List of Current Affairs

Source: Supreme Court 

Why in News?  

Recently, the bench of Justices Pankaj Mithal and Prasanna B. Varale has held that the Court will examine whether Merchant Navy officers' foreign-earned income credited to Indian bank accounts is exempt from income tax under the Income Tax Act, 1961. 

• The Supreme Court held this in the matter of Vandana & Ors. v. Keshav & Ors. (2025). 

What was the Background of the Vandana & Ors. v. Keshav & Ors. (2025) Case? 

• The case arose from a motor accident compensation claim where the deceased was employed as a Merchant Navy Officer with British Marine PLC, London, earning USD 3,200 monthly.  
• The Motor Accident Claims Tribunal (MACT) initially awarded Rs. 36,04,000 as final compensation to the appellant, who was the wife of the deceased. However, the tribunal made a 30% deduction from the compensation amount, treating it as tax liability on the income earned by the deceased. 
• The appellant challenged this deduction, arguing that the income earned by her husband while working with a foreign entity should be exempt from Indian income tax. 
• The Punjab & Haryana High Court upheld the MACT's decision regarding the tax deduction but enhanced the overall compensation to Rs. 1.01 crores by adding 40% prospects. 
• The fundamental issue centred around whether a person employed in the merchant navy as an officer, whose salary is credited to accounts maintained in India, should be exempt from payment of income tax under Indian law.  
• The appellant contended that if such income is exempt from tax, then no deduction should have been applied while calculating the compensation amount. 

What were the Court's Observations? 

• The Supreme Court observed that this case presents a significant legal question regarding the taxation of foreign-earned income by Indian residents employed in merchant navy services.  
• The Court noted that one of the primary legal issues is whether a person employed in merchant navy as an officer and drawing salary in accounts maintained in India is exempt from payment of income tax under the Income Tax Act, 1961. 
• The Court observed that if such persons are indeed exempted from payment of tax, then the Tribunal ought not to have applied any deduction on account of income tax while computing the compensation.  
• The bench recognized that this issue has broader implications for similarly situated individuals and therefore expedited the hearing of the matter. 
• The Supreme Court granted leave in both the main petition and cross petition, deciding to take them up together for comprehensive adjudication.  
• The Court framed the central question as whether Merchant Navy officers' foreign-earned income is taxable in India, and if not, whether the Tribunal and High Court committed an error in deducting 30% income tax while calculating the motor accident compensation. 
• The Court's decision to expedite the hearing indicates the importance and urgency of resolving this taxation issue, which affects not only the present case, but potentially numerous other individuals employed in merchant navy services with foreign entities. 

How Foreign-Earned Income Tax Exempted? 

• India follows the residence rule under the Income Tax Act, 1961, which means Indian residents must pay tax on their global income regardless of where they earn it. Foreign source income is defined as income earned from sources outside India, provided the ultimate beneficiary conducts the activity outside India. 
• The location where income is first received is crucial, as income must be initially received outside India to potentially qualify for exemption. If foreign-earned income is received directly in India, it becomes taxable under domestic tax laws regardless of where it was originally earned.  
• The taxability of foreign income primarily depends on an individual's residential status under Section 6 of the Income Tax Act, 1961, which categorizes people as Resident and Ordinarily Resident (ROR), Resident but Not Ordinarily Resident (RNOR), or Non-Resident (NR).  
• Ordinary residents in India must pay tax on their global income, meaning all income is taxable in India even if it has already been taxed in the foreign country where it was earned.  
• For non-ordinary residents and non-residents, income becomes taxable in India only if it is accrued, arisen, or received in India. However, relief from double taxation is available through Foreign Tax Credit provisions under Sections 90 and 91 of the Act, and Double Tax Avoidance Agreements (DTAA) exist to prevent taxpayers from paying tax on the same income in multiple countries. 
• The mere fact that foreign-earned income is credited to an Indian bank account does not automatically exempt it from Indian income tax liability 
• Foreign-earned income credited to Indian bank accounts is generally not exempt from income tax under the Income Tax Act, 1961, particularly for Indian residents, as exemption depends primarily on residential status and the initial point of receipt rather than the banking location. 

Source: Supreme Court  

Why in News? 

Recently, the bench of Justice MM Sundresh and Justice Rajesh Bindal has held that the Trade Marks Act, 1999 does not lay down rigid criteria to assess whether a mark is likely to deceive or cause confusion. Instead, each case must be decided on its own facts. 

• The Supreme Court held this in the matter of Pernod Ricard India Private Limited & Another v. Karanveer Singh Chhabra (2025). 

What was the Background of Pernod Ricard India Private Limited & Another v. Karanveer Singh Chhabra, (2025)? 

• Pernod Ricard India Private Limited, a major alcoholic beverage manufacturer, owns registered trademarks for popular whisky brands including "Blenders Pride" (registered 1994, in use since 1995), "Imperial Blue" (launched 1997), and "Seagram's" (registered 1945), with combined annual turnovers exceeding ₹4,400 crores.  
• In May 2019, Pernod Ricard discovered that a respondent company was marketing whisky in Madhya Pradesh under the brand name "London Pride" using packaging and design elements allegedly similar to their established brands. 
• The appellants filed a trademark infringement suit in the Commercial Court, Indore, claiming that "London Pride" was deceptively similar to "Blenders Pride" due to the shared word "Pride" and that the respondent's packaging imitated the colour scheme and trade dress of "Imperial Blue."  
• Additionally, they alleged that the respondent was using "Seagram's" embossed bottles to sell their "London Pride" whisky, constituting direct trademark infringement.  
• The Commercial Court rejected their interim injunction application on 26 November 2020, finding no deceptive similarity between the marks. 
• The Madhya Pradesh High Court upheld this decision on 3 November 2023, dismissing the appellants' appeal and concluding that the competing products were clearly distinguishable to consumers.  
• This led Pernod Ricard to approach the Supreme Court, challenging both lower court orders and seeking interim relief to prevent alleged trademark infringement, passing off, and unfair competition.  
• The case centres on fundamental questions of when trademark similarity creates consumer confusion and the appropriate standards for granting interim injunctions in intellectual property disputes involving composite marks and trade dress elements. 

What were the Court’s Observations? 

• The Supreme Court observed that deceptive similarity in trademark law does not require exact imitation, emphasizing that the material consideration is the likelihood of confusion or association in consumers' minds arising from overall resemblance between competing marks, and courts must assess marks in their entirety rather than dissecting composite trademarks into isolated components.  
• The Court found that the marks 'Blenders Pride' and 'London Pride' are clearly not identical, noting that while the products are similar, the branding, packaging, and trade dress are materially distinct, with the term 'Pride' being publici juris and commonly used in the liquor industry.  
• The Court determined that the products in question are premium and ultra-premium whiskies targeted at a discerning consumer base who exercise greater care in purchase decisions, making the likelihood of confusion negligible given the distinct trade dress and packaging.  
• The Court criticised the appellants' legal strategy as a "hybrid and untenable pleading," observing that their attempt to combine elements from two distinct marks - 'Blenders Pride' and 'Imperial Blue' - to challenge 'London Pride' was legally unsustainable, as each mark must be assessed independently. 
• The Court noted that Section 17(1) of the Trade Marks Act, 1999 grants exclusive rights only in respect of registered marks, while Section 17(2) excludes protection for common or non-distinctive elements unless they have acquired secondary meaning, and the appellants failed to demonstrate such distinctiveness.  
• The Court observed that the appellants' earlier unsuccessful challenge to United Spirits' use of 'Pride' in "Royal Challenger American Pride" established that they possessed no independent registration for the word 'Pride' but only for the composite mark 'Blenders Pride,' making their present attempt contrary to law and settled principles of equity. 
• The Court emphasised that in the liquor industry, where advertising is highly restricted, brand recognition rests predominantly on packaging and consumer loyalty, and unless imitation is deliberate and intended to mislead, the chance of confusion is minimal.  
• The Court concluded that the appellants failed to establish a prima facie case of deceptive similarity that could justify granting interim injunction, finding no meaningful similarity between the marks apart from the shared use of a common term. 

What are the Criteria Applied for Grant of Interim Injunction? 

• Serious Question to be Tried / Triable Issue: The plaintiff must demonstrate a genuine and substantial question fit for trial, establishing that the claim is more than frivolous, vexatious, or speculative, though it is not necessary to establish a likelihood of success at the interlocutory stage. 
• Likelihood of Confusion / Deception: Courts may assess the prima facie strength of the case and the probability of consumer confusion or deception at the interlocutory stage, and where the likelihood of confusion is weak or speculative, interim relief may be declined at the threshold despite not requiring a detailed analysis of merits. 
• Balance of Convenience: The court must weigh the inconvenience or harm that may result to either party from granting or refusing the injunction, with the balance favouring the plaintiff if refusal would likely result in irreparable harm to goodwill or mislead consumers in the marketplace. 
• Irreparable Harm: Where the defendant's use of the impugned mark may lead to dilution of the plaintiff's brand identity, loss of consumer goodwill, or public deception - harms which are inherently difficult to quantify - the remedy of damages may be inadequate and irreparable harm is presumed to exist. 
• Public Interest: In matters involving public health, safety, or widely consumed goods, courts may consider whether the public interest warrants injunctive relief to prevent confusion or deception in the marketplace, ensuring consumer protection remains paramount. 
• Cumulative Application: The grant of interim injunction in trademark matters requires courts to consider these multiple interrelated factors cumulatively, where prima facie case, likelihood of confusion, relative merits of parties' claims, balance of convenience, risk of irreparable harm, and public interest operate together. 
• Threshold for Refusal: The absence of any one of these essential criteria may be sufficient grounds to decline interim relief, as these considerations work in conjunction rather than independently to determine the appropriateness of granting injunctive relief. 
• Equitable Principles: The grant of injunction remains governed by equitable principles and is subject to the general framework applicable to proprietary rights, where courts retain discretion to mould relief according to the specific circumstances of each case. 

Source: Supreme Court 

Why in News? 

The bench of Justices Surya Kant and N Kotiswar Singh in the case of Ajmera Shyam v. Smt. Kova Laxmi & Ors. (2025) refused to interfere with the election of BRS MLA Kova Laxmi from Asifabad constituency, holding that mere failure to disclose assets does not constitute corrupt practice if not of substantial character. 

• It will not make the acceptance of the nomination improper, thus invalidating the election. 

What was the Background of Ajmera Shyam v. Smt. Kova Laxmi & Ors. (2025) Case? 

• The case arose from the Telangana Legislative Assembly Elections, 2023, where Kova Laxmi of Bharat Rashtra Samiti (BRS) was elected from Asifabad constituency. 
• Kova Laxmi had disclosed her assets, liabilities, PAN, and sources of income (honorarium as Zilla Parishad Chairperson) in her election affidavit. 
• She submitted IT returns for 2022-23 but recorded "Nil" income for previous years from 2018 to 2022. 
• Appellant Ajmera Shyam challenged her election, alleging that the omission to reveal complete income details as per Form 26 affidavit amounted to improper acceptance of nomination and corrupt practice under Section 100 of the RPA. 
• The Telangana High Court had earlier refused to interfere with Kova Laxmi's election, which decision was appealed before the Supreme Court. 
• Rule 4A of the Conduct of Election Rules, 1961 requires candidates to file Form 26 affidavits disclosing assets, liabilities, and IT returns of the past five years. 
• The petitioner contended that non-disclosure of complete income details violated these requirements and constituted grounds for setting aside the election. 

What were the Court's Observations? 

• The Supreme Court distinguished between substantial defects and minor technical non-compliances, stating "disclosure requirement as far as assets and educational qualification is concerned, should not be unreasonably stretched to invalidate an otherwise validly declared election over minor technical non-compliances that are not of substantial character." 
• The Court held that "the defect of non-disclosure mentioned is not of a substantial nature, for the same reason the Respondent No.1 cannot be considered to have indulged in a corrupt practice within the meaning of Section 123 (2) of the Act." 
• Justice NK Singh observed that while Rule 4A requires disclosure of IT returns, non-disclosure would not be a substantial defect to declare the election void on grounds of corrupt practices. 
• The Court emphasized that "merely because a returned candidate has not disclosed certain information related to assets, courts should not rush to invalidate the election by adopting a highly pedantic and fastidious approach." 
• The judgment established that the true test is "whether the non-disclosure of information about assets in any case is of consequential or inconsequential import." 
• Referring to Lok Prahari v. Union of India & Ors. (2018), the Court noted that while non-disclosure of assets can amount to corrupt practice, in this case it was "not of a substantial nature."

What are Asset Disclosure Requirements in Elections? 

About:  

• Asset disclosure requirements were introduced to enhance transparency in the electoral process and enable informed voting by the electorate. 
• Form 26 under the Conduct of Election Rules, 1961 mandates disclosure of assets, liabilities, educational qualifications, and criminal antecedents. 
• Candidates must file affidavits disclosing their movable and immovable assets, sources of income, and income tax returns for the preceding five years. 
• The objective is to prevent persons with disproportionate assets or undisclosed wealth from entering the electoral arena. 

Legal Framework:  

• Under Section 123 of the Representation of People's Act, 1951, corrupt practices include undue influence, bribery, and making false statements in nomination papers. 
• Section 100(1)(b) of the RPA provides that elections can be declared void if corrupt practices are committed by the returned candidate. 
• The Supreme Court in various judgments has held that material suppression or false declaration in affidavits can constitute corrupt practice. 
• However, the Court has consistently maintained that not every technical non-compliance amounts to substantial defect warranting nullification of elections. 

What is the Representation of the People Act, 1951? 

About: 

• The Representation of the People Act 1951 is India's foundational electoral law that governs the country's democratic processes. Enacted in 1951, it establishes comprehensive rules for conducting fair and transparent elections. 

Key Highlights: 

Major Sections: 

• Section 8: Disqualifies candidates based on criminal convictions, with specific provisions for different types of offences and imprisonment terms. 
• Section 29A: Enables political party registration with the Election Commission. 
• Section 123: Defines corrupt practices including bribery and undue influence. 
• Section 126: Prohibits displaying election material on TV 48 hours before polling (excludes print and digital media). 
• Section 126A: Bans exit polls during specified periods. 
• Section 100: Sets conditions for voiding elections due to malpractice. 

Core Features: 

The Act covers four main areas: 

• Election Procedures: Rules for conducting elections and resolving disputes. 
• Qualifications and Disqualifications: Eligibility criteria emphasizing ethical conduct. 
• Electoral Offences: Defines prohibited practices like bribery and booth capturing. 
• Election Commission Powers: Outlines regulatory authority and responsibilities. 

Electoral Offences Under RPA: 

The Act prohibits various corrupt practices including: 

• Offering gratification to voters or candidates 
• Interfering with voting rights 
• Appeals based on religion, caste, race, or community 
• Promoting hatred between different groups 
• Publishing false statements about candidates 
• Booth capturing 
• Misusing government resources for electoral advantage