This research article is written by Akshat Manish Mehta, a student of the Institute of Law, Nirma University, Ahmedabad. In this article he has tried to mention when freedom to enter into the contract could be limited or restricted because of Vitiated Consent, Unlawful Consideration or Unlawful Object through some of the sections mentioned under Indian Contract Act, 1872.


With the emergence of transitions and growth in businesses each and, every transition of the business arena is governed and regulated by Contract Law, in India through the Indian Contract Act, 1872. From mergers of huge telecommunications companies like Idea and Vodafone to a small employment contract between employer and employee, there is some sought of the relevance of Contract Law. 

Although everyone is absolutely free to make a contractual relationship with anybody but there are some restrictions when it comes to contracts, where one of the parties is acting under the fear or compulsion of other party or when one of the parties is at the higher bargaining positing which could affect the interests of other party to the contract. 

As per Section 10 of the Indian Contract Act, 1872 there are three conditions or requisites of the valid contract. These are:

  1. There must be Free Consent of the competent parties entered into the contract.
  2. There must be Lawful Consideration.
  3. There must be Lawful object

When any of the abovementioned condition is not fulfilled the contract could not come into existence and this is called the “limitation to the freedom of contract.” In this article I will try to mention when freedom to enter into the contract could be limited or restricted because of Vitiated Consent, Unlawful Consideration or Unlawful Object through some of the sections mentioned under Indian Contract Act, 1872.

Contract with a Minor

There is a limitation on the freedom of contact with minors, as per Section 11 of the Indian Contract Act, 1872, minor is not competent to a contract and the contract with the minor is void ab initio. In the case of ‘Sri Kakulam Subrahmanyam v. Kurra Subba Rao’, it was held that as per Section 8 of the Hindu Minority and Guardianship Act, 1956 guardian of a minor can enter into the contract on behalf of minor but only on two conditions:

  • Guardian must be competent to the contract.
  • It must be for the benefit of the minor.

Contract with the Person of Unsound Mind

As per Section 12 of the Indian Contract Act, 1872 contract could not be made with the person of Unsound Mind. The test of unsoundness of mind/mental capacity is:

  • Person is incapable to understand the consequences of the transition 
  • Person is incapable of understanding the nature of the transition. 

As per Section 12, a person who usually remains of unsound mind but occasionally becomes of sound mind, he could be allowed to enter into the contract when he is of sound mind. Also, if the person is usually of sound mind but becomes occasionally of unsound mind could not enter into the contract when he is in unsound state of mind. So this is the limitation to the freedom of contract mentioned under Indian Contract Act, 1872, with the person of unsound state of mind. 

Consent Induced by Coercion

As per Section 15 of the Indian Contract Act, 1872 Contract is said to be said Voidable as per Section 19, if the consent of either of the party is vitiated due to ‘COERCION.’ Coercion essentially includes two requisites:

  1. Consent is going to be obtained by pressure exerted by either of the following techniques:
    • Committing or threatening to commit any act forbidden by Indian Penal Code. 
    • Unlawful detaining or threatening to detain any property, to the prejudice of any person.

2)   With the intention of causing any person to enter into an agreement.

So if the consent of either of the parties is taken under the ‘Coercion’, then the contract is unenforceable. 

Consent Induced by Undue Influence

Section 16 of the Indian Contract Act, 1872 defines ‘UNDUE INFLUENCE.’ As per this section consent is said to be vitiated by undue influence if:

  1. One party is in a capacity to dominate the will of other party and it is done by that party for the unfair advantage.
  2. One party is in dominating position if either it has the real or apparent authority or there is some fiduciary relationship between the two parties. Dominion could also be established if the person is mentally ill and doesn’t have the mental capacity because of his age, illness, mental or bodily distress. 
  3. The burden of proof in the cases of Undue Influence lies on the party who is in the dominating position.

So if the consent of the party is taken by undue influence then the contract is rendered voidable under Section 19 of the said Act, at the option of the party whose consent is vitiated. 

Consent Induced by Fraud

There is a restriction in forming a contract if consent of one of the parties is taken by committing fraud. ‘FRAUD’ is defined under Section 17 of the Indian Contract Act, 1872, and it means and include any of the following acts committed by a party to the contract or his agent with the intention to deceive another party or to induce him to enter into the contract:

  1. When one party states a fact to which it knows that is not true. 
  2. Active concealment of the fact after having knowledge or belief of the fact. 
  3. A promise made by one party without the intention of performing it.
  4. Any Act done by the party which is fitted to deceive. (This clause has a much larger ambit)
  5. Any such Act or omission done by one of the parties which law specifically declares to be fraudulent.

If consent is taken under any of the five above mentioned conditions then the contract is rendered voidable as per Section 19, at the option of the party whose consent is vitiated by ‘fraud’. 

Consent Induced by Misrepresentation

Contract is voidable as per Section 19 of the Act, at the option of the party whose consent is vitiated by Misrepresentation. As per Section 18 of the Indian Contract Act, 1872, MISREPRESENTATION includes:

  1. When one of the parties to the contract makes a positive assertion about a fact which it believes to be true, but in actual it is not true. 
  2. There is no intent to deceive by that party but still the person or other person claiming under him gets an advantage and therefore that party misleads the other party to do its own prejudice. 
  3. Innocently causing another party to an agreement of the mistake which is of the very substance of the contract. (Same provision deals with Section 20 ICA, 1872)

Contract Induced with Mistake

As per Section 20 of the Indian Contract Act, 1872, when both the parties to the contract are at the mistake of matter of fact, which is very essential or substantial to the contract then the contract is Void. So this section again places a restriction on the freedom of parties to freely enter into the contract if either of the parties is induced by a mistake as to the subject matter of the agreement.

Contracts with Unlawful Considerations and Objects

Section 23 defines the consideration and object lawful only if:

  1. It is not forbidden by Law.
  2. It doesn’t defeat any of the provisions of the Law.
  3. It is not declared fraudulent.
  4. It should not involve any kind of injury to the person or property of another.
  5. It should not be regarded as immoral or opposed to the public policy by the courts.

The ambit of the 5th clause of the section i.e. ‘Public Policy’ is very large as it is a subjective term and interpreted in different ways in the court of law. So as per this section restriction or limitation on the freedom to enter into the contract is placed if the consideration or object to the contract is not lawful and comes under any of the above mentioned conditions. 

Other Contracts Debarred by Law

Freedom to enter in some specific types of contracts is forbidden by Law under some of the sections of Indian Contract Act, 1872. These are:

  • Any ‘contract in restraint of marriage’ of any person, other than minor is void as per Section 26 of the Indian Contract Act, 1872.
  • Any contract in which any individual is ‘restrained to lawfully exercising his lawful profession, trade or business’ is void as per Section 27 of the Indian Contract Act, 1872.
  • Any ‘contract in restraint of legal proceedings’ is explicitly declared void under Section 28 of the Indian Contract Act, 1872.
  • Agreements of any ‘nature of uncertainty’ are void under Section 29 of the Indian Contract Act, 1872.
  • ‘Agreements arising out by the way of wager’ is declared void under Section 30 of the Indian Contract Act, 1872. 


With the growing emergence of global business and commercial transitions there is a serious need to have a protection mechanism for the parties when one party could take undue advantage of the position of the other party. Some of the restrictions and limitations are explicitly mentioned in the Indian Contract Act, 1872 while could be found under various other statutes and legislations like Specific Relief Act, 1930 and Transfer of Property Act, 1882. 

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This Article is written by Akanksha Chowdhury from Amity University, Kolkata. The Article talks about International Humanitarian Law and also two important principles governing it.


International Humanitarian Law or IHL is known as the laws relating to war or the law of armed conflict, is a legal framework which is fully applicable to certain situations which are related to armed conflict and also occupation.[1] As a particular set of rules and regulations that aims for humanitarian grounds to limit the effects which came out due to armed conflict. IHL consists of two important principles:

  1. People who are not or no longer are participating in the hostilities must be given protection and;
  2. The rights of the parties belonging to an armed conflict so as to choose certain sort of methodologies and means of warfare that are not unlimited.

IHL is an important part of Public International Law. PIL or Public International Law is a broad setup of all the treaties, customs, principles and also certain norms which govern it. The traditional framework consists of relationships regulated only between the states. It evolved in order to cover a wide range of actors. International Humanitarian Law is very much notable under this aspect because it points out obligations for both state and also non- state armed forces which are parties to an armed conflict. It also even keeps a stricter watch in the activities during an armed conflict and even situations of occupations.[2] It is in a very different form and applies in any case of the body of law which is regulatory in the course of armed forces. This particular ideology is known as “jus ad bellum”. This particular maxim regulates all the conditions under which a force of action can be used named under Self- Defence and persistent to UN Security Council Authorization.

 A particular balance of humanity and military needs is visualised in the foundation IHL Rules of differential and proportionality. All the parties to a conflict under arms are fully needed to make a difference every time between civilians and non-civilians and also between civilian and military objects. On basis of this, attacks might not be launched if it is clearly done in order to cause damage to civilian life, injury or damage to any sort of civilian objects that would be too excessive with respect to the direct military advantage that is anticipated.[3] In addition to this, there are more IHL principles which include the duty of taking necessary precautions and to spare the civilised population before and during any sort of attack taking place and also during prohibitions of some indiscriminate nature of attacks to the civilians. [4]

Talking about two important sources, Treaties and Customary International Law are the ones which come under International Humanitarian Rules and Regulations. Treaties are a certain type of agreements between the states and those states which prepare a treaty are fully bound by all the terms mentioned. Although, a Non-State armed forces Group cannot sign any sort of treaty, IHL Treaty Rules as like as Common Articles Three and Protocol II applied to these actors. There are a huge range of IHL Rules which are considered in order to reflect certain Customary International Laws too. The International Committee of the Red Cross team had also published a detailed and analytical study and even created a structured database on customs International Law.

Rule of Military Necessity

Rule of Military is considered to be one of the important principles involved under International Humanitarian Law. A particular motion is reeled up within an entire framework of IHL which is known as none other than Rule of Military Necessity. This particular principle most of the times get clashed with respect to human opinions. Military necessity gives permission to the armed forces in order to engage around in a code of conduct which will result only in destruction and harm which will be dangerous. [5]This particular concept of military necessity has an acknowledging effect under laws of war, winning it or even a battle that is a lenient consideration point. But, the concept of Military Necessity does not give all the armed forces liberty to ignore all humanity consideration points together and do whatever they feel like because it is not at all accepted under this huge situation.

It must be clearly meant that in the context of specified prohibitions or stoppages are there with respect to all the principles of International Humanitarian Law.  It is really important to know a fact that the notion of Military Necessity itself is found within the IHL Rules. For instance, Article 52 of Protocol 1 jots down all the important objects which can be subject to lawful attacks. This important principle is like a related principle i.e. the principle of proportionality which is an important element of IHL.[6]

 This particular principle is really very important to be implemented because of the fact that we have to achieve a certain legitimate military purpose and are not prohibited through any sort or obligation under IHL. In the case of any conflicts only legitimate or legal military purpose is necessary so as to weaken up the military capacity which runs counter to the humanity exigencies. Under the exigencies of IHL and Statute of Romans, the death of common civilians during any sort of armed conflicts, no matter how deep or dangerous or unacceptable it us, does not constitute any sort of a war crime. [7]These two provisions permit some constitutional factors in order to carry out legitimate attacks against military objects, even though it is known of an important fact that it will lead to deaths of innocent civilians or even they might get severely injured.

A crime occurs under a fact when there is any sort of international attack launched against the civilians or attack launched under a military objective in order of a fact that there would be an immense loss for the civilians. Talking more about military necessity, it also involves usage of weapons, arms and all other sorts of things in order to launch a big attack on the military objective. The usage of weapons and all other things were considered in an international case of Ryuichi Shimoda et al. v. The State (1963).

This particular case is considered as an unsuccessful case which was brought up by five survivors of the Hiroshima and Nagasaki Atom Bomb attacks in order retaliate the US Government for causing a huge harm to the innocent lives and brining their life at a huge stake due to this big problem.

Principle of Proportionality

The principle of proportionality is an important factum which prohibits attacks against any military objectives which are expected in order to have an incidental type of loss to any civilian, injury to them, damage to the objects of civilians or any sort of combinations among both of them so as to prove an excessive relation to any sort of excessive military advantage. In other words, this principle seeks to minimise certain damages which are caused by certain dangerous military operations which are required to certain effects of means and methods used in warfare which must not be disproportionate in order to seek certain military advantages hereby. These set of principles in law tries to cover all sorts of important aspects which are really important and interlinked to each other proportionally.[8] This concept is used as a type of criteria of fairness and also justice in statutory interpretation procedure especially in the laws of the constitution as a logical method which intents to assist in creating a balance between restrictions imposed by corrective measures and severity of the punishment of any prohibited act. Within the ideologies in criminal law, it is actually used in order to convey an ideology so as to create punishment of an offender to fit under the crime. In IHL, there are several provisions which govern legal use of force during any armed conflicts, proportionality and differences are important factors so as to assess any military necessity.


Therefore, from these principles it is really clear that how International Humanitarian Law is an important element in governing systems of the country. The law of armed conflict seems torn between two fundamentally contradictory impulses – the need, on the one hand, to wage war effectively, and the desire, on the other hand, to protect people and property from the ravages of such warfare. The law of armed conflict attempts to reconcile these impulses, in a fundamentally pragmatic way. IHL compels States and non-State parties alike to do their utmost to protect and preserve the life, limb and property of civilians and others hors de combat, while at the same time giving parties to a conflict leave to commit acts of violence within certain boundaries.

[1],the%20effects%20of%20armed%20conflict.. (last viewed 27th July, 18:12)

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[5],battle%20is%20a%20legitimate%20consideration.. (last viewed 28th July, 16:39)

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This case analysis is written by Akshaya V, a student at CMR University, School of Legal Studies, Bangalore.


A person committing a tort (civil wrong) is held liable for damages. However, when the person to whom the harm is caused consents to the infliction of such harm, he is not liable for damages. Where the plaintiff voluntarily agrees to suffer some harm and has the knowledge of risk, his consent serves as a good defence against the defendant. Thus, whenever the plaintiff is aware of the possibility of harm which is likely to be caused by an act and when he agrees to suffer the harm, the defendant is taken out from his liability. This is known as volenti non-fit injuria. The instant case talks about the complete defence of volenti non-fit injuria that a defendant can enforce. 

Equivalent Citations

(1933) 1 KB 205


Lord Greer LJJ and Lord Scrutton. 

Year of Judgement 


Relevant Law 

Law of torts


Volenti non-fit injuria 


There was a motor racing track owned by the members of Brooklands Racing Club. The track was oval in shape and distanced two miles. It constituted a long stretch with the finishing line which was over a hundred feet wide. Spectators were allowed to view the races upon payment. Stands were provided for the spectators to view with safety, but many preferred to stand outside the railing. Among the competing cars, two cars were going in the finishing straight at about a hundred miles per hour. As they were approaching a sharp bend to the left, the car in front turned to the right and the other car did the same. While doing so, the car touched the offside of the former car and it shot into the air and fell into the railing, thereby killing two spectators and injuring others. In the history of racing, no such incident has happened. An action was brought by one of the defendants against the racing club for inviting the spectators to witness such a dangerous sport without giving notices or warnings. 


Did the defendant Company omit to give a warning for the safety of the spectator? 

Is the plea maintainable to hold the defendant liable? 

Points of Determination 

  1. The House of Lord determined that there was a failure on the part of the defendant to increase the height of the barrier, to keep spectators at a safe distance and to undertake special precaution after the incident. 
  2. The defendant company was held liable for inviting the public at large to witness this dangerous sport without giving warning of or protection from the dangers arising from the sport. 
  3. The burden of proof is on the defendant Company that the plaintiff had full knowledge of the extent of risk involved. 
  4. Many a time, the consent to inflict harm on oneself may be implied or inferred from the conduct of the parties. For instance, a person who agrees to drive on the highway is presumed to consent to the risk of an accident. Similarly, when a person is witnessing a motor car race shall not be able to recover damages in case of accidents, which may not be foreseeable. 
  5. The degree of an accident is always immeasurable and unknown. It shall be known only after the happening of an event but it is always extended to the worst case possible and consent for the same. It is similar to cases where a person has agreed to rescue a person from a restive horse, he has no action if the horse plunges on him more than usual. 
  6. For the defence of consent to be available, the act causing the harm must not go beyond the limit of what has been consented. For instance, if a surgeon negligently performs surgery, he cannot avoid the liability by pleading the defence of consent. 
  7. In the instant case, the consent given by the spectators extends to all the incidents (foreseeable and unforeseeable) inherent to the event of motor racing. 

The Ratio of the Case 

The defendant proved that this was the first time such an accident had taken place. The House of Lords decided that there was no negligence on the part of the motor car racing driver as such accidents were inherent in a racing event. When the spectators purchased tickets for witnessing the race, they had given implied consent. The doctrine of voluntary non-fit injuria was applicable since the victims had prior knowledge of the probable risks and had consented for the same. 


It was the duty of the defendants to take precautions on all the foreseeable aspects as a prudent and reasonable man would do in any case. However, the defendants are under no duty to guard against the risk that was not reasonably foreseeable or the danger which was inherent to the sport. The plaintiff impliedly took the risk of such injury at the time of purchasing the tickets. As no accident of this nature had previously occurred, it could not be reasonably foreseeable and therefore, the defendants were not required to prevent the risk of such an accident that no amount of due diligence would have revealed. The plea was not maintainable and the defendants were not held liable to provide damages to the injured plaintiff. 

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This article is written by Siddhi P. Nagwekar, a student of Karnataka State Law University’s Law School. This article discusses the General Principles of International Law and helps understand its functionalities as a source of International Law.


The ‘general principles’ can be regarded either as a descriptive or a prescriptive concept. From the descriptive perspective, they are abstractions from norms, belonging to legal meta-language, helpful in understanding the (international) legal system or parts of it. From the prescriptive perspective, they are norms, belonging to legal language, hopefully facilitating a holistic interpretation of the (international) legal system in a unitary way.

General principles of law are basic rules whose content is very general and speculative, sometimes boiled down to a maxim or a simple concept. As opposed to other types of rules such as enacted law or agreements, general principles of law have not been proposed according to the formal sources of law. Nevertheless, general principles of law are considered to be part of positive law, even if they are only used as additional tools. They account for essential rules for the very functioning of the system and, as such, are incorporated from the legal reasoning of those authorized to take legal decisions in the process of applying the law, notably the judiciary.[1]

The extent of general principles of law, to which Article 38(1) of the Statute of the ICJ refers, is unclear and controversial but may include such legal principles that are common to a sizable number of systems of municipal law. In view of the limitations of treaties or custom as sources of international law, Article 38(1) could be looked upon as a directive to the Court to fill any gap within the law and stop a non-liquet (a state of lawlessness) by reference to the general principles.

In previous stages of the development of international law, rules were often drawn from municipal law. In the 19th century, legal positivists dismissed the idea that international law may come from any source that excluded state will or consent but were ready to permit for the appliance of general principles of law, as long as they had in some way been accepted by states as a part of the legal order. Thus Article 38(1)(c), for example, talks about the general principles “recognized” by states. An area that exhibits the promotion of municipal means and methods is the law applied to the association between international officials and their engaging organizations,[2] although as of today the principles are considered as established international law.

The seriousness of general principles has indubitably been lessened by the increased strength of treaty and institutional relations among states. Nonetheless, the concepts of estoppel and equity have been utilized in the settlement of international disputes. For instance, a state that has, by its actions, helped encourage another state to believe in the existence of a particular legal or factual situation, and to rely on that belief, may be estopped from asserting a contrary situation in its dealings.[3] The principle of good faith was said by the ICJ to be “one of the basic principles governing the creation and performance of legal obligations”.[4] Similarly, there have been frequent references to equity.[5] It is by and largely agreed that equity cannot be employed to oust legal rules (that is, operate contra legem).[6] This “equity as law” perception is fortified by references to equitable principles in the text of the United Nations Convention on the Law of the Sea 1982, though this might be little more than an admission as to the existence, and legitimation, of the discretion of the adjudicator.

However, the principles of estoppel and equity in the international context fail to retain all the connotations they do under common law. The reference to the principles as “general” indicate that, if rules were to be adapted from municipal law, they should be at a sufficient level of generality to be inclusive of similar rules existing in many municipal systems. Principles of municipal law should be regarded as sources of inspiration rather than as sources of rules of direct application.[7] 

To understand what the General Principles really entail, it is important to look at the functions as they are perceived by theorists and applied in practice, whether by international judicial adjudication or as they emerge from customary practices in inter-state relations and international interaction. The most ardent proponent of this approach is probably Bin Cheng.

To this writer, there are minimum four functions that “General Principles” fulfil as a source of international law that is also corresponding to the other sources of international law. “General Principles” serve as:

  1. A source of interpretation for conventional and customary international law:   “General Principles” have been essentially used to define and expound international law. This interpretive function is the most widely recognized and applied function of “General Principles” and the one that is markedly the most required and helpful, contrary to the employing of “General Principles” as a method to supersede or remedy shortcomings in typical and customary international law. They can be counted upon to establish the rights and duties of States in the contextual, conventional, or customary law. This is specifically the case, for instance, with regard to principles like “good faith” and “equitable performance.” The range at which one can retreat to “General Principles” for interpretative aims has never been officially decided. Accordingly, “General Principles” can validly expand to fill gaps in conventional and customary international law and provide for as a supplementary source thereto.
  • A means for developing new norms of conventional and customary international law: This particularly is known as the ‘growth function’. Such an approach injects a contemporary element into international law. This arrests the static application of obsolete norms and procedures to what is admittedly a developing legal process devised to compose or regulate the dynamic exigencies and requirements of a community of nations with changing interests and varying goals and purposes. The development of new norms of conventional and customary law needed the existence of “General Principles.” As one author states: “From its legislative inception until the final determination, the law is a ‘continuing process’.”
  • A supplemental source to conventional and customary international law: Some say this is precisely one of the functions which the framers of article 38 had in mind when they included “General Principles” among the sources of international law. A practical outlook to this function of “General Principles” is that the judge, in the lack of an applicable rule of international law, so as to fill a legal gap, may utilize the principle extracted from the national legal systems which stand for the extensive systems of jurisprudence in the world, or from those systems whose legal traditions more apply to the specific case at hand. Criticism to this function can be made on the assertion that filling gaps in conventional and customary international law by retreating to “General Principles” erects a new law and hence alters the judicial process into a legislative one. In this regard, the general principles must meet what is known in criminal law doctrine as the “principles of legality,” which restrains judicial lawmaking. The predicament with regard to this function is identical to that of the national legal systems in which the judiciary is always on the lookout for the fair footing between strict and progressive legal interpretation.
  • A modifier of conventional and customary international rules:     This is the most controversial of the four functions. It is described as the corrective function. In this context, it would be employed to differentiate or modify provisions of conventional or customary law in favour of a greater good or higher cause. This statement highlights another important concept: the idea that jus cogens is based on the existence of a hierarchy of “General Principles”. Simply stated, in cases where the safeguarding of a fundamental interest is required, peremptory norms shall succeed over positive law. Peremptory norms are those which are said to have the highest place in the hierarchy of principles, and which must be accepted as overriding by the international community. With this status, they have the power to impose revision “in certain conventional and customary prescriptions to maintain the minimum coherence and content demanded of an international public order system”.


In conclusion, the ‘General Principles’ are recognized as a source of International Law in the statute of the International Court of Justice. However, there is little consensus about the processes and methods of identifying, appraising, and applying “General Principles” evidenced through various sources of international law. There is no easy formula that can be employed, but surely an agreed methodology could be recognized. What is needed, perhaps, is a convention to set out “General Principles of International Law,” much as the Vienna Convention on the Law of Treaties codified customary international law and those “General Principles” relating to treaty law.

[1] Marcelo Kohen,  Bérénice Schramm, General Principles of Law, last modified on 27 March, 2019, available at <>

[2] Amerasinghe, C., The Law of the International Civil Service, 2nd rev. ed, vol. 1 (Clarendon Press: Oxford, 1994) at 151–8.

[3] See North Sea Continental Shelf cases, note 6 at 26; Flegenheimer Claim 25 ILR 91; Case Concerning the Temple of Preah Vihear (Cambodia v Thailand) (Merits) [1962] ICJ Reports 6 at 32–3.

[4] Nuclear Tests Cases (Australia v France; New Zealand v France) [1974] ICJ Reports 253 at 268.

[5] River Meuse Case (Netherlands v Belgium) PCIJ Reports Series A/B No 70 76 at 76 per Judge Hudson.

[6] Case Concerning the Frontier Dispute (Burkina Faso v Republic of Mali) (Judgment) [1986] ICJ Reports 554 at 567–8; North Sea Continental Shelf cases, note 6 at 46–50.

[7] International Status of South-West Africa (Advisory Opinion) [1950] ICJ Reports 128 at 148.

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This article is written by Bhavna Arul, a fourth-year law student from Symbiosis Law School.


Indian Taxation law is a complex system; it is a source of revenue for the government. It is divided into two parts where one is governed by the central government and the other by the state government. Local authorities like Municipalities and the Local government also play a significant role in tax levied. Central Government controls the affairs of Income-tax, Central Goods and Service Tax, Customs Duty and Integrated Goods and Service Tax. Whereas, State government looks over State Goods and Service Tax and Stamp Duty Registration. 

India has a progressive system of tax, where the tax rates (percentage of tax payable) increase with an increase in income. The Income-tax Act 1961 governs income tax of an individual, firm, LLP, an association of person and any other artificial juridical person. To put in simple words, income tax is the tax on the income of a person. Tax is always calculated for the previous year in assessment year which is from 1st April to 31st March in India. 

Section 5 of Income Tax Act, 1961 provides Scope of Total Income in case of a person who is a resident, in the case of a person not ordinarily resident in India and person who is a non-resident which includes. Income can be Income from any source which-

 is received or is deemed to be received in India in such year by or on behalf of such person

accrues or arises or is deemed to accrue or arise to him in India during such year 

accrues or arises to him outside India during such year. 

To understand the definition of resident we shall first refer to section 6 of the Income Tax Act.

Section 6 of the Income Tax Act

This section lays down rules as to who can be considered a citizen under the Act for tax purposes. It is divided into various heads, namely- individuals, HUF/ LLP/ Firm and joint-stock companies.  

Residential status of Individual 

To determine an individual to be a resident or non-resident, we look at the basic conditions.

He is in India for the assessment year for 182 days or more. This 182-day period need not be a continuous need or in a single place in India. The number of hours of flight departure and arriving is also counted. The day of take-off and landing are also counted as within India. A person may be a resident of India and also a resident in another country or countries. 

He is in India for 60 days or more during the assessment year and 365 days or more during the previous year proceeding the assessment year. In all four years preceding the assessment year a total of 365 days he must be in India.

Basic condition 2 is not taken into consideration in the following cases: 

  1. A person leaving India for employment, business, job or profession purpose.
  2. If a person is of an Indian origin, visits India (e.g. – coming to India after generations settling abroad). In these cases, basic condition 2 is not applicable. They are known as special Individuals.

Additional Conditions- 

  1. Resident in India at least 2 out of 10 previous years immediately preceding the relevant assessment year.
  2. He has been in India for 730 days or more during 7 years immediately preceding the relevant assessment year. 

Additional condition 1 speaks about a resident, and additional condition 2 speaks about stay. Thus, additional condition to decide if the person is ordinarily resident Additional condition 1 has a pre-condition of “resident”. Additional condition 2 then deals with stay.

Residency Status of HUF/ LLP/ Firm

To decide whether HUF is resident or non-resident control and management of the HUF are taken into consideration. Either partial control and management or full control and management both are considered to be resident. In case of HUF the position of Karta is seen.

Residency Status of Joint-Stock Company

These are classified only as resident or non-resident. There is no specific division for an ordinary and non-ordinary resident. An Indian company is always a resident. In the case of a foreign company if gross receipt or turnover is more than 50 Cr and place of effectiveness is India, then it is considered a resident.

Incidence of tax based on Residential status

Income can be divided into 2 parts- Indian income and foreign income. Indian income is that which is earned in India. It includes income which is either earned in India or accrued, arises, deemed to accrue or arise and received outside India. 

TaxIncomeOrdinary residentNon ordinary residentNon resident
1.Indian IncomeYesyesYes
2.Foreign Income
Business income controlled from IndiaYesyesno
Business income not controlled from IndiaYesnono
Any other foreign IncomeYesnono
3.Passed untaxed profits remitted nowNonono

Section 5 of the Income Tax Act

Now that we have understood what a resident status is, we can go back to Section 5. As per the income tax laws, a person can have a total of 5 sources of income which are: Income from Salary, Income from House Property, Income from Business or Profession, Income from Capital Gains, Income from Other Sources. Gross total income is the sum of income from all 5 heads after setting off the losses under the relevant heads of income. Gross total income is to be categorized in 2 parts i.e. one which is to be taxed at normal slab rates and other which is subject to tax at specific rates.

Computation of Income from Employment

It will be gross salary as reduced by the aggregate amount of permissible deductions. It will be a part on due or receipt base whichever is earlier.

Permissible deductions:

  1. Amount of professional tax paid.
  2. Transport allowance to an extent.
  3. Prescribed special allowance or benefit in the performance of duties.
  4. Compensation under the voluntary retirement scheme.
  5. Amount of gratitude received on retirement or death.
  6. Amount received on the computation of pension
  7. Pension received by gallantry awards.

Head salary includes:

  1. Value of rent-free, or concessional accommodation provided by an employer.
  2. Value levied on travel concession.
  3. The amount received on encashment of unveiled leave on retirement or otherwise;
  4. The value of free or concessional medical treatment paid for or provided by the employee.

Computation of Income from House property 

It is not occupied for business or profession by its owner. Income from house property will be gross rent less specific deduction. Gross rent is calculated at 6% where the per cent is not specified, and the gross rent will be higher of the amount of contractual rent for the financial year. The gross rent of one self-occupied property is not taxed.

  1. The income of the property includes the plant and machinery in case it is inseparable.
  2. Permissible deduction
  3. Amount of taxes levied by a local authority and taxed on services, if paid.
  4. 20% of gross rent for repair and maintenance.
  5. Amount of interest paid on capital borrowed for construction, repair, and re-construction or renewing the property.

Computation of Income from Business

There are two modes of computation. In the first model taxable income is equal to business profits with specified adjustments. The second model is the income expense model where taxable income under the head will be equal to gross income minus allowable deductions for expenses. Income from the investment assets will be computed under the head capital gains. Ordinarily, all accrual and receipts derived from a business will form a part of gross earnings.

Computation of Capital Gain

Income from all investment assets comes under the head of capital gain. For the purpose of capital gain, certain transactions are not treated as a transfer. All capital gain between 1.04.1981 to 31.03.2000 will not be liable to tax. A general provision has therefore been made to the effect that the cost of acquisition of an investment asset shall be deemed to be nil if it cannot be determined or ascertained for any reason, and capital gains will be computed accordingly. A similar provision has been provided in respect of the cost of the improvement.

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This article has been written by Shivani Kumari, a first-year law student of Lloyd law college. The article enunciates about the transfer petition which is the remedy for the inconvenience suffered by one of the parties to a case and helps to transfer the case from one court to the other.


Transfer petition means prayer or request by one party to transfer his case from one court to some other court. When the party to a case finds inconvenience in any ground, he can file an application regarding the same to the court. The court on its discretion may approve or disapprove the application accordingly. The application here is known as a transfer petition.

A transfer petition is omnipresent in our judicial system as it refers to article 39A of the Indian constitution, section 21to25 under code of civil procedure hereinafter referred to as CPC and section 191, 402, 406, 407, and 408 under code of criminal procedure hereinafter referred as CrPC.

Format for Transfer Petition

1. Short synopsis

A short synopsis about the ground under which the party wants to seek transfer must be stated to the court.

2. Case brief

Detailed facts of the case must be specified in the transfer petition along with the court in which the case is to be transferred.

3. Grounds 

The grounds on which transfer is desired must be specified. Some of the grounds for instances are:

  • Threat to life
  • No support
  • Medical issues
  • Family issues
  • No income source

4. Interim relief

In pursuance of the transfer, the stay of proceedings can be sought.

Transfer Petition under Constitution

The Constitution is the backbone of the legal system in the Indian and the 42nd amendment of the constitution is known as mini-constitution of Indian because it has included many important provisions to the existing constitution along with the provision of 139a which is, transfer of certain cases. It enabled the citizens to approach the apex court to transfer their cases to another court in some other place or state provided they fulfil the conditions provided in the provision. For instance- Kk. Venkatapathi vs. state

According to Article 139a:

(1) Where cases involving the same or substantially the same questions of law are pending before the Supreme Court and one or more High Courts or before two or more High Courts and the Supreme Court is satisfied on its motion or an application made by the Attorney-General for India or by a party to any such case that such questions are substantial questions of general importance, the Supreme Court may withdraw the case or cases pending before the High Court or the High Courts and dispose of all the cases itself: Provided that the Supreme Court may after determining the said questions of law return any case so withdrawn together with a copy of its judgment on such questions to the High Court from which the case has been withdrawn, and the High Court shall on receipt thereof, proceed to dispose of the case in conformity with such judgment.

 (2) The Supreme Court may, if it deems it expedient so to do for the ends of justice, transfer any case, appeal or other proceedings pending before any High Court to any other High Court.

Transfer Petition under CPC

The code of civil procedure, 1908 was established in India to administer the civil proceedings. A transfer petition is explained under article 21- 25 of the CPC. Transfer petitions are filed here in cases of civil nature including family disputes, land disputes, torts, and many more.

Section 21: Objection to jurisdiction

 The court will entertain any appellate for the place of suing only if the objection is raised in the court of the first instance at the earliest possible opportunity or before issues are settled or before settlement or if there has been a consequent failure of justice.

Section 22

Power to transfer suits which may be instituted in more than one court

If a case can be instituted in more than one court then any defendant, after notice to the other party can apply to have suit transferred in another court. The court after considering the objection of another party can determine the jurisdiction for the same. But it should take place at the earliest possible opportunity.

Section 23: To what Court application lies

It gives the guidelines for filing an application to the court of actual jurisdiction.

Where several Courts having jurisdiction are subordinate to the same appellate court, then the application shall be made to the appellate court.

Where such Courts are subordinate to different appellate courts but the same high court then the application shall be made to the high court.

Where such Courts are subordinate to different high courts, the application shall be made the high court within the local limits of whose jurisdiction the court in which the suit is brought inset.

 Section 24: general power of transfer and withdrawal

After the application and other required procedures, the court may, at any stage transfer any suit, appeal or other proceedings pending before it for trial and may also withdraw any suit pending on any court subordinate to it.

Section 25: Power of the Supreme Court to transfer suits, etc.

Every application in this section shall be made by motion which shall be supported by an affidavit. After the application the other relevant procedure, if the Supreme Court satisfies, may at any stage direct that any suit, appeal or other proceedings be transferred from high court or another civil court in one state to a high court or civil court in any other state. This section also states that the court in which the suit is being transferred shall either re-try it or shall start from the place it was transferred to it.

Relevant cases for transfer petition under CPC

  • Harish Nagam vs. Krishna Veni Nagam
  • Deepak kumar singh vs. maniprabha
  • Kiran Ramanlal Jani vs Gulam Kadar
  • Kalpana Devi Prakash Thakkar vs Devi Prakash Thakkar

Transfer Petition under CrPC

The code of criminal procedure was enacted in 1973 and came into force on 1 April 1974. It is the procedure for the administration of substantive criminal law in India. It is extended to the whole of India except the state of Jammu and Kashmir. Section 191,402, 406, 407, and 408 explain the different forms of transfer petition which can be filed by accused, high courts, or the Supreme Court. These sections are further explained below:

Section 191: Transfer on an application of the accused

When a magistrate takes Cognizance of an offense, the accused shall, before any evidence is taken, be informed that his case can be inquired by another magistrate, and if the accused objects to further proceedings before the magistrate taking cognizance, the case shall be transferred to such other magistrate as may be specified by the chief judicial magistrate in his behalf.  

Section 402: Power of the high court to withdraw or transfer revision cases

Whenever one or more convicted at the same trial makes an application to the high court for the transfer of the case, the high decides whether the high court itself is going to deal with the case or should it be passed to any other session court. Whenever any application for revision is transferred to the high court, the court shall deal with it as duly made before itself and the same goes with session courts.

Section 406: Power of Supreme Court to transfer cases and appeals

The Supreme Court has got the powers to transfer criminal cases or appeals from one High Court to another or one Criminal Court to another. But the Supreme Court can act only on the application by the Attorney General, the advocate general of a state, or the application by the party interested. If the applicant is found frivolous the Supreme Court can claim compensation but that amount should not exceed Rs. 1000.

Section 407: Power of high court to transfer cases and appeals

Whenever an unfair and impartial trial takes place, some question of law of unusual difficulty arises, or the general inconvenience of the parties appears to a high court it may order and transfer the appeal from a criminal court to any other criminal court of equal or superior jurisdiction. The appealed case can also be tried before the High court itself provided that no application shall lie to the high court regarding the transfer of the case in the same session division.

Section 408: Power of session judge to transfer cases and appeals

The session judge has the power under this section to transfer a case from one criminal court to another criminal court in his session division. The sessions judge may act either on the report of the lower court or on the application of a party interested or his initiative.

Relevant cases for transfer petition under CrPc 

  • Maneka Gandhi vs. Miss Rani Jethmalani
  • Vikas Kumar Roorkewal vs State of Uttarakhand and others.


 A fair trial is one in which the rules of evidence are honoured, the accused has competent counsel, and the judge enforces the proper courtroom procedures i.e. a trial in which every assumption can be challenged. If the parties to a case are not satisfied with the courtroom procedure and if they are not able to raise each possible challenge then it is not considered to be a free and fair trial. People are not made for the law, it is the law that is made for the people. Thus, our judicial system provides provisions in which a case can be transferred from one court to the other considering the facts, circumstances, and procedure for the same.

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