Taxation Law - Transfer Pricing – International Transaction – AMP Expenses – Absence of Agreement – No Adjustment Required – The Transfer Pricing Officer (TPO) treated AMP expenses incurred by the assessee as an "international transaction" for brand-building for its Associated Enterprise (AE) and made an adjustment – The ITAT held that the Revenue failed to establish the existence of an "international transaction" as defined under Section 92B of the Income Tax Act – Held: The existence of an international transaction cannot be inferred merely based on high AMP expenditure, and there must be an arrangement, agreement, or understanding between the parties to trigger transfer pricing provisions – ITAT's decision upheld [Paras 4, 10, 29-30].

Transfer Pricing – Benchmarking Analysis – Revenue’s Burden to Prove International Transaction – The Revenue contended that excessive AMP expenditure resulted in a transfer pricing adjustment – The Court held that before undertaking benchmarking analysis, the Revenue must first establish the existence of an international transaction with tangible evidence – Mere comparison with industry standards or other entities' AMP expenditures does not justify a transfer pricing adjustment – ITAT’s decision to quash the addition upheld [Paras 7, 23-24].

Bright Line Test – Not a Valid Basis for Transfer Pricing Adjustment – The TPO applied the "Bright Line Test" (BLT) to determine excess AMP expenditure benefiting the AE – The Court referred to the decision in Maruti Suzuki India Ltd. v. CIT and Sony Ericsson Mobile Communications India (P.) Ltd. v. CIT, reaffirming that BLT has no statutory basis and cannot be used to determine the existence of an international transaction – The Revenue's approach of inferring a transaction based on excess AMP expenditure rejected [Paras 26-27, 60, 62].

Transfer Pricing – Relationship with AE Alone Not Sufficient to Presume International Transaction – The Revenue argued that AMP expenditure benefited the foreign AE and thus should be considered an international transaction – The Court rejected this argument, holding that the mere existence of a parent-subsidiary relationship does not automatically imply an obligation to incur AMP expenses on behalf of the AE – The Tribunal's finding that no agreement or arrangement existed was upheld [Paras 9, 11, 29].

Decision: Appeals dismissed – ITAT’s order upheld – Transfer pricing adjustment on AMP expenditure deleted – Revenue failed to establish the existence of an international transaction.

Matrimonial Criminal Law - Criminal Revision – Domestic Violence Allegation – Acquittal by Appellate Court – Revision Dismissed – Applicant alleged assault and verbal abuse by her husband, leading to trial court conviction under Section 323 IPC – Appellate Court reversed conviction, giving benefit of doubt citing delay in lodging FIR, lack of injury, and contradictory witness testimony – High Court upheld acquittal, holding findings not perverse and based on evidence on record [Paras 2–9].
Delay in FIR – Five-Day Delay Without Proper Justification – Benefit of Doubt Given – Court observed that though delay alone is not fatal, in matrimonial disputes, unexplained delay weakens prosecution case – Further, FIR lodged in different district than where incident occurred, creating doubt about credibility – Held: Delay contributed to acquittal [Paras 7–8].
Contradictory Testimony – Independent Witness Did Not Support Prosecution – Acquittal Justified – Key prosecution witnesses including the complainant’s own father and independent witnesses did not support her version – Court noted that testimony of complainant alone was insufficient to sustain conviction in light of these contradictions [Paras 8–9].
Revisional Jurisdiction – Interference in Acquittal – Only When Finding is Perverse – Court reiterated that revisional powers must be exercised sparingly – Unless the findings of the appellate court are perverse or against the weight of evidence, revision is not maintainable – No such perversity found in this case [Para 9].
Decision – Acquittal Upheld – Revision Dismissed – The High Court declined to interfere with the judgment of the appellate court acquitting the husband under Section 323 IPC – Revision petition dismissed at admission stage itself [Para 10].
 

Divorce on Grounds of Cruelty – Denial of Education – Section 13(1)(ia) of the Hindu Marriage Act – Wife alleged that she was subjected to mental and physical cruelty, including coercion to discontinue her education and demand for dowry – Husband denied allegations and contended that he supported her studies – Trial court ruled in favor of husband, holding that cruelty was not established – High Court reversed the decision, holding that preventing a spouse from pursuing education or creating conditions that obstruct education amounts to mental cruelty, justifying divorce [Paras 16-22].

Mental Cruelty – Objective Assessment – Court emphasized that cruelty need not be intentional – It is sufficient if the conduct of one spouse causes anguish, frustration, or humiliation to the other – Relying on Shobha Rani v. Madhukar Reddy and Praveen Mehta v. Inderjit Mehta, the Court held that the husband's actions amounted to mental cruelty, warranting dissolution of marriage [Paras 14-20].

Irretrievable Breakdown of Marriage – Justification for Divorce – Parties lived separately for over eight years – Mediation efforts failed at both trial and appellate stages – Court held that forcing the parties to continue the marriage would serve no purpose – Decreed that the marriage should be dissolved in light of long separation and irreconcilable differences [Paras 21-23].

Restitution of Conjugal Rights – Unjustified Decree – Section 9 of the Hindu Marriage Act – Husband’s claim for restitution was based on the assertion that the wife left without reasonable excuse – High Court held that compelling a spouse to discontinue education and endure an unwelcoming environment constitutes a valid reason to live separately – Decree for restitution of conjugal rights set aside [Paras 22-23].

Final Decision – Appeals allowed – Marriage dissolved on the ground of mental cruelty under Section 13(1)(ia) of the Hindu Marriage Act – Trial court's decree rejecting divorce petition set aside – Decree for restitution of conjugal rights in favor of husband also set aside [Paras 23-24].
 

Contempt of Court – No Willful Disobedience – Supervening Circumstances Justified Delay - The petitioner alleged that the respondents failed to distribute the collected ‘Dakshina’ among the three managing families of the temple as per the 2018 High Court judgment – The respondents contended that distribution was temporarily halted due to an internal dispute among family members and the impact of the COVID-19 pandemic – The High Court held that the delay was due to legitimate administrative and legal hurdles, and there was no deliberate violation of the court’s order – Held: Mere delay, without intent to defy the court, does not amount to contempt [Paras 12-13].

Judicial Directives for Temple Administration – Compliance Achieved – Contempt Petition Infructuous - The Court examined records and found that post-2023, the respondents resumed the daily counting and monthly distribution of ‘Dakshina’ as per the 2018 judgment – Evidence of deposits and withdrawals from bank accounts confirmed compliance – Held: Since the court’s directives were now being followed, no further action was necessary, and the contempt petition was closed [Paras 11-13].

Locus Standi in Contempt Proceedings – Petitioner’s Standing Disputed – No Proof of Membership in Managing Families - The respondents argued that the petitioner was not a direct party to the original writ petition and had not proven his status as a beneficiary – The Court noted that a contempt petition can only be filed by a party with a direct grievance regarding non-compliance – Held: Though the petitioner’s membership in the managing families was in dispute, the issue was moot since compliance had already been ensured [Paras 6-7].

Decision – Contempt Petition Dismissed – No Further Action Required - The Court found no willful disobedience of its 2018 judgment and dismissed the contempt petition – Held: The petitioner’s claims were now irrelevant as compliance had been established, and the case was closed [Paras 13-15].
 

Bail - NDPS – Charge Sheet Without FSL Report – Bail Granted - The petitioner was arrested for possession of 300 grams of MDMA and remained in custody for nearly a year – The prosecution filed a charge sheet without an accompanying Forensic Science Laboratory (FSL) report – The Court held that in cases under the NDPS Act, a chemical analysis report is an integral part of the investigation, and without it, the charge sheet is incomplete – Held: Since the Supreme Court is considering the issue of charge sheets being filed without FSL reports, and in similar cases bail has been granted, the petitioner is entitled to bail [Paras 6-7].

Long Pre-Trial Detention – No Trial Commenced – Bail Cannot Be Denied Indefinitely - The petitioner was in custody since 29.03.2023 and was granted interim bail on 13.03.2024 – The trial had not yet commenced – The Court held that prolonged pre-trial detention without progress in trial proceedings violates the petitioner’s rights – Held: The interim bail order was made absolute, and the petitioner was directed to attend trial proceedings regularly [Paras 5-6].

Conditions for Bail – Compliance with Court Directives Required - The High Court imposed conditions, including surrendering the passport, refraining from influencing witnesses, and appearing before the trial court on scheduled dates – Held: Violation of any condition would result in the cancellation of bail [Para 7].

Decision – Bail Granted – Interim Order Made Absolute - The Court made the interim bail granted on 13.03.2024 absolute and directed the petitioner to comply with all bail conditions, keeping the legal issue of FSL reports open for future determination [Para 7].
 

Civil Law - Negative Declaratory Relief – Suit for Declaration of Non-Marital Status – Maintainability – Section 34 of the Specific Relief Act, 1963 – Defendant contended that a suit seeking a declaration that no marriage exists is barred under Section 34 – Court held that a suit for declaration of legal status is maintainable under Section 9 CPC, irrespective of the provisions of Section 34 of the Specific Relief Act – Legal character includes marital status, and a suit seeking a declaration of non-marriage is within the jurisdiction of the civil court [Paras 10-12, 17-18].

Jurisdiction of Civil Courts – Declaratory Relief Outside Specific Relief Act – Plaintiff argued that relief could be sought under Section 9 CPC, which grants civil courts broad jurisdiction – Court held that declaratory relief is not confined to Section 34 of the Specific Relief Act – Civil courts can grant such declarations independently [Paras 15-16].

Conflicting High Court Views – Reliance on Supreme Court Precedent – Karnataka High Court had previously held in Bhuvaneshwari v. Revappa that such suits are not maintainable – Calcutta High Court in Joyita Saha v. Rajesh Kumar Pande ruled otherwise – Court followed Supreme Court’s ruling in Balram Yadav v. Fulmaniya Yadav, which held that a suit for a declaration regarding marital status, whether affirmative or negative, is maintainable [Paras 19-21].

Consequential Relief – Not Always Necessary – Defendant argued that a suit for mere declaration without consequential relief is barred by the proviso to Section 34 – Court held that in cases concerning marital status, the declaration itself is a substantive relief and need not be accompanied by additional claims [Paras 24-25].

Court’s Decision – Suit for Declaration of Non-Marriage Maintainable – Rejection of plaint under Order VII Rule 11 CPC not justified – Civil courts have jurisdiction to entertain such suits – Revision application dismissed [Paras 22-25].

Civil Law - Eviction – Default in Payment of Rent – Section 12(1)(a) of the M.P. Accommodation Control Act, 1961 – Eviction Decreed – The plaintiffs/landlords filed a suit for eviction on the ground of non-payment of rent, alleging that the tenant was in arrears since 01.09.1982 – The tenant disputed the rate of rent and claimed an agreement for adjustment of house tax against rent – The Trial Court fixed provisional rent at Rs.12/- per month under Section 13(1) of the Act, which the tenant failed to deposit – The suit was dismissed by the Trial Court and affirmed by the First Appellate Court – Held: The tenant's failure to deposit rent as per the court’s provisional order amounted to default, making him liable for eviction – Courts below committed an error in ignoring the mandatory compliance under Section 13(1) – Substantial question of law answered in favor of the landlords – Eviction decree granted with a two-month period to vacate [Paras 12-17].

Motor Accident – Rash and Negligent Driving – Tribunal erred in dismissing the claim for non-examination of eyewitness – Accident proved through FIR, post-mortem report, and police investigation – Criminal acquittal of respondent No.1 not binding on Tribunal – Negligence proved on touchstone of preponderance of probabilities – Claimant entitled to compensation [Paras 9-17].

Standard of Proof – Proceedings under the Motor Vehicles Act – Tribunal wrongly insisted on strict proof as required in criminal trial – Held: Strict rules of evidence do not apply in claim petitions – Tribunal is to decide claims on the basis of preponderance of probabilities and not proof beyond reasonable doubt – Judgment in Sunita vs Rajasthan State Transport Corporation followed [Paras 11-14].

Driving Licence – Validity of LMV Licence to Drive Tractor – Tribunal’s finding that respondent No.1 did not possess valid licence is contrary to law – As per Supreme Court in Bajaj Allianz vs Rambha Devi (2024 INSC 840), a driver holding LMV licence is competent to drive transport vehicles below 7500 kg including tractors – Issue No.3 answered against the Insurance Company [Paras 23-25].

Criminal Acquittal – Not Binding on Tribunal – Criminal acquittal of the driver by giving benefit of doubt does not ipso facto absolve him of civil liability under the Motor Vehicles Act – Tribunal ought to have independently appreciated evidence – Supreme Court’s ruling in N.K.V. Bros v. M. Karumai Ammal applied [Paras 14-15].

Compensation – Computation – Minimum wages considered as basis of income – Future prospects added @40% – Deduction of 50% towards personal expenses applied – Multiplier of 17 adopted considering age of deceased at 28 years – Compensation awarded under conventional heads following Pranay Sethi and Magma General Insurance Co. v. Nanu Ram [Paras 18-21].

Decision – Appeal Allowed – Award dated 06.08.2005 set aside – Claimant entitled to total compensation of ₹3,55,320/- with interest @9% per annum from date of petition till realization – Insurance Company directed to deposit compensation within two months – Costs imposed for non-appearance of counsel also addressed [Paras 26-30].

Motor Accident Compensation – Enhancement of Income – Application of Minimum Wage Notification – Future Prospects and Deduction Adjusted – Compensation Enhanced - Tribunal treated the deceased, a building material shop owner, as a casual labourer due to absence of income proof and applied minimum wage of ₹6,000/- – Court held that minimum wage applicable at the time of the accident was ₹7,200/- as per government notifications – Deduction for personal expenses reduced to 1/4th as deceased left behind four dependents including an unborn child – Tribunal correctly applied multiplier of 18 – Future prospects added at 40% following Pranay Sethi – Total compensation enhanced to ₹18,12,960/- [Paras 6-7].

Unborn Child – Entitlement to Compensation – Included as Dependent - The deceased's widow was pregnant at the time of the accident – The male child born later was held entitled to be treated as a dependent and eligible for compensation under the MV Act – Court followed settled law that unborn children are also entitled to compensation if born alive [Para 6].

Conventional Heads – Omission Rectified – Consortium and Loss of Estate Compensation Awarded - Tribunal failed to award compensation for loss of estate and consortium – High Court awarded ₹1,44,000/- under loss of consortium (₹48,000 x 3 for widow, mother, and minor son) and ₹18,000/- each for funeral expenses and loss of estate – Computation of compensation realigned as per Sarla Verma, Pranay Sethi, and Magma General Insurance guidelines [Paras 6-7].

Final Award – Compensation Enhanced – Interest Modified - Total enhanced compensation fixed at ₹18,12,960/- with an additional ₹9,29,000/- payable to the appellants along with interest at 7.5% p.a. from the date of claim petition till realization – Appeals allowed and disposed [Paras 8-9].