TEAM CODE – 01

CMR VII NATIONAL MOOT COURT COMPETITON, 2020

IN THE HON’BLE SUPREME COURT OF INDIA

IN THE MATTER OF:

ZIGMA CORPORATION, INDIA…………………………………………..PETITIONER

V.

COLLECTOR OF STAMPS, MAHARASHTRA………………………….RESPONDENT

MEMORIAL ON BEHALF OF PETITIONERS

DRAWN AND FILED BY THE COUNSELS ON BEHALF OF THE PETITIONER

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 TABLE OF CONTENTS

INDEX OF AUTHORITIES

Cases cited:
• Prem Chand Garg v. Excise Commissioner, AIR 1963 SC 996.
• Daryao v. The State of Uttar Pradesh, AIR 1961 SC 1457;
• Tilokchand Motichand v. H.B. Munshi, AIR 1970 SC 898.
• Kharak Singh v. State of Uttar Pradesh, AIR 1963 SC 1295;
• Romesh Thappar v. The State of Madras, AIR 1950 SC 124
• Brij Mohan Lal v. Union of India, (2012) 6 SCC 571.
• Daryao v. State of Uttar Pradesh, 1962 SCR (1) 574.
• Sahibzada Saiyed Muhammed Amirabbas Abbasi v. The State of Madhya Bharat,
AIR 1960 SC 768;
• Naresh Shridhar Mirajkar v. State of Maharashtra, AIR 1967 SC
• Bennett Coleman & Company & Others v. Union of India and Others 1973 AIR 106
• Dwarkadas Shrinivas of Bombay v. The Sholapur Spinning & Weaving Company
1954 AIR 119
• Reserve Bank of India vs. Palai Central Bank Ltd. AIR 1961 Ker 26
• L.I.C. Of India & Anr vs Consumer Education & Research 1995 AIR 1811, 1995
SCC (5) 482

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 • Trimex International FZE vs Vedanta Aluminum Limited, India
• State of Delhi vs Mohd Afzal & Others, 2003(3) 11 JCC 1669
• State v Navjot Sandhu (2005) 11 SCC 600

Statutes refered:
 Constitution of India
 Maharashtra Stamp Act, 1958
 Indian Stamp Act
 Indian Contract Act, 1872
 Information Technology Act, 2000
 Indian Evidence Act, 1872
 Draft E Commerce Act, 1998

STATEMENT OF JURISDICTION

The petitioner has approached the hon’ble supreme court under article 32 of the constitution
of India, 1950.

Article 32 states-

(1) The right to move the Supreme Court by appropriate proceedings for the enforcement of
the rights conferred by this Part is guaranteed.

(2) The Supreme Court shall have power to issue directions or orders or writs, including
writs in the nature of habeas corpus, mandamus, prohibition, quo warranto and certiorari,
whichever may be appropriate, for the enforcement of any of the rights conferred by this
Part.

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(3) Without prejudice to the powers conferred on the Supreme Court by clauses (1) and (2),
Parliament may by law empower any other court to exercise within the local limits of its
jurisdiction all or any of the powers exercisable by the Supreme Court under clause (2).

(4) The right guaranteed by this article shall not be suspended except as otherwise provided
for by this Constitution.

STATEMENT OF FACTS

 ZigmaCorp Media Networks Limited (Zigma Media) is a private unlisted company,

incorporated on 26th February, 2011 under the Companies Act, 1956. Headquartered, in
Mumbai, Zigma Group’s revenue as of 31st March, 2018 stood at approximately INR
16,880 crores and is a major contributor to the Indian economy and the Digital India
program.
 ‘Zigma TV’ and ‘Zigma Money’, owned by Zigma Media are claimed to be India's most
watched english news channels since its launch. Zigma TV, stating nationalism as its core,
continued its pursuit of truth as its guiding principle and unearthed several scams and
contributed news reports fixing accountability for over a billion countrymen.
 On February 2, 2020, a rival media company reported the major violations at Zigma
Media including privacy related violations and non- compliance of the Zigma Digital.This
allegation did not stand scrutiny and rational, and was quickly dismissed by experts as
fiction. However, the privacy concerns surrounding Zigma Digital increased drastically,
resulting in the mobile application being uninstalled by its users. The statement issued by

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 Zigma Digital, lacking persuasion and seemingly unconvinced, a PIL was filed by the
Society for Internet Privacy before the Bombay High Court, on the basis of the ongoing
reports and urged the court to take suo motto cognisance of the matter, owing to larger
public interest, the Collector of Stamps, Maharashtra imposed a penalty of INR 196
crores on Zigma Media, for non-payment of stamp duty on execution of various
Agreements with Customer’s under various platforms operated, including the e-contracts
with 51 million unique users of Zigma Digital. The very next day, this became national
news and almost all the newspapers reported on it.
 There were talk shows and debates in all TV channels on violation of privacy and the
inadmissible e-contracts and click wrap agreements submitted by Zigma Media
Considering that the backlash and its loss of revenue was merely on the basis of an ill-
founded application of the statute governing stamp duty, Zigma Group filed a petition
before the Supreme Court claiming that the reputation and revenue loss was on account
of the actions of the Collector of Stamps, Maharashtra, which slapped a penalty and
thereby caused irreparable harm to its reputation both domestically and internationally.
Zigma Group questioned the applicability of the impugned statute on e-contract and click
wrap agreements.

STATEMENT OF ISSUES

• Whether the writ petition filed under art. 32 is maintainable before the hon’ble
supreme court of India?

• Whether the Maharashtra Stamp Act is applicable to e-contracts and click-wrap

agreements?

• Whether the act of the State Government violates the fundamental right guaranteed to
the petitioner under Art.19(1)(g)?

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 SUMMARY OF ARGUMENTS

ISSUE I

Whether the writ petition filed under Article 32 is maintainable before the hon’ble
supreme Court of India?

The instant petition is maintainable under Art. 32 of the Constitution since: first, the
fundamental right under Art. 32 is not qualified by the existence of any other local or
alternative remedies; second, the cases that impose a rule of exhaustion of local remedies are
not binding upon this Court and finally, there is a Constitutional obligation on this Court to
protect fundamental rights. In any case, the alternative remedies are not equally efficacious.

ISSUE II

Whether Maharashtra Stamp Act is applicable on e-contract and click wrap

agreements?

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It is humbly submitted that the impugned statute is not applicable to e-contracts and click
wrap agreements. This also implies that the case does not attract a outrageous amount of
penalty of rupees 196 crores.

The copies of e-contracts and click wrap agreements can very well be admitted in court as
evidence

ISSUE III

Whether, The Maharashtra Stamp Act, 1958 violates the fundamental right guaranteed
under Article 19 (1) (g)?

It is humbly submitted before the hon’ble court that The Maharashtra Act, 1958 is violative
of Article 19 (1) (g) of The Indian Constitution since company and its members are not
separate entities, denial of rights to companies which are available to citizen will amount to
denial of those fundamental rights to citizens who really constitutes these bodies. Hence, it is
the duty of the court to passed orders that may deem to fit in the light of justice.

ARGUMENTS ADVANCED

ISSUE I
The instant petition is maintainable.

It is submitted before the hon’ble court that the writ petition challenging the constitutional
validity of the Maharashtra stamp act is maintainable before the court. It is submitted that the
instant petition is maintainable [A] as there is a question of the validity of the impugned
statute [B] no requirement for the petitioner to exhaust local remedies [C] and in any case, the
alternative local remedies available to the petitioner are not equally efficacious.[D] there was
a violation of the fundamental right .

Question of the validity of the impugned statute;

The validity of an impugned statute can only be discussed in the supreme court and no other
court has the jurisdiction to decide on the matters related to the applicability of the issue.

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No requirement for the petitioner to exhaust local remedies;
The right to approach this Hon'ble Court in case of violation of fundamental rights is itself a
fundamental right enshrined in Art. 321. In Prem Chand Garg2, it was held that this right is
absolute and may not be impaired on any ground. Further, unlike in Art. 226, the remedy
provided by Art. 32 is a fundamental right and not merely a discretionary power of the
Court3. Moreover, this Hon’ble Court has on multiple occasions expressly rejected an
argument that called for exhaustion of local remedies4. Therefore, it submitted that it is not
open to this Court to carve out exceptions when there are none in the text.

The alternative local remedies available to the petitioner are not equally effacious;

It is submitted before the Hon’ble Court that the Writ petition challenging the Constitutional
validity of the Maharashtra Stamp Act is maintainable before the Court.
The petitioner has approached the Supreme Court under Art. 32 read with Art. 13(2) of the
Constitution of India. Art. 13(2) declares that the ‘State shall not make any law’ which takes
away or abridges the Fundamental Rights. Thus, the power of the legislature is limited by
Fundamental Rights of the citizens.5
Moreover, the petitioner need not establish either that he has no other adequate remedy or
that he has exhausted all other remedies provided by law, as Art. 32 is a Fundamental Right in
itself and therefore existence of an alternate remedy is no bar to the Supreme Court
entertaining a petition under it.6
Therefore, Articles 32 and 13(2) read together, along with the fact that the said Rules are
violative of Fundamental Rights under Art. 19(1)(a) and basic feature of the Constitution
make the case maintainable.

There was a violation of the fundamental right;

The fundamental right violation has been further dealt with in a separate issue altogether.

1
Constitution of India Art. 32 (1950)
2
Prem Chand Garg v. Excise Commissioner, AIR 1963 SC 996
3
Daryao v. The State of Uttar Pradesh, AIR 1961 SC 1457; Tilokchand Motichand v. H.B. Munshi, AIR
1970 SC 898
4
Kharak Singh v. State of Uttar Pradesh, AIR 1963 SC 1295; Romesh Thappar v. The State of Madras, AIR
1950 SC 124
5
Brij Mohan Lal v. Union of India, (2012) 6 SCC 571.
6
Daryao v. State of Uttar Pradesh, 1962 SCR (1) 574

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 Furthermore, judicial orders are not amenable to writ jurisdiction under Art. 32.7
Consequently, if a violation of Art. 32 takes place by this Court's rejection of the instant
petition, the petitioners will have absolutely no remedy for such violation of their
fundamental right. Hence, the Petitioner submits that a liberal approach should be adopted,
erring on the side of caution, in cases where the Court rejects a petition under Art. 32.

ARGUMENTS ADVANCED

ISSUE II

Whether Maharashtra Stamp Act is applicable on e-contracts and click-wrap

agreements?

The Indian Contract Act came into existence in 1872. E-contracts are a relatively newer
concept and haven’t explicitly been amended into the Act, nor do they have any other
legislation governing them.

Click wrap agreements are pop-up like displays that display the terms and conditions of the
use of their e-commerce platform, to which the user is required to give their consent by
clicking on an “I agree” button, after which they will be allowed to use the website. Largely
used in e-commerce websites, where plenty of transactions take place everyday, click-wrap
agreements do not entirely constitute a traditional contract that may require stamping. The pre

7
Sahibzada Saiyed Muhammed Amirabbas Abbasi v. The State of Madhya Bharat, AIR 1960 SC 768;
Naresh Shridhar Mirajkar v. State of Maharashtra, AIR 1967 SC 1.

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requisites of a Contract are consent, competence, offer, acceptance, lawful object and
consideration. Most of these elements cannot be checked in a clickwrap agreement as it is
more of an open and general offer. A terms and conditions agreement is not required by the
law but the internet is a vast place and a Terms and Conditions agreement is something
businesses use to protect both their businesses and users. A terms and conditions agreement
protects the business and the user by preventing abuses and banning or terminating users and
accounts that violate the usage of the internet space, helps own content and IP, sets governing
laws is and when needs to be adjudicated and most importantly, limits liability of the business
in case of errors.

Although a terms and conditions agreement is drawn up by businesses mostly to protect

themselves from any liability, in the case of a LIC India vs. CERN 8, the Supreme Court
struck down the contract in question since one of the parties had more bargaining power than
the other.

The fact that such a thing as a click-wrap agreement that dictates terms of use of a website
exists is enough of a proof how lacking our legislations are in respect to e-contracts. In the
current scenario, business methods are constantly upgrading and constantly evolving that
creates a pressing need for clear laws governing e-contracts, their validity and all other
aspects e-contracts. Click-wrap agreements are mere agreements between two private
individuals and more of an essential element for online businesses since there are no
demarcated laws regarding e-contracts.

The legislative intent of validating e contracts in in Trimex International FZE vs Vedanta

Aluminum Limited, India9 under section 10A of the IT Act10 was to ease businesses and to
not attract duty. Moreover stamping is a revenue generated by the government as a fee for
the physical stamp paper, which is not the case in e-contracts. On the national level, Section 4
of E Commerce Act11 states that electronic records shall not be liable to stamp duty. With the
ever increasing activity and transactions it is not feasible to stamp every electronic document.
It would be worthwhile to exempt general agreements from stamp duty to ease businesses and
transactions. This could ease documents from being impounded under Section 33 of the
MSA, which further makes them inadmissible as evidence under Section 34 of the MSA.

8
L.I.C. Of India & Anr vs Consumer Education & Research 1995 AIR 1811, 1995 SCC (5) 482
9
Trimex International FZE vs Vedanta Aluminum Limited, India, 2010 (1) SCALE 574
10
s\Dection 10A of the Informstion Technology Act, 2000
11
Section 4 of Draft E Commerce Act, 1998

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These long processes which are governed by ill found statutes, slow down the processes of
the courts delaying justice. In State of Delhi vs Mohd Afzal & Others12, it was held that
electronic records are admissible as evidence. The court observed that mere theoretical and
general apprehensions cannot make clear evidence defective and inadmissible. Further, under
the Indian Evidence Act, the term “document13” includes any information contained in an
electronic record which is printed on a paper, stored, recorded or copied in optical or
magnetic media produced by a computer. When fulfilling the conditions of Section 65B14 of
the Act, shall be admissible15 in proceedings, without any further proof or production of the
original document before the concerned authority and shall be regarded as an evidence of any
content of the original or any fact stated therein of which direct evidence would be
admissible.

ARGUMENTS ADVANCED

ISSUE III

Whether, the Maharashtra Stamp Act, 1958 violates the fundamental right of the
petitioner guaranteed under Article 19 (1) (g)?

Article 19(1) (g) of the Indian constitution allows citizen to “practice any profession, or to
carry on any occupation, trade or business”. The counsel on behalf of ‘Zigma Group’
contends that The Maharashtra Stamp Act, 1958 is violative of Article 19 (1) (g) of the Indian
Constitution.
A company being of Indian origin can enjoy the right guaranteed under Article 19 (1) (g),
there are various theories that proves that companies can be considered as citizen of the state.
The aggregate theory in BENNET COLEMAN AND CO. vs. UNION OF INDIA16, talks about
company being a fictional character which actually represents the interests of shareholders,
directors and others consisting natural entities. The theory was natural outgrowth of emphasis
on freedom of contract and it championed the cause that economic activity being private
activity, state should have minima role and corporate forms should be left open to market
forces. This theory is equivalent to the concept of lifting the veil and examining who actually
constitute such a company and under this theory co-extension of fundamental rights to
companies as those available to its members was argued. The court stated that certain
fundamental rights are available to the company.

12
State of Delhi vs Mohd Afzal & Others, 2003(3) 11 JCC 1669
13
Section 3 of Indian Evidence Act, 1872
14
Section 65 B of Indian Evidence Act, 1872
15
State v Navjot Sandhu (2005) 11 SCC 600
16
Bennett Coleman & Company & Others v. Union Of India and Others 1973 AIR 106

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In the SHOLAPUR SPINNING AND WEAVING COMPANY17, the court stated that
shareholder can come for enforcement of his right under Article 19 while the company itself
can come to court under Article 31 to challenge the impugned Act. However, the Bombay
high Court took a different stand and said, “When the nature of right is such that it cannot be
merely confined to natural persons then court must come to the conclusion that a corporation
is as much entitled to that right as an individual citizen”. Thus, the court allowed the petition
of infringement of fundamental rights under article 19 (1) (g) by the company holding such
company to be a citizen of India who is entitled to carry trade and business in India.
Another case to support my argument is in the case of RESERVE BANK OF INDIA Vs.
PALAI CENTRAL BANK LTD18. The Kerala High Court said that the intention of the framers
of the constitution was not to exclude corporate bodies from exercising all fundamental
rights. The fact that “Article 19 (1) (c) they gave all the citizens the rights to form
associations and unions, and it could not have been their intention that the corporate bodies
formed by citizens should be denied the rights guaranteed to the individual citizens. In
particular that the agencies through which a substantial portion of their business is conducted
by the citizens of this country and a considerable portion of their property held, should have
the protection of clauses (f) and (g)”. thus, the court admitted the petition filed by the Palai
Bank which challenged the validity of the Banking Companies Act on grounds of offending
Article 14 and 19 (1) (f) and (g). The court adopted a peculiar reasoning that denial of
fundamental rights to companies which are available to citizen will, “virtually amounts to a
denial of those fundamental rights to the citizens who really constitute these bodies.

It is humbly submitted that in the present case, the action of the collector of stamp,
Maharashtra has caused the zigma group a huge revenue loss, reputation loss both
domestically and internationally only on the basis of an ill- founded application of the statute
governing stamp duty. The action has also caused the circulation of newspaper of zigma
group to drop drastically and termination of contracts of other media groups with Zigma
groups. The Maharashtra Stamp Act, 1958 imposes unreasonable and excessive restriction on
the lawful business carried out by the Zigma Group and this desperate attempt by the
Collector of Stamp, Maharashtra is only to bring down Zigma Group.

In the light of the above mentioned reasons it is humbly requested that as citizens and
company are not separate entities and the Act is violative of Article 19 (1) (g), the court may
be pleased to passed any order that may deem to fit in light of justice.

17
Dwarkadas Shrinivas Of Bombay v. The Sholapur Spinning & Weaving Company 1954 AIR 119
18
Reserve Bank Of India vs. Palai Central Bank Ltd. AIR 1961 Ker 268

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 PRAYER

Wherefore in the light if issues raised, arguments advanced and authorities cited, it is humbly
prayed that this hon’ble court may be pleased to hold, adjudge and declare that;

1. That the writ petition under Art.32 is maintainable in the hon’ble Supreme Court of
India;
2. That Maharashtra Stamp Act is not applicable to e-contracts and click-wrap
agreements;
3. That the act of the State Government violates the fundamental right of the petitioner
under Art. 19 (i) (g);

and pass any other order as it may deem fit in the interest of justice, equity and good
governance.

All of which is humbly prayed.

TC – 01

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 Council for Petitioner

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