is supplied by the distributor  who
      is the copyright holder to the appellant, whether free of charge or at
      a reduced cost such master tape must be used in  connection  with  the
      production and sale of goods by the assessee.  What is clear from  the
      present transaction  is  that  the  master  tape  contains  within  it
      music/picture in digital form.  There is no doubt whatsoever that  the
      music/picture supplied on the master tape ought to be valued  and  has
      been valued as additional consideration that flowed from the buyer  to
      the assessee, and its value has been accepted at rupee one per CD.  So
      far as the royalty payable for such music is  concerned,  even  if  we
      agree with the learned counsel for the Department that such royalty is
      inextricably connected with the music and therefore would be  used  in
      connection  with  the  production  of  the  duplicate  CDs,  yet   the
      explanation requires that such use must not merely  be  in  connection
      with production but must also be in connection with the sale  of  such
      duplicate CDs.  As has been pointed out earlier in this judgment,  the
      entirety of the duplicate CDs is sold only to the distributor  who  is
      the copyright holder.  Obviously therefore the copyright value in  the
      duplicate CD is not used in connection with the  sale  of  such  goods
      inasmuch as no part of the copyright which may have been passed on  by
      the distributor to the assessee is used by the assessee in selling the
      duplicate CDs to the distributor who  is  himself  the  owner  of  the
      copyright.  Clearly therefore on the assumption that the music/picture
      embedded in the master tape is inextricably bound with  the  copyright
      thereof, the copyright is not “used” by the  appellant  while  selling
      the duplicate CDs to the distributor.  The distributor  having paid  a
      lump sum royalty to the producer of the music, then sells,  after  the
      job work done by the appellant, the duplicate CDs in the  market  with
      the cost of the royalty loaded thereon.

      8.    Clause (iv) of the explanation also  makes  it  clear  that  the
      value of art  work  or  design  work  on  goods  which  is  undertaken
      elsewhere than in the factory of the production and necessary for  the
      production on such goods alone must be  taken  into  account.  On  the
      assumption that the music/picture component is the  art  work  in  the
      master CD, that alone is to be taken into account as it  is  necessary
      for the production of the duplicate CDs.   Royalty  payable  for  such
      music/picture cannot extend to art work  that  is  necessary  for  the
      production of duplicate CDs, as no part of it is in  fact  taken  into
      account by either the distributor who is the copyright holder  or  the
      appellant in the job work done by the appellant.

      9.    Shri Lakshmikumaran relied upon two  judgments  of  this  Court.
      The  first  is  Joint  Secretary  to  Government  of  India  v.   Food
      Specialties Ltd., 1985 (22) E.L.T. 324 (S.C.).  The facts in this case
      were that the respondent entered into a number of agreements with M/s.
      Nestle Products (India) Limited and M/s. Nestle Holdings  Limited,  to
      manufacture for and on behalf of M/s Nestle Products  (India)  Limited
      sweetened condensed milk and other food products for sale in India  by
      Nestle under  certain  trademarks  in  respect  of  which  Nestle  was
      registered  as  the  sole  registered  user  in  India.   The   entire
      production of the respondent was purchased by Nestle and Nestle alone.
       Since the respondent  enjoyed  no  interest  in  the  trademarks  and
      labels, this Court held that such trademarks and labels cannot form  a
      component of the value of the goods for the purpose of  assessment  of
      excisable duty.

      10.   Similarly, in Sidhosons & Anr. v. Union of India & Others,  1986
      (26) E.L.T. 881 (S.C.), the appellants were  manufacturing  electrical
      goods which were labeled with the brand name “Bajaj” and sold  by  the
      appellant only to Bajaj Electricals Limited and  to  none  else.   The
      price fetched by the goods manufactured by the appellant was the price
      of the electrical goods without the brand name.  It was held:-

           “….The enhancement in the value of the goods by  reason  of  the
           application of the brand name is  because  of  the  augmentation
           attributable to the value of the  goodwill  of  the  brand  name
           which does not belong  to  the  manufacturers  and  which  added
           market value does not accrue to the  petitioner  company  or  go
           into its coffers. It accrues to the buyers  to  whom  the  brand
           name belongs and to whom the  fruits  of  the  goodwill  belong.
           Excise duty is payable in the market value fetched by the goods,
           in the wholesale market at the factory gate manufactured by  the
           manufacturers. It cannot be assessed on the basis of the  market
           value obtained by the buyers who also add to the  value  of  the
           manufactured goods the  value  of  their  own  property  in  the
           goodwill of the “brand  name”.  The  petitioners  are  therefore
           right and the respondents wrong.”




      11.   Both the aforesaid judgments, though decided before the  Central
      Excise Valuation (Determination of Price of Excisable Goods) Rules  of
      2000, go to show that the value of goodwill contained in a brand  name
      would not form part of the assessable value of goods that are produced
      and sold only to the owner of the goodwill.  In the present case,  the
      appellant also sells the duplicate CDs only to the distributor who  is
      the owner of the copyright, and this enhancement cannot  be  added  as
      part of the value of the goods sold in such cases.

      12.   The Tribunal relied upon a customs case reported  in  Associated
      Cement Companies Ltd. v. Commissioner of Customs, 2001 (128) E.L.T. 21
      (S.C.).  In that case, certain drawings and designs were received from
      abroad as part of technical collaboration and/or knowhow.   The  value
      of these drawings and designs was declared at a nominal value  of  one
      dollar because according to the appellant the drawings  by  themselves
      have no value and it is only the cost of the paper on which  they  are
      made that would have any value. On a reading of Rule 9(1)(b)(iv) which
      is similar to Rule 6 of the Central Excise Rules, this Court held:-

           “39. To put it differently, the legislative intent can easily be
           gathered by reference to the Customs  Valuation  Rules  and  the
           specific entries in the Customs Tariff  Act.  The  value  of  an
           encyclopaedia or a dictionary or a  magazine  is  not  only  the
           value of the paper. The value of the paper is in fact negligible
           as  compared  to  the  value  or  price  of  an   encyclopaedia.
           Therefore, the intellectual input in such items greatly enhances
           the value of the paper and ink in the aforesaid  examples.  This
           means that the charge of duty is on the final  product,  whether
           it be the encyclopaedia  or  the  engineering  or  architectural
           drawings or any manual.

           40. Similar would be the position in the case of a programme  of
           any kind loaded on a disc or a floppy. For example in  the  case
           of music the value of a popular music cassette is several  times
           more than the value of a blank  cassette.  However,  if  a  pre-
           recorded music cassette or a popular film or a musical score  is
           imported into India duty will necessarily have to be charged  on
           the value of the final product. In this behalf we may note  that
           in State Bank of India v. Collector of Customs [(2000) 1 SCC 727
           : (2000) 1 Scale 72] the Bank had, under an agreement  with  the
           foreign company, imported a computer software and  manuals,  the
           total value of which was US  $  4,084,475.  The  Bank  filed  an
           application for refund of customs duty on the  ground  that  the
           basic cost of software was US $ 401.047. While the rest  of  the
           amount of US $ 3,683,428 was payable only as a licence  fee  for
           its right to use the software  for  the  Bank  countrywide.  The
           claim for the refund of the customs duty paid on  the  aforesaid
           amount of US $ 3,683,428 was not accepted by this  Court  as  in
           its opinion, on a correct interpretation of Section 14 read with
           the Rules, duty was payable on the transaction value  determined
           therein, and as per Rule 9 in determining the transaction  value
           there has to be added to the price actually paid or payable  for
           the imported goods, royalties and the licence fee for which  the
           buyer is required to pay, directly or indirectly, as a condition
           of sale of goods to the extent that such royalties and fees  are
           not included in the price actually paid or payable. This clearly
           goes to show that when technical material is supplied whether in
           the form of drawings or manuals the same  are  goods  liable  to
           customs duty on the transaction value in respect thereof.

           41. It is a misconception to contend that what is being taxed is
           intellectual input. What is being taxed under  the  Customs  Act
           read with the Customs Tariff Act and the Customs Valuation Rules
           is not the input alone but goods whose value has  been  enhanced
           by the said inputs. The final product at the time of  import  is
           either the magazine or  the  encyclopaedia  or  the  engineering
           drawings as the case may be. There is no scope for splitting the
           engineering drawing or the encyclopaedia into intellectual input
           on the one hand and the paper on which  it  is  scribed  on  the
           other. For example, paintings are also  to  be  taxed.  Valuable
           paintings are worth millions. A painting or a  portrait  may  be
           specially commissioned or an article may  be  tailor-made.  This
           aspect is irrelevant since what is taxed is the final product as
           defined and it will be an absurdity to contend  that  the  value
           for the purposes of duty ought to be the cost of the canvas  and
           the oil paint even  though  the  composite  product,  i.e.,  the
           painting, is worth millions.”




      13.   This case is clearly distinguishable.  What was imported by  the
      appellant was not merely paper but drawings and designs on paper whose
      value had to be added for the  reason  that  the  appellants/importers
      were themselves going to exploit the intellectual content of the goods
      that were imported themselves.  In the facts before us the appellants,
      as has been pointed out above, do not exploit the intellectual content
      in the CDs produced by them by way of sale as the  sale  by  them  can
      only be to the copyright owner himself.  It is  clear  therefore  that
      this case would have no bearing on the present case.

      14.   Given the fact that no part of the royalty can be loaded  on  to
      the duplicate CDs  produced  by  the  appellant,  the  circular  dated
      19.2.2002 which deals with apportionment  of  royalty  would  have  no
      application to the facts of the present case.  In  the  circumstances,
      the impugned judgment dated 11.6.2004 is set aside.  Refund,  if  any,
      to be made of additional  duty  collected  pursuant  to  the  impugned
      judgment may be claimed by the appellant in accordance with law.   The
      appeal is allowed in the aforesaid terms.

                                              …………………….J.
                                              (A.K. Sikri)




                                              …………………….J.
                                              (R.F. Nariman)
      New Delhi;
      April 23, 2015.