Recover your money

Be it your employer sitting on your rightful dues, your client refusing to pay you the rightful amount or a builder refraining from returning the amount he has charged you in excess, you might come across any of the unfortunate aforementioned situations. How does one deal with such a case?

Lending money to a friend or a family might horribly go wrong if they refuse to return such amount. We, the common people, unlike the banks which have a well established recovery mechanism in DRT’s, do not have any particular recovery machinery to boast of. However, there are multiple provisions and recourses available to battle out such cases and get back your money.

SENDING OUT A WELL DRAFTED LEGAL NOTICE

Before you initiate any legal action, you are supposed to serve a notice to the opposition, representing all the grievances to them and indicating your intent to initiate further legal actions.

It is a final chance given to the opposition for a resolution of the problems. There is always a chance that the legal notice might bring the defendant on heels and the case might get settled even before going into trial, through discussions and negotiations. It is very important to draft an elaborate and strongly worded legal notice, which covers everything from facts to your demand from the opponent.

In case, the opponents refuse to refund the money/ settle the matter after the receipt of the legal notice, following are the legal recourses that can be taken:

CIVIL REMEDIES

  1. File a summary suit under Order 37 of the Civil Procedure Code, in order to recover your money. Compared to normal suits, summary suits are disposed of faster. Once the suit is instituted and the summons are issued, the defendant has 10 days to make an appearance, failing which the court assumes the plaintiff ‘s allegations to be true and, accordingly, awards the plaintiff. If the defendant makes an appearance and asks for leave to defend, the court accepts his defence only if it is convinced that it is substantial to the case in question.

Where the matter concerns penalties or any other uncertain amount or any amount that is not a debt, one cannot file a summary suit.

  1. If there is a debt occurring out of a cheque bounce, then one can file a complaint under Section 138 of the Negotiable Instruments Act, 1881. As per this provision, a legal notice is to be sent to the defaulter within 30 days of receiving the cheque return memo. If the cheque issuer fails to make the rightful payment within 30 days of receiving the notice, the payee has the right to file a criminal complaint under this Section. However, the complaint should be registered in a magistrate’s court within a month of the expiry of the notice period, otherwise your suit will be time-barred. If found guilty, the defaulter can be punished with a prison term of two years and/or a fine, which can be as high as twice the cheque amount.

CRIMINAL PROCEEDINGS

One also has the option to file a criminal complaint against the defaulter, with the local police under section 420 (cheating), section 403 (criminal misappropriation) and section 406 (criminal breach of trust), and initiate criminal proceedings against the defaulter by registering the FIR.

OUT-OF-COURT SETTLEMENTS

If the other party is willing to settle the matter, then one of the fastest and most economical ways of recovering money is to opt for an out-of-court settlement, such as arbitration or conciliation. If the matter is referred to an arbitrator, the latter hears both the parties and passes an award binding on both.

If the matter is referred to a conciliator, then he assists the parties in reaching a mutually agreed settlement of the dispute.

How to file and defend a dowry legal case in India

Dowry is a major social menace in India. Every year, countless women are victims to dowry harassment. Some are subjected to torture, while others are found dead in suspicious circumstances.

The Indian legal system, has the following laws in place, which can be used while filing an FIR against the accused-

1- In 1983 section 498-A of the Indian Penal Code (IPC) was introduced to deal with all forms of domestic violence including those which arose from “demand for property from the women and her family”. This in other words dealt with demand for dowry and also included different acts of torture that the in laws indulged in with the wife. These included beating and abusing her, sexual violence, use of cuss words, false imprisonment etc. This can lead to imprisonment for upto a maximum of 3 years.

2- When a woman commits suicide because of dowry related harassment within 7 years of being married section 304-B of the IPC which was amended in the year 1986, should be used to prosecute. The period of seven years has ostensibly been kept to ensure that the limitation period for filing suspected dowry related complaints are high.

3- Section 406 of the IPC is meant to protect “stridhan” – wealth given to bride on the eve of her marriage by the family to ensure her well being in the future. If such wealth is misappropriated by the bridegroom and his family, a non-bailable and cognizable offence is committed which can result in imprisonment for three years with fine.

4- Protection of Women from Domestic Violence Act (2005) too deals with dowry related violence and provides remedy for the same. Though this is largely a civil suit that orders protective decrees for protecting women, if such decrees are not followed the court can initiate criminal proceedings against the erring party.

5- The Dowry Prohibition Act (1960) is a landmark legislation that exclusively deals with tackling dowry exclusively. Section 2 of this act defines dowry as “give and take of any valuable property”. Section 3 and section 4 of the act deals with the punishment for giving, taking and demanding dowry. The imprisonment ranges from 6 months to 5 years and fine ranges between 10,000 rupees to the amount of dowry demanded.

In case police officials refuse to file an FIR, the State Commission for Women(SCW)  can be reached , you can find the telephone and other related details of the respective SCWs over here-

http://webcache.googleusercontent.com/search?q=cache:http://ncw.nic.in/frmliststatecommission.aspx&gws_rd=cr&ei=LHWlWavTB8XNvgSylqDoBQ

Similarly, when a man or his family, or both have been accused of dowry harassment, they can file a counter FIR under the following legal provisions-

  1. Sec 120B Indian Penal Code, 1860 – Punishment of Criminal Conspiracy – The husband or the in laws can file a legal case alleging criminal conspiracy from the wife or her relatives. 
  2. Sec 167 Indian Penal Code, 1860 – Public servant framing an incorrect document with intent to cause injury – If you believe that the police authorities are helping your wife in making false complaint and framing incorrect documents you can file a case against them alleging their false framing of documents.
  3. Sec 182 Indian Penal Code, 1860 – False information, with intent to cause public servant to use his lawful power to the injury of another person – What usually happens is that the public servant in his power does something which might not be the true, in short, a false information is circulated so as to depress the evidence.
  4. Section 191 Indian Penal Code, 1860 – Giving false evidence – If you suspect that your wife or anybody is presenting false evidence against you in the court of law or police station, you can file a case alleging that the evidence which are being used to prosecute you are false, which consequently make the whole charges false.
  5. Section 197 Indian Penal Code, 1860 – Issuing or signing a false certificate – Perjury is a crime, one can’t sign a false certificate and allege it to be true. Hence, if someone suffers because of the wrong certificate, he can prove himself innocent after showing sufficient evidence.
  6. Section 471 in The Indian Penal Code – Using as genuine a forged [document or electronic record]. –Whoever fraudulently or dishonestly uses as genuine any [document or electronic record] which he knows or has reason to believe to be a forged [document or electronic record], shall be punished in the same manner as if he had forged such [document or electronic record].
  7. Section 497 in The Indian Penal Code – Adultery – Whoever has sexual intercourse with a person who is and whom he knows or has reason to believe to be the wife of another man, without the consent or connivance of that man, such sexual intercourse not amounting to the offence of rape, is guilty of the offence of adultery, and shall be punished with imprisonment of either description for a term which may extend to five years, or with fine, or with both. In such case, the wife shall not be punishable as an abettor.
  8. Section 500 Indian Penal Code, 1860 – defamation – Reputation is man’s biggest asset. So if someone tries to defame you by any means, you can drag them to court for the harm suffered by you because of their conduct. They will be entitled to pay you damages to you in terms of compensation.
  9. Section 504 The Indian Penal Code, 1860 – Intentional insult with intent to provoke breach of the peace – Whoever intentionally insults, and thereby gives provoca­tion to any person, intending or knowing it to be likely that such provocation will cause him to break the public peace, or to commit any other offence, shall be punished with imprisonment of either description for a term which may extend to two years, or with fine, or with both.
  10. Section 506 Indian Penal Code, 1860 – Punishment for Criminal Intimidation – You can file a case of criminal intimidation against your wife alleging that she threatens you to do harm to you or your family or your property. Yet again, evidence is the only thing which can support your case.
  11. Section 227 of The Code of Criminal Procedure, 1973 – If you believe that the complaint registered by your wife is false you can file an application under sec 227 stating that the 498A case filled by your wife is false. If you have enough proofs, or if she does not have enough proof to substantiate the charges, chances are that the judge just dismisses the 498A case as it is a framed one.
  12. Section 9 of Code of Civil Procedure, 1908 – Damage recovery case – If she breaks into your home, creates a scene, and goes to ” protection officer ” and lies that you abused her “physically, emotionally or economically”, file a damage recovery case under Section 9 of CPC against her. Legally, you must issue notice on the same day or next day. The suit will continue for a long time. It has no risk.

    By Saurabh Kumar 

Biological father taking away of child does not amount to Kidnapping

The biological father cannot be charged for kidnapping his own child.

In the instant matter, the court was hearing a petition filed by Mumbai’s businessman, Sajid Shah for challenging his extradition request from the Netherlands to India. His estranged wife Nazneen has filed a complaint against him for abducting their 2-year-old daughter from Amsterdam. After kidnapping the daughter he brought her back to India in September 2016. She has accused Sajid Shah of “violently kidnapping their daughter” from her house and also launched an online campaign for the child’s return. Subsequently,  an Interpol notice was issued for Sajid’s arrest. Following the Interpol notice, the Netherlands government approached the Indian authorities.

Nazneen and Sajid married in 2011 and got separated in 2016.  After the couple separated, a Dutch court awarded Nazneen their daughter’s custody in 2016. Meanwhile, Sajid filed a divorce and custody petition before Bandra family court. Sajid claimed he was trying to protect his daughter from his “abusive wife”.

The MEA, in it’s May 5, 2017, letter, rejected the extradition request. The center in its affidavit submitted “Since the taking away of a child by her biological father does not amount to kidnapping, it is not an extraditable offence.”  MEA has rejected the extradition request while stating that Sajid shall not be arrested and no corrective steps will be taken against him and his daughter.

Sexual Harassment at workplace

Sexual harassment involves offensive, humiliative, or intimidating behavior which can be in a written, oral, physical, or even in digital form. In this 21st century, where both men and women work together in an organization, it has been found that women have to face some kinds of unusual behavior inside the workplace from their colleagues. This would be considered a violation of women’s right to equality, life, and liberty. Women have to face an insecure and hostile environment that discourages women’s participation and work, and it demotivates them. This has become a common problem in the world irrespective of any profession.

India, being a democratic country, all citizens have the inherent right to live with dignity provided under Article 21 of the Indian Constitution. With the increasing amount of industrialization, many employers started employing women. However, the absence of a law on sexual harassment at workplaces and the increasing cases of such cases lead the legislature to formulate legislation based on sexual harassment resulting in the birth of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act 2013. In Vishaka v. State of Rajasthan[(1997) 6 SCC 241], it was observed for the first time that India needs legislation for sexual harassment.    

Sexual harassment may include:

  • Asking for sex or sexual favors.
  • Questioning about your sex life.
  • Trying to touch or grab without consent.
  • Making comments which have sexual meaning.
  • Leering and staring at or suggestive body movements towards 
  • Showing pornography.
  • Sexually colored remarks. 
  • Making inappropriate sexual gestures. 

The Supreme Court incorporated basic principles of human rights enshrined in the Constitution of India under Article 14, 15, 19(1)(g) and 21, and provisions of the Convention on Elimination of All Forms of Discrimination against Women (CEDAW), in the guidelines to prevent and discourage sexual harassment at workplaces. The guidelines which had been laid down by the Supreme Court were to be treated as law declared under Article 141 for the Constitution. 

What shall one do if one is sexually harassed?

  • A woman who is a victim of sexual harassment can file a written complaint to ICC ( Internal Complaints Committee) within three months from the date of the incident. Up to three months of delay of filing the complaint is acceptable by the committee and if there is any physical or mental incapability in the aggrieved, then legal heirs or any such other person as provided in Rule 6 of The Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Rules, 2013 (“the Rules”) may make a complaint. 
  • When a complaint is received, the committee, before initiating an inquiry, may try to settle the matter between her and the respondent through conciliation, and when a settlement has arrived, no further inquiry is conducted. If the conciliation fails or any term of the settlement arrived at has not been complied with by the respondent, the committee shall proceed further with the inquiry.
  • After completion of the inquiry within 10 days, the report of its finding shall be provided to the employer/District officer and the concerned parties. In case of any false filling or false evidence, the committee may recommend taking action as per the provision of the rule as prescribed in Rule 10.
  • Within 90 days of the recommendation before the court or tribunal, an appeal can be filed against the recommendations of the committee. 

It is also the duty of the Employer and the District Officer under Section 19 and 20 of the Act to do acts such as creating awareness on sexual harassment in the workplace, sensitizing the employees, assisting the complaint committee in conducting an inquiry, timely submission of reports to the committee, etc.
Non-compliance to these may result in a fine which may extend to fifty thousand rupees and can also lead to cancellation of license, renewable or withdrawal or cancellation of the registration as the case may be. It is also to be noted that during a job interview employers should not be asking about status, age, disabilities, race, caste, country of origin, sexual preference. Such behavior would also fall under Sexual harassment.

Conclusion:

In India, sexual harassment at the workplace is highly prevalent and there is a need for gender sensitization and letting an employee know the basic rules of workplace behavior. It is unlawful to harass a person because of a person’s sex. Both the party  can be either a woman or a man,, and the victim and harasser can be of the same sex. It has become a global problem in both developed and undeveloped countries in the world and should be looked upon seriously by both,employer and employees.

By Bhanita Das

Sedition Law in India: Growing calls to strike down ‘colonial’ law

Sedition law has been one of the most controversial aspects of the legal system in India since time immemorial. The law which deals with punishments for rebellion against the established order has been prevalent from the time of the British colonial rule and has been an infamous tool in suppressing the voice of the people. Freedom fighters like Mahatma Gandhi and Lokmanya Tilak have been victims of the law which was exploited by the British.

Lord Macauley who framed the Indian Penal Code included provisions for punishment for sedition under Section 113 and after amendments post-independence, sedition is governed by Section 124A of the Code. The section states that if a person by speaking, writing, signs or visible representations brings hatred or contempt towards the government, he will be punished with imprisonment up to three years and/or fine.

The arguments in favour of sedition law

Sedition law is considered important by its advocates for the reason that it helps keep anti-national elements in check. Terrorists and secessionists who incite violence through words can be curbed through the law. Anarchy, overthrowing of the government, violent protests and the like are also sowed usually by words and hence, sedition law can help prevent the same. Also, sedition law is considered akin to contempt of court as the latter deals with disrespecting one organ of the government – judiciary while the former deals with the other organs – executive and legislature. 

The arguments against sedition law

First and foremost, sedition law was introduced during British colonial rule and was used as a tool to punish Indians who dared to speak out. The law has a dark history associated with it and hence, in today’s world it seems misguided for it to continue to exist. Sedition law is also considered to be one of the biggest obstacles to the freedom of speech and expression. Further, the law is easy to exploit due to its not-so-specific wording leading to even constructive criticism sometimes being considered to be sedition. Also, there are various other provisions under the IPC and Unlawful Activities Prevention Act, 2019 which deal with and can govern terrorist and secessionist activities instead of sedition.

Recent occurrences and the growing calls for striking down sedition law

Recent occurrences involving sedition law have only led to more voices in favour of repealing it. Especially since 2014 when the BJP government came into power, there has been a rampant increase in the number of cases being filed under the controversial law. According to a study by Article 14, 96% of the sedition cases filed since 2010 have been after 2014. The arrest of activists and journalists hasn’t helped matters either. Further, the rate of conviction upon these arrests has been alarmingly low. Due to this huge spike in arrests and the low conviction rate, there have been a plethora of calls from various sections for the law to be completely repealed. 

While the law has not been struck down or deemed unconstitutional so far, the Supreme Court has time and again taken a stance that is critical of sedition law. Very recently, on the 15th of July, 2021, the apex court while examining a plea questioning the constitutional validity of the sedition law called the law ‘colonial’. The petitioner had contended that Section 124A of the IPC contained vague terms such as ‘disaffection towards Government’ and that it was an unreasonable restriction on the freedom of expression under Article 19(1)(a). Chief Justice of India, NV Ramana upon hearing the plea stated that sedition was the law that suppressed the voices of freedom fighters like Mahatma Gandhi before asking the Centre whether it was necessary to still be in force. The plea is currently being examined by a three-judge bench. 

Future of sedition law

The Supreme Court’s recent views look promising from the point of view of the sedition law being repealed in the future. However, whether or not the provision will finally see its end remains to be seen. The provision does continue to divide opinion and the debate will be unceasing. Freedom of speech has perpetually been a touchy subject and hence, what the future holds is anyone’s guess.

By Nevin Clinton

Terrorism Laws in India: Does the controversial UAPA need to be amended?

The Unlawful Activities (Prevention Act), 1967 (hereinafter referred to as UAPA) is a law that aims at curbing unlawful activities that threaten the sovereignty of India. The Act has proved to be extremely controversial due to the fact that there is plenty of scope for misuse. Further, the rate of conviction has been observed to be extremely low. All of these have led to the Act being deemed ‘draconian’ and asked to be reformed. 

UAPA, TADA and POTA – History of terrorism in Indian statutes

The UAPA was enacted in 1967 in order to ‘promote and ensure national integration’. It allowed the government to impose certain reasonable restrictions on some fundamental rights like freedom of speech and expression, right to assemble peacefully and without arms, and right to form associations or unions, in order to preserve the sovereignty and integrity of India. The Act then underwent amendments in 1969, 1972 and 1986 but there weren’t provisions that directly dealt with terrorism or curbing terrorism in it. 

It is noteworthy that there was a controversial Act on terrorism in force between 1985 and 1995 called the Terrorist and Disruptive Activities (Prevention) Act (TADA). This Act was then repealed by the Prevention of Terrorist Activities Act (POTA) in 2002. Now, POTA proved to be extremely contentious as well, since there were vague provisions on who a terrorist was, which led to several political arrests being made. POTA was repealed very soon in 2004 and provisions of terrorism were then added to the UAPA through the Unlawful Activities (Prevention) Amendment Act, 2004. 

Definition of ‘terrorist act’

Sections 15 to 40 of the UAPA deal with terrorism, terrorist acts and terorrist organizations. Section 15 is the most important and also the most disputed as it defines what a ‘terrorist act’ is. While subsection a) deals with usage of explosives and the like, and subsection c) deals with detaining or kidnapping people, subsection b) remains the delicate one as it deals with ‘overawing by means of criminal force or the show of criminal force’. This subsection has led to several doubts on what a terrorist act actually is and has also left plenty of scope for exploitation and misuse. The rest of the provisions deal largely with punishments while Chapter VI of the Act discusses terrorist organizations. 

Misuse of UAPA: Need for amendments

As mentioned above, the UAPA’s vague definition of ‘terrorist acts’ leaves a lot to be desired. Therefore, there have been instances of people being arrested on charges of terrorism, being jailed for a considerable amount of time, and being released after not being convicted. These people are not entitled to bail as well, since the Act prohibits the same under Section 43D. Such cases clearly point to misuse and exploitation. 

But the major problem and the need for amendments lie in the deeming of an individual as a terrorist before the trial while also denying bail. For denotification of the same, an application can be made and once that is done, the Central Government will set up a Review Committee. But the problem lies in the fact that if the arrest was a biased one motivated by political agenda or the like, the review process is also bound to be the same. The particularly long time window for the investigation process (90 days) and filing of chargesheet (180 days) is also an issue. The fact that the judiciary has not intervened and remained indifferent with regard to the UAPA is another major concern.

With the arrest under the UAPA and subsequent death of Jesuit priest and tribal rights activist, Stan Swamy, plenty of voices have been raised against the Act. Former judges of the Supreme Court have joined in and stated that the UAPA must not continue to exist in its current form. 

There is clearly a lot of work to do to make anti-terrorism laws perfect in India. Removing the vagueness in definitions, time window for filing chargesheets, better bail provisions, and so on can go a long way in being a positive change. As of now, that seems unlikely, but the growing voices and calls for the same could lead to a favourable development. 

By Nevin Clinton

Law for the Protection of Juveniles from Sexual Offence

Movies whether good or bad always leave an impression on the viewer. The scene from the film “Highway” which portrayed the actress’s outburst about being sexually abused as a child by her uncle kept haunting me for days. I tried imagining the trauma and the misery of an innocent child subjected to Sexual Offence. Sexual abuse of any kind on any person is a monstrous act in itself; more so if a child is subjected to it; who often cannot even comprehend what is happening to him or her.

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Prevention of Sexual Harassment at Workplace – An Indian Inc’s responsibility

The recent sexual harassment case of Tarun Tejpal (editor of investigative journalism magazine, Tehelka) has brought to the fore the inept redressal of sexual harassment complaints within the Indian companies. The Supreme Court of India in 1997, for the first time, acknowledged sexual harassment at the workplace as a human rights violation in Vishaka and others v. State of Rajasthan[i] (the Vishaka judgment). This judgment made it mandatory for employers at all workplaces to observe the guidelines laid down therein.

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The DNA Technology Regulation Bill And Its Impact On Privacy

In July of this year, the Lok Sabha introduced the DNA Technology Regulation Bill. Following that, it was forwarded to the Parliamentary Standing Committee on Science and Technology.

Major Provisions

  1. The bill would create guidelines for the use and application of DNA technology to determine the identification of:
  • Missing people
  • Crime victims 
  • Offenders or criminals 
  • In court/accused
  • unidentified deceased people.
  1. The DNA Technology (Use and Application) Regulation Bill, 2019 aims to expand the use of DNA-based forensic technology to help India’s justice delivery system.
  2. The bill would also ensure the technology’s reliability by requiring all DNA laboratories to be accredited and regulated.
  3. In terms of our residents’ privacy rights, it would also ensure that data is secured from exploitation or abuse.
  4. By allowing the use of DNA evidence, which is regarded as the gold standard in criminal investigations, the proposed legislation will strengthen the criminal justice system.
  5. The creation of National and Regional DNA Data Banks, as proposed in the Bill, will aid forensic investigations.
  6. The law will also assist in the formulation of a uniform code of practice for all DNA testing labs in India.
  7. With proper input from the DNA Regulatory Board, which will be established for the purpose, this will aid in the scientific up gradation and streamlining of the country’s DNA testing activities.
  8. The application of scientifically based technologies would strengthen the current legal system.

The Shortfalls In The Bill

  1. Mis-Use of Sensitive Information:
  • DNA profiles can provide highly sensitive information about a person’s ancestry (pedigree), skin colour, behaviour, illness, health condition, and disease risk.
  • Access to such sensitive data might be used to target individuals and their families with their own genetic information.
  • It could even be used to falsely associate a certain caste or community with criminal activity.
  1. Unconvicted Persons’ DNA Profiles Are Stored:
  • For future investigations, the bill recommends storing DNA profiles of suspects, undertrials, victims, and their families.
  • According to the bill, DNA profiles for civil proceedings will likewise be maintained in the data banks, but without a clear and independent index.
  • The committee has questioned the need for such DNA profiles to be stored, claiming that doing so violates the fundamental right to privacy and serves no public purpose.
  1. Formal Consent:
  • Consent is mentioned in various provisions of the Bill, but in each of them, a magistrate can easily overturn consent, effectively making consent a formality.
  • The Bill also provides no advice on the grounds and reasons for the magistrate’s ability to overturn consent.
  1. Removal Of The Accused’s DNA Profile:
  • The bill allows DNA found at a crime scene to be kept indefinitely, even if the offender’s conviction has been reversed.
  • The committee has suggested that the proposals to destroy biological samples and erase DNA profiles from the database be subjected to independent review.
  1. Data Protection Isn’t Strong Enough:
  • The committee also deemed the bill “premature,” raising concerns about the security of the massive number of DNA profiles that will be stored at the National DNA Data Bank and its regional centres.

Although DNA can be a significant tool in investigating crimes, it requires adequate crime scene assessment, trained and dependable policing, a trusted chain of custody of samples, reliable analysis, and the use of expert evidence in court to use DNA effectively during criminal investigations. As a result, both laboratory quality assurance and crime scene investigation must be overseen. It is also vital to keep the civilian and criminal DNA databases distinct.

Individuals would have some redress if their privacy or data protection rights were not respected if a bill was passed prior to their rights being violated. This is especially essential considering the Supreme Court’s Right to Privacy decision.

The government should also conduct a cost-benefit analysis, as building massive databases is not always the most cost-effective way to solve more crimes, and limited resources must be focused properly.

By Pragati Sengar

Law Clauses in Power Purchase Agreements

Power Purchase Agreements

Electricity being an essential welfare commodity for economic development, from houses to hospitals, schools, businesses all operate with due assistance of electricity in some way or the other. However, with time there is shortage of supply and increase of demand for electricity. Government through its intervention and collaboration with private investors/ independent power generators to ensure to meet this capital need. 

Power Purchasing Agreements are thus agreements between two parties where one party who produces or generates the electricity from renewable sources and the other party is ready to purchase the electricity. A power purchase agreement may include payment terms, termination, when electricity is to be delivered, penalties for undersupply (if any) and other matters related to commercial operation. 

  1. Definitional Clause – Just like our statues we have specified terms and their definition given at the very inception, the definition clause is also used in an agreement at the beginning of the PPA. The definition clause is usually the first clause here as well which defines certain technical terms pertaining great importance in the agreement.  An examples of definitional clauses are:

Definition:

“Agreement” means this document, including its supplements and all documents, guidelines or standards incorporated by reference, as such may be amended from time to time.”

  1. Term of Agreement – is another important factor to be included in the PPA. PPA contains all the essential, commercial terms, agreement date, early termination etc, which are to be presented in a commercial operation. The time period of the contract usually ranges from 20 to 25 years. This period is long because the installation cost of power plants, power grids and transmission lines incurs huge costs and that.

Term of Agreement 

This Agreement shall be valid for a term commencing from the Effective Date until the Expiry Date (“Term of Agreement”), unless terminated earlier pursuant to Article ____. Upon the occurrence of the Expiry Date, this Agreement shall, subject to Article ___, automatically terminate, unless mutually, extended by all the Parties on mutually agreed terms and conditions, at least ninety (90) days prior to the Expiry Date, subject to the approval of the Electricity Regulatory Commission”

  1. Conditions subsequent to be satisfied by the seller and the buyer. – These are conditions that both seller and consumer have to mutually agreed upon. The conditions are basically requirements that both the parties should fulfill, mostly within the twelve months from the agreement. The conditions and obligations are mostly related to permit approval and sending notice to the contractor. If these are not fulfilled then the other party should be obliged to pay compensation.

Example:

Satisfaction of conditions subsequent by the Seller

The Seller agrees and undertakes to duly perform and complete the following activities at the Seller’s own cost and risk within ____ months from the Effective Date:

[List of activities] 

Satisfaction of conditions subsequent by the Procurer

The Procurer agrees and undertakes to duly perform and complete the following activities at the Procurer’s own cost and risk within ____ months from the Effective Date:

[List of activities]”

  1. Supply of power – This clause pertains a very important question in the entire agreement which deals with the supply of power. This clause also defines whether the parties are going to enter on-site or off site- PPA or under this clause the producer supplies to the consumer, the agreed energy capacity. The delivery of the same is going to be in accordance with PPA or a virtual PPA.
  1. Charges for Available Capacity – The Company’s fixed cost and variable cost will be stated under this clause. The fee will be based on availability (availability fee) and power delivery fee. 
  1. Metering – For such huge power production huge meters are necessary for maintaining the records as well as regulating the production. This clause handles all the matter related to meter installing, reading and measuring. The price of installing, regulating as well as all substantial expenses to be bear for the purpose of the meter. 
  1. Insurance- This clause takes into account that both the parties should have adequate insurance for the term of the agreement. Evidence for the same is also required. On any kind of loss to the plant or any part of the plant, this insurance can help against that loss. The amount of insurance would be dependent upon the value of the plant. 
  1. Force Majeure – This clause is important to prevent the termination of the project due to any unexpected situation such as war, terrorism or epidemics. The clause of force majeure means the non-completion of a task because of any unexpected event or circumstance. These clause recognizes such circumstances, the list includes incidents that are beyond the control of the parties and thus prevents the termination of the agreement because of them. 
  2. Liability and Indemnity Clause – An indemnity clause in any kind of contract refers to the transfer of risk or cost which is to be paid by one party but if the clause is included then other party becomes liable for the same. In the indemnity clause the limitation of liability, procedure for claiming mine or monetary limitation of liability is defined in detail. 
  1. Change in Law – Climate change, environment degradation are prime topics in the politics today. Legislations are made regarding the same and are constantly changed because it’s a new and overgrowing domain. Electricity provided by renewable energy sources will also be regulated by laws that are constantly changing. However, the PPA is a long term contract and is susceptible to various changes, including the changes in the actual legal regulation or framework on which the PPA stands. Since these contracts are usually long-term they might come across the incidents where the law can change after the bidding of PPA. And a change in law can also have material effects on the PPA, in terms of cost, income and expenses. To overcome this problem we have the change in law clause. If one party is being affected by the change in the law, it has to inform the other party as soon as possible, within a reasonable time limits. Added with notification of a change in law, the party should also give an account of change in laws in order to avoid future dispute.  

In conclusion, signing a PPA is the best way to averse all types of risks legal involved, showing your commitment towards sustainability, and gets you ahead of the competition overall. 

By Zoya Hossain