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 RESPONDENTS

DRAWN AND FILED BY THE COUNSELS ON BEHALF OF THE RESPONDENTS

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 TABLE OF CONTENTS

INDEX OF AUTHORITIES

Cases Cited

• Union of India v. Paul Manickam, AIR 2003 SC 4622.

• A.V. Venkateshwaran v. R.S.Wadhwani AIR 1961 SC 190
• Andhra Industrial Works v. Chief Controller of Imports, AIR 1974 SC 1539.
• Fertilizer Corp. Kamgar Union v. Union of India, AIR 1981 SC 344.
• Calcutta Gas Co. Ltd. v. State of West Bengal, AIR 1962 SC 1044.
• Mohammed Ishaq v. S. Kazam Pasha, (2009) 12 SCC 748.
• State of West Bengal v. Ratnagiri Engineering Private Limited, (2010) 4 SCC 453.
• Chitranjit Lal Chowduri v. The Union of India and Others 1951 AIR 41
• Jupiter General Insurance Company v. Rajagopalan and Another case. AIR 1952 P H
9
• State Trading Corporation of India Ltd & others v. The commercial tax officer,
Visakhapatnam
 and others 1963 AIR 1811
• Tata Engineering and Locomotive Co. v. State Of Bihar and Others 1965 AIR 40
• Jaipur Udhyog Ltd. v. Union of India and others AIR 1975 SC 1056
• V. Rev. Mother Provincial v. State of Kerala and others 1970 AIR 2079

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 • Trimex International FZE vs Vedanta Aluminum Limited, India, 2010 (1) SCALE
574
• Bhagwandas Goverdhandas Kedia v. Girdharilal Parshottamdas 1966 AIR 543, 1966
SCR (1)
 656
• M/S Sms Tea Estates P.Ltd vs M/S Chandmari Tea Co.P.Ltd. (2011) 14 SCC 6
• Omprakash vs. Laxminarayan & Ors. [2014(1) SCC 618]
• Garware Wall Ropes Ltd v. Coastal Marine Construction & Engineering Ltd 2019
SCC OnLine
 SC 515
 1 Chitranjit Lal Chowduri v. The Union of India and Others 1951 AIR 41
 2 Jupiter General Insurance Company v. Rajagopalan and Another case. AIR 1952 P
H9
 3 State Trading Corporation of India Ltd & others v. The commercial tax officer,
Visakhapatnam and
 others 1963 AIR 1811
 4 Tata Engineering and Locomotive Co. v. State Of Bihar and Others 1965 AIR 40
 5 Jaipur Udhyog Ltd. v. Union of India and others AIR 1975 SC 1056
 6 V. Rev. Mother Provincial v. State of Kerala and others 1970 AIR 2079

Statutes refered:

• Constitution of India
• Maharashtra Stamp Act, 1958
• Indian Stamp Act,
• Indian Contract Act, 1872
• Information technology act, 2000
• Indian Evidence act, 1872
• Finance Act, 2019
• Draft E Commerce Act, 1998

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 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 31stMarch, 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 Zigma Digital, lacking

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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 interestThe 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 not maintainable since the Petitioner has not exhausted all available
local remedies before approaching this Hon’ble Court under Art. 32. The rule of exhaustion
of local remedies is a self-imposed restraint created this Hon’ble Court and is not a violation
of Art. 32. The Petitioner can approach the High Court under Art. 226 which would be able to
ascertain local conditions and facts and ensure proper compliance with its orders as it
possesses the requisite expertise in these matters. In any case, in any case, no fundamental
rights have been violated.  

ISSUE II

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

It is submitted that the impugned statute, The Maharashtra Stamp Act, 1958 is applicable to
e-contract and click-wrap agreements. Hence, the Collector of Stamps may impose a penalty

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for a lack of stamp duty. Moreover, the remittance of fine only furthers the cause of the case
by enabling e-contracts and agreements to be admissible 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 Stamp Act, 1958 is not
violative of Article 19 (1) (g) of The Indian Constitution since a company and its members
are two separate entities and member of the company cannot claim infringement of
fundamental rights on behalf of the company unless it infringes their own rights too. The
Supreme Court have clearly explained in a case that corporate bodies are juristic persons and
so they cannot be termed as citizens though they may be of Indian nationality due to
incorporation in India. Corporate body being Indian national is entitled to civil rights
accruing from international law but such corporate body is not a citizen. Hence, it is not
entitled to any particular right available only for citizen like that under Article 19.

ARGUMENTS ADVANCED

ISSUE I

Whether the petition filed before the hon’ble supreme court is maintainable?

It is humbly submitted before the hon’ble court that the instant matter is not Maintainable
before the court of law. The petitioner lacks the essential ingredients to Maintain the matter
before the apex court. Certain issues regarding maintainability of the case must be
highlighted Before this court to prevent any miscarriage of justice.

1.1 The writ petition submitted is not maintainable;

No action lies in the supreme court under art. 32 unless there is an Infringement of a
fundamental right1, As the supreme court has previously Emphasized that “the violation of
fundamental right is the sine qua non of The exercise of the right conferred by art. 32.”2 In the
given case, it was the Act of the petitioner which breached the ethics of media world which
Consequently attracted penalty and loss of reputation and hence no fundamental right has

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been Infringed. In addition to this, a person acquires a locus standi, when he has to have a
Personal or individual right which has been violated3 or threatened to be Violated. since, no
right of petitioner has been infringed, he has no locus Standi before the court. This hon’ble
court has itself imposed a self-restraint in its own wisdom on The exercise of jurisdiction
under art. 32 where the party invoking the Jurisdiction has an effective adequate alternative
remedy in the form of art. 226 of the constitution, although this rule is a rule of convenience
and Discretion rather than a rule of law.4 but, where writ petition is challenging The
constitutional validity of any provision, then the petitioner should file writ Petition before
high court under art. 226 of the constitution.15
Moreover, in order to invoke the jurisdiction under Art. 32 of the Constitution to approach
this Court directly, it has to be shown by the petitioner as to why the High Court has not been
approached, could not be approached or it is futile to approach the High Court. Unless
satisfactory reasons are indicated in this regard, filing of petition in such matters directly
under Art. 32 of the Constitution is to be discouraged6. Hence, it is submitted that the petition
submitted before this Hon’ble Court is not maintainable and thus should be rejected.

1.2 .Alternative remedy has not been exhausted

The high courts are competent enough to hear this particular case by the virtue of L.
Chandrakumar V. Union of India7. Alternative remedy is a bar unless there was
complete lack of jurisdiction in the officer or authority to take action impugned8,
however, the existence of a competent body9 to hear this particular case questions the
maintainability of the writ petition filed. It was held this Hon’ble apex court in Asstt.
Collector of Central Excise v. Jainson Hosiery10 where there is alternative statutory
remedy court should not interfere unless the alternative remedy is too dilatory or
cannot grant quick relief. Thus, the respondents humbly submit that the present writ
petition is not maintainable on the ground that alternative remedy has not been
exhausted. Thus, the respondents submit that the present writ petition in not
maintainable for the aforesaid reasons.2

1
1 Andhra Industrial Works v. Chief Controller of Imports, AIR 1974 SC 1539.
2 Fertilizer Corp. Kamgar Union v. Union of India, AIR 1981 SC 344.
3 Calcutta Gas Co. Ltd. v. State of West Bengal, AIR 1962 SC 1044.
4 Mohammed Ishaq v. S. Kazam Pasha, (2009) 12 SCC 748.
5 State of West Bengal v. Ratnagiri Engineering Private Limited, (2010) 4 SCC 453.
2
6 Union of India v. Paul Manickam, AIR 2003 SC 4622.
7 AIR1997SC1125 ¶ 94
8 A.V. Venkateshwaran v. R.S.Wadhwani AIR 1961 SC 1906

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 ARGUMENTS ADVANCED

ISSUE II

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

agreements?

Maharashtra Stamp Act, 1958 is applicable to e-contracts and click wrap agreements.

E-contracts and traditional paper based contracts are conceptually very similar. Although the
Indian Contract Act, 1872 does not provide for E-contracts, it also does not prohibit them.
The only pre requisites of a Contract being consent, competence, offer, acceptance, lawful
object and consideration, which can be fulfilled in written or oral form. All these pre
requisites are fulfilled by an E-contract and under section 10A of the IT Act, 2000 3, in
Trimex International FZE vs Vedanta Aluminum Limited, India 4, E-Contracts have been
held valid and enforceable.

Largely used in the e-commerce field, click wrap agreements display the terms and
conditions of the use of their e-commerce platform, to which the user is required to either
9 High Court Of Maharashtra
10 AIR 1979 SC 1889
3
10A of Information Technology Act, 2000
4
Trimex International FZE vs Vedanta Aluminum Limited, India, 2010 (1) SCALE 574

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deny the terms and exit the domain or give their consent by clicking on an “I agree” button.
Once the user continues to use the website, it constitutes implied consent. Hence, establishing
a Contract. Click-wrap contracts are purely digital and going by Section 10A of IT Act, click
wrap agreements are not unenforceable due to being digital. It was held on account
of Bhagwandas Goverdhandas Kedia v. Girdharilal Parshottamdas,5 “that ordinarily, it is
the acceptance of offer and intimidation of that acceptance which results in a contract. This
intimation must be by some external manifestation which the law regards as sufficient.
Hence, even in the absence of any specific legislation validating e-contracts cannot be
challenged because they are as much valid as a traditional contract is.” Just like a contract, a
click-wrap contract is enforceable under Indian Law.

Collector of Stamps may impose Penalty due to lack of payment of stamp duty

Due to the absence of legislations governing stamping of e-contracts, they have not been
required to be stamped compulsorily. However, the last amended MSA6 when read with the
latest Finance Act, 2019 7, that amends the definition of instruments to include electronic
documents, ascertains the necessity to pay stamp duty for all instruments, including e-
contracts and click-wrap agreements.

According to Section 33 of the MSA8, documents that are not duly stamped, when presented
before an authority to receive evidence, may on opinion of the authority that received
evidence, be impounded.9

Section 34 of the MSA10 holds all unstamped and unduly stamped the documents
inadmissible as evidence for any purpose 11. E contracts may not hold evidenciary value
unless they are duly stamped.

However, the Collector of Stamps has the power to stamp impounded documents12. A penalty
for the non-payment of stamp duty or insufficient payment of stamp duty can be paid and the
impounded documents can gain their validity and can be admitted in evidence. 7 13

5
Bhagwandas Goverdhandas Kedia v. Girdharilal Parshottamdas 1966 AIR 543, 1966 SCR (1) 656
6
Section 2(l) [Explanation-under IT Act] of Maharashtra Stamp Act, 1958
7
Section 2(14)(b) of Finance Act, 2019
8
Section 33 of Maharashtra Stamp Act, 1958
9
M/S Sms Tea Estates P.Ltd vs M/S Chandmari Tea Co.P.Ltd. (2011) 14 SCC 6
10
Section 34 of Maharashtra Stamp Act, 1958
11
Omprakash vs. Laxminarayan & Ors. [2014(1) SCC 618]
12
Section 39 of Maharashtra Stamp Act, 1958
13
Garware Wall Ropes Ltd v. Coastal Marine Construction & Engineering Ltd 2019 SCC OnLine SC 515

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Non-payment of stamp duty with an intention to evade stamp duty is an offence and the
penalty for executing an instrument not duly stamped attracts a fine of upto rupees five
thousand and rigorous imprisonment of up to six months.14

The Petitioner may hence, pay the penalty of 196 crores, as calculated under Section 39 of
MSA by the Collector of Stamps, and admit their documents in evidence.

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 the respondent
contends that The Maharashtra Stamp Act, 1958 is not violative of Article 19 (1) (g) of the
Indian Constitution. A company and its members are two separate entities and not one as
argued by my fellow counsel. In the first Sholapur Spinning and Weaving Company Case15 ,
a shareholder challenged the Sholapur Spinning and weaving company (Provisions) Act,
1950 on the ground that the Act infringed his fundamental rights guaranteed by Article 19(1)
(f), Article 31 and Article 14 of the Indian constitution and was completely void. The court
while giving the decision reiterated the long established principle of separate legal entity and
said that individual shareholders and company are separate entities. Therefore, a shareholder
cannot claim infringement of fundamental rights on behalf of the company unless it infringes
his own rights too.

In another case the court dismissed the petition of Jupiter General Insurance Company Ltd
16
along with other insurance companies like the Empire of India Life Assurance Company
Ltd and the Tropical Insurance Company Ltd. and said a corporation is not a citizen and
14
Section 59 of Maharashtra Stamp Act, 1958
15
Chitranjit Lal Chowduri v. The Union Of India And Others 1951 AIR 41
16
Jupiter General Insurance Company v. Rajagopalan and Another case. AIR 1952 P H 9

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therefore it is not entitled to raise questions that the impugned legislation has taken away or
abridged the rights conferred by Article 19 (1) (f) and (g) of the Constitution of India. After
series of decisions given by different courts on different reasoning, the issue was discussed
by Supreme Court of India in the State Trading Corporation of India Ltd and others vs. The
Commercial Tax Officer, Visakhapatnam and others 17. While deciding the writ filed under
Article 32 of the constitution by State trading Corporation, the court had to decide whether
State Trading Corporation which is incorporated under Companies Act, 1956 is a citizen
within the meaning of Article 19 of the Constitution and can ask for the enforcement of
fundamental rights granted to the citizen under the said article. The Supreme Court explained
clearly that corporate bodies are juristic persons and so they cannot be termed as citizens
though they may be of Indian nationality due to incorporation in India. Thus, the court
distinguished that corporate body being Indian national is entitled to civil rights accruing
from international law but such corporate body is not a citizen. Hence, it is not entitled to any
particular right available only for citizen like that under Article 19.

After this case, the courts have denied corporate bodies the title of citizenship as well as
denying fundamental rights available to citizens even when claimed through shareholders or
directors of such companies. To support my argument I would like to give an example,
negating the judgement given in Reserve Bank case that companies should be entitled to
fundamental rights available to citizens as ultimately it is the citizens who form such
corporate bodies, the court in Tata Engineering and Locomotive Co. vs. State of Bihar and
Others18 held that: “Associations cannot lay claim to the fundamental rights guaranteed by
that Article solely on the basis of their being and aggregation of citizens. Once a company or
a corporation is formed, the business which is carried on by the said company or corporation
is the business of the company or corporation and is not the business of the citizens who got
the company or corporation formed or incorporated and the rights of the incorporated body
must be judged on that footing and cannot be judged on the assumption that they are the right
attributable to the business of individual citizens.”

In other subsequent cases like Jaipur Udhyog Ltd. vs. Union of India and Others19 where
writ petition had been filed under Article 226 of the Constitution of India challenging the
constitutionality of the Cement Control Order 1967 and V. Rev. Mother Provincial vs. State

17
State Trading Corporation of India Ltd & others v. The commercial tax officer, Visakhapatnam and others
1963 AIR 1811
18
Tata Engineering And Locomotive Co. v. State Of Bihar and Others 1965 AIR 40
19
Jaipur Udhyog Ltd. v. Union Of India and others AIR 1975 SC 1056

13
of Kerala and Others20 where some provisions of Kerala University Act, 1969 were
challenged to be violative of Article 19 (1)(f), Article 31 (2) and Article 30 (1) of the Indian
Constitution, courts decided in line of the Tata Engineering and Locomotive Case21 that a
company registered under the Companies Act 1956 not being a citizen is not entitled to claim
enforcement of fundamental rights under Article 19.

In the light of above mentioned reasons it is cleared that citizens and companies are two
separate entities and the Act is not violative of Article 19 (1) (g) of the Indian constitution.
And their request for justice should not be entertained as the Act did not violate any
person/citizens fundamental rights under the said Article.

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 NOT maintainable in the hon’ble Supreme Court
of India.
2. That Maharashtra Stamp Act is applicable to e-contracts and click-wrap agreements.
3. That the act of the State Government does NOT violate 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
Council for Respondent

20
V. Rev. Mother Provincial v. State of Kerala and others 1970 AIR 2079
21
Tata Engineering and Locomotive Case 1965 air 40, 1964 SCR (6) 885

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