DR.

RAM MANOHAR LOHIYA NATIONAL LAW UNIVERSITY, LUCKNOW

MOOT COURT COMMITTEE

UNIVERSITY MOOT COURT SELECTIONS

(SUMMER EDITION 2017)

MOOT PROPOSITION

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Factual Matrix:

1. In July 2013, two final year students Roy Pereira and Tehmul Dastur dropped out from
the most prestigious Engineering College of Clandestinesia, the Clandestine Institute of
Technology (CIT) because the Governing Council of CIT rebuffed their proposal for funding
the development of a revolutionary gadget neXt. Roy and Tehmul were jointly developing
neXt, a gadget which enabled the user to not only see a 3D video, but also experience the
smell, taste and touch as being shown in the video. In fact, not only did CIT refused to fund
them, CIT also forbade Roy and Tehmul from seeking any external aid or sponsors to finance
their project, thus, forcing them to drop out.

2. In September 2013, Roy and Tehmul set up Techdemons Clandestinesia Private

Limited (TCPL), a private limited company which was involved in designing websites for
corporations and also assisting with visual effects. Roy and Tehmul (collectively referred to as
Promoters) were also the Directors in TCPL. Apart from designing websites for corporations,
TCPL was also actively involved in designing websites and advertisements for NGOs as well as
various projects of Government of Clandestinesia pertaining to social causes such as education,
health, literacy, environment etc. TCPL undertook these projects on a pro bono basis. The
registered office of TCPL was in Fastville, the capital city of Clandestinesia and the corporate
headquarters of TCPL were in Pop City, capital of the State of Innovatia (a State in the Union of
Clandestinesia) and also popularly called the financial capital of Clandestinesia.

3. By May 2014, TCPL had made a rapid rise in the IT and media sectors and were
specially known for their exceptional visual effect work. Buoyed by the initial success, TCPL
had sought some funding and approached Mr. Zubin Dubash, the Director of Future World
Private Limited (FWPL) in this regard informally. FWPL was a leading multinational
conglomerate and its area of operation spanned over several industries ranging from
telecommunication to real estate and mining. However, FWPL was specially renowned in the

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area of scientific innovation and had launched several products across industries which had
proved as game changers in many countries across the globe. It was also known to promote
promising young companies by investing in such companies. However, FWPL was under severe
attack in recent times as it was embroiled in a conflict with one of the native tribes of
Clandestinesia known as the Khosads.

4. The Khosads were a fiercely closed knit tribe of several hundred individuals which had
continued to live for centuries in seclusion on an isolated island of Clandestinesia, the Khosad
Island. Their culture and practices were rather unknown. One of the practices of the Khosads
included an annual ritual called Khosadasti wherein, all the Khosad boys of marriageable age
undertook private stay with their prospective suitresses of marriageable age and whosoever was
found physically compatible on the basis of sexual intimacy was chosen as the bride.

5. It was well known that the Khosad Island was also a huge reserve of a rare earth material
known as Ignomy. Around June 2014, FWPL was granted mining rights in the Khosad Islands
by the Ministry of Mines (Union of Clandestinesia). One of the conditions contained in the
license obliged FWPL to seek prior approval of the Ministry of Mines in case it sought to acquire
control of any other company. However as soon as FWPL began its mining operations, it faced
tremendous opposition from the Khosads who claimed that such a step will destroy their natural
habitat and is an unwanted intrusion into their secluded yet peaceful life and practices. Since this
issue was widely covered by the Media and several Human Rights organisations, the public
opinion in Clandestinesia was hugely in favour of the Khosads and the government was under
pressure to cancel the mining license of FWPL.

6. As the controversy was brewing, sometime in July 2014 one of the media agencies came
out with a brief report (Khosadasti Report) on the culture of the Khosads which also shed
some light on the practice of Khosadasti. The report claimed that one of the lesser known but
indispensible facet of Khosadasti was that only such suitresses were permitted to participate in
this annual ritual who were undergoing the last days of their monthly menstrual cycle. A lot of
curiosity arose in the general public after such reports surfaced.

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7. Around the same time, TCPL was approached by one Dr. Jnanendra Mitra, the Chairman
of a Pop City based film society Bioscope for assisting with the visual effects of a
documentary-film In the Land of Khosads. TCPL agreed. Bioscope was a society registered
under the Clandestinesia Societies Registration Act, 1860 and had the reputation of making
cinema which dealt with various social, political and cultural issues. Moreover, of late the media
reports on the Khosads had generated a considerable interest in their lifestyle and customs.
Various social and political thinkers had denounced the practice as being immoral and against
the dignity of women. Interestingly, in a web-interview, both Roy and Tehmul expressed shock
at the practice and further claimed that the same is inconsistent with the ideologies and practices
of modern world. These media reports led to a complete swing in the public opinion against the
Khosads.

8. In August 2014, formal talks started between FWPL and TCPL regarding the proposed
investment in TCPL. FWPL felt that TCPL had tremendous prospects but was reluctant to
commit funds fearing that its license to mine Ignomy in the Khosad Island may get cancelled
which could lead to huge financial losses to FWPL. After considerable persuasion from the
Promoters who sought to allay the fears of financial losses, FWPL agreed to invest in TCPL in
two tranches. FWPL had the right to invest the second tranche in case TCPL achieved certain
financial milestones. The negotiations proceeded at a fast pace and FWPL invested in TCPL to
get 24.99% shares in the company. A shareholders agreement (SHA) was prepared by FWPL
and executed with TCPL to record the rights and obligations of the parties. The SHA provided
that TCPL shall not enter into any related party contracts without prior approval of FWPL. In
addition, Clause 42 of the SHA contained the following term:

This SHA reflects complete understanding of the Parties with respect to the transactions
contemplated herein and the Parties agree to cooperate in good faith with each other in
the functioning of the Company (TCPL) and shall seek to abide by the terms of this
SHA in letter and spirit.

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9. In a press release pertaining to the investment, FWPL stated that no approval was sought
from Ministry of Mines for making the investment because FWPL does not seek to control the
day-to-day affairs of TCPL and hence has not acquired any control over TCPL. It was reported
in various print and electronic media that the Ministry of Mines was looking into the matter to
see if FWPL has violated the conditions of license in this regard.

10. As the negotiations between FWPL and TCPL were proceeding, the budget of In the
Land of Khosads went overboard to the extent that the film was on the verge of being shelved.
Because this film was one of the first of its kind, Bioscope approached TCPL to also offer the
necessary financial assistance by producing the film. While TCPL agreed to produce the film, it
insisted that (a) the film be made in as vivid a manner as possible so as to show the true nature of
and intent behind the practices of the Khosads and consequently, viewers are correctly informed,
and (b) The Promoters shall be the narrators of the documentary so as to create maximum
impact. For this purpose, the Promoters entered into an agreement (Narration Agreement) with
TCPL (acting in the capacity of producers of the film) pursuant to which they were to narrate the
documentary.

11. Subsequently, in the first board meeting after the execution of the SHA, a resolution was
moved to increase the salary of the Promoters in their capacity of Directors as a recognition of
their exemplary work. The resolution which was moved noted their efforts and contribution and
praised them for taking responsibilities beyond their call of duty on behalf of TCPL so as to take
the company to new heights. The Board of TCPL comprised of 7 Directors which included 1
Executive Director nominated by FWPL and the Promoters. The remaining Directors were
Independent Directors. The Promoters, being interested Directors, refrained from voting.
However, the other Directors voted unanimously to increase their salary.

12. In March 2015, In the Land of Khosads was released and it opened to immense critical
acclaim. This film intricately showed the culture of the Khosads, including the vividly filmed
annual ritual of Khosadasti. The film also relied on the Khosadasti Report for the purpose of
presenting the practice of Khosadasti. A significant part of the film comprised of a visual treat
to the viewers as the Khosad Islands were very picturesque Islands with immense natural beauty.

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In addition to this, a considerable portion of the film was devoted to interviews of members of
the Khosad tribe, historians, social anthropologists, Government officials etc.. Apart from all of
this, the mining operations being carried out in the Khosad Islands were also shown in the film.

13. On 1st April, 2015, the Promoters launched neXt and it became an instant success with
its sales skyrocketing and people making bookings in advance.

Judicial Proceedings:

I. Obscenity Proceedings

14. Sometime in August 2015, i.e. about three months after the launch of neXt, Samaj
Kalyan Kendra a Non Governmental Organisation filed a Criminal Complaint in the Court of
Chief Judicial Magistrate, Pop City arraigning Bioscope (through Dr. Jnanendra Mitra) and
TCPL (through the Promoters) as well as the Promoters (in their individual capacity) as
Accused(s) and alleging inter alia as under:

(i) Bioscope and TCPL had committed the offence of Obscenity by explicitly
showing the sexual practices of Khosads in the film In the Land of Khosads and
therefore, Dr. Jnanendra Mitra and the Promoters are vicariously liable for the offence of
obscenity committed by TCPL.

(ii) From the beginning itself, TCPL had intentionally undertaken the offer of
assisting with the visual effects of In the Land of Khosads, so that after the release of a
successful film which explicitly showed the sexual practices of the Khosads, neXt could
be launched as it was a gadget which not only showed videos in 3D but also enabled the
user to smell, touch and taste. In this way, TCPL and the Promoters had intentionally
targeted a consumer base and provided them with a gadget which could be used for
viewing pornographic material on the internet and undertake a virtual world experience
(inclusive of touch, taste and smell) as never before.
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15. On 17th August, 2015, the Ld. Chief Judicial Magistrate, Pop City issued summons to
TCPL, the Promoters and Bioscope. Subsequently, on 21st January, 2016 charges were framed
for commission of offences punishable under Section 292 of Clandestinesia Penal Code read
with Section 67A and 85 of the Candestinesia Information Technology Act, 2000. Since both
TCPL and Bioscope were well known entities, the news of issuance of summons against them
was widely covered.

II. Suit for Damages

16. Meanwhile, some prominent media agencies carried out stories suggesting that FWPL
has orchestrated this entire controversy in collusion with TCPL so as to swing the public opinion
against the Khosads to help them protect their mining license. Amid all the speculations, in
November 2015, FWPL filed a Suit for Damages to the tune of 5 Million Clandestenian Rupiyah
(CR 5 Million) against TCPL claiming breach of contract in the High Court Innovatia. It
argued that execution of the Narration Agreement was a related party contract and required prior
approval of FWPL. The plaint was admitted. In their written statement, TCPL averred that that
there was no breach of the SHA as there was no consideration paid to the Promoters under the
Narration Agreement and it was merely an agreement which was not contemplated as an
affirmative vote matter under the SHA. On 24th April, 2016 the Honble High Court decreed in
favor of FWPL on the following grounds:

(a) The contract having been drafted by TCPL, it was obligatory on them to lay down
the critical obligations in specific detail and in the absence of that, the intent of the parties
to the SHA suggests that FWPL wanted to have a visibility on the related party
transaction to ensure that TCPL was in compliance with applicable laws and that there
was no wasteful siphoning off of shareholders money.

(b) It further observed that increase in salary of the Promoters and the execution of
the contract for narration should be seen as a whole and on such viewing the arrangement

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amounted to a contract which should not have been executed without the prior approval
of FWPL.

17. Against order of the Ld. Single Judge, TCPL preferred an appeal to the Division Bench
which, on 30th May 2016 reversed the order of the Ld. Single Judge and held that the execution
of the Narration Agreement and increase in salary cannot be legally seen as one transaction and
thus the Narration Agreement was not a contract. It further held that the totality of facts and
circumstance suggest against the intent on the part of FWPL to regulate the kind of transactions
in question and hence it could not be said to have a veto on the Narration Agreement. Against
this order of division bench, FWPL filed a Special Leave Petition1 in the Supreme Court under
Article 136 of the Constitution of Clandestinesia on which notice was issued. However, no stay
was granted.

18. In the meanwhile, Bioscope, the Promoters and TCPL had preferred separate Writ
Petitions before the High Court of Innovatia under Article 226 of the Constitution of
Clandestinesia seeking quashing of the order of Ld. Chief Judicial Magistrate, Pop City dated
17th August, 2015 framing charges. In these writ petitions, it was specifically pleaded that the
making of the documentary film In the Land of Khosads and leading the narration voice in the
same was well within their freedom of speech and expression as guaranteed under Article
19(1)(a) of the Constitution of Clandestinesia and the right to make and produce films as
guaranteed under Article 19(1)(g) of the Constitution of Clandestinesia. In addition to this,
Bioscope, TCPL and the Promoters also assailed the vires of Section 292 of Clandestinesia Penal
Code and Section 67 and 67A of the Clandestinesia Information Technology Act, 2000 on the
grounds that the said provisions were vague and gave an unwarranted scope for subjective
interpretation. After several hearings, on 28th August 2016, the writ petitions were dismissed by
the High Court of Innovatia. By this time, the matter had been extensively covered by the media
and had invoked immense public curiosity.

1
SLP (Civil) No. 2527 of 2016 titled as Future World Pvt. Ltd. v. Techdemons Clandestinesia Pvt. Ltd.

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19. Against this order of High Court of Innovatia dated 28th August 2016, Bioscope,
Promoters and TCPL preferred separate Special Leave Petitions2 before the Honble Supreme
Court of Clandstinesia under Article 136 of the Constitution of Clandestinesia. On 27th
September 2016, the Special Leave Petitions were admitted and proceedings in the court of Ld.
Chief Judicial Magistrate, Pop City were stayed.

20. While the matter was sub-judice before the Honble Supreme Court of Clandestinesia, in
October 2016 Khumantu Khosad, the Chief of the Khosads filed a Criminal Complaint before the
Ld. Chief Judicial Magistrate, Khosad Islands alleging that Bioscope, FWPL and TCPL have
entered into a conspiracy to defame the Khosads through their film In the Land of Khosads so
as to protect the mining license of FWPL. In the criminal complaint, it was averred that (a)
consent of the Khosad tribe was not taken prior to shooting and thus the publicity rights of the
people of Khosads and its people were violated, (b) for Khosads, the practice of Khosdasti was a
practice to celebrate the process of creation of life as the Khosads believed that the children born
out of such union were descendants of God and protectors of the tribe from enemies and rival but
the presentation of the practice in the film is highly derogatory and a complete misrepresentation
as it has been shown as nothing more than an exercise of sexual perversity. However, the manner
in which the film was made and the consequent media reports have clearly shown that the right
minded people of the society are viewing the Khosads as immoral and regressive. In view of this,
the film In the Land of Khosads has defamed the Khosads and violated their publicity rights.
Accordingly, Bioscope, TCPL, and FWPL were liable to be prosecuted and convicted u/s 499,
500 r/w s. 120B of the Clandestinesia Penal Code and Dr. Jnanendra Mitra, the Promoters and
Zubin Dubash were vicariously liable for the offence committed by Bioscope, TCPL and FWPL
respectively. On this criminal complaint also, summons were issued.

2
SLP (Crl.) No. 432 of 2016 titled as Bioscope ,A Registered Society v. State of Innovatia & Anr., SLP (Crl.) No.
451 of 2016 titled as Roy Periera & Anr. v. State of Innovatia & Anr. , SLP (Crl.) No. 460 of 2016 titled as
Techdemons Clandestinesia Pvt. Ltd. v. State of Innovatia & Anr.

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21. In November 2016, the Government of Clandestinesia issued a notification restraining the
Khosads from carrying out the annual ritual of Khosadasti publicly. However, the Khosads were
permitted to carry out the ritual of Khosadasti privately. This notification of the Government of
Clandestinesia was challenged by Khumantu Khosad under Article 32 of the Constitution of
Clandestinesia inter alia on the ground that the same was a clear foray into the Khosads
constitutional right to practice Khosadasti which was protected under Article 29 of the
Constitution of Clandestinesia. Notice was issued on this Writ Petition3 and it was tagged with
the already pending SLPs of Bioscope, the Promoters and TCPL.

22. In January, 2017 Bioscope, TCPL and FWPL along with Dr. Jnanendra Mitra, the
Promoters and Zubin Dubash preferred separate Special Leave Petitions4 under Article 136 of
the Constitution against the order of Ld. Chief Judicial Magistrate, Khosad Islands issuing
summons. Notice was issued on these SLPs but no stay was granted. In addition, the Honble
Supreme Cout of Clandestinesia was also pleased to tag all the SLPs and the Writ Petition to be
taken up together for being heard on merits.

23. On 29th March 2017, all the above mentioned SLPs and Writ Petition came for hearing
before the Honble Supreme Court of Clandestinesia, however, concerned with the nature of
legal questions involved, the matter was referred to a Constitutional Bench of 5 judges for
adjudication. The following issues were framed for determination by the Constitution Bench:

(a) Whether Section 292 of the Clandestinesia Penal Code and Section 66 and 67A of
the Clandestinesia Information Technology Act, 2000 are vague and arbitrary and ultra
vires the Constitution?

3
Writ Petition (Civil) No. 974 of 2016 titled as Khumantu Khosad v. Union of Clandestinesia & Ors.

4
SLP (Crl) No. 71 of 2017 titled as Bioscope, A Registered Society v. State (The Khosad Island Administration),
SLP (Crl.) No. 77 of 2017 titled as Dr. Jnanendra Mitra v. State (The Khosad Islands Administration), SLP (Crl.)
No. 83 of 2017 Techdemons Clandestinesia Pvt. Ltd. v. State (The Khosad Island Administration, SLP (Crl.) No. 91
of 2017 titled as Roy Pereira & Anr. v. State (The Khosad Island Administration ), SLP (Crl.) No. 104 of 2017
titled as Future World Pvt. Ltd. v. State (The Khosad Island Administration) and SLP (Crl.) No. 132 of 2017 titled as
Zubin Dubash v. State (The Khosad Island Administration)

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(b) Whether the Khosad tribe has a fundamental right guaranteed under Article 29 of
the Constitution of Clandestinesia qua organization and conduct of the annual ritual of
Khosadasti?

(c) Whether Khosads can claim to have a reputation as a community inasmuch as

any consequent injury to such reputation can amount to the criminal offence of
defamation and the same being punishable u/s 499 and 500 of the Clandestinesia Penal
Code?

(d) Whether Khosads as a community can claim publicity rights?

(e) Whether the Promoters, Dr. Jnanendra Mitra and Zubin Dubash are vicariously
liable for the acts of TCPL, Bioscope and FWPL respectively for the offences punishable
u/s 292 and 499 of CaPC and u/s 66, 67A of the Clandestinesia Information Technology
Act, 2000?

(f) Whether TCPL has breached the SHA by executing the Narration Agreement and
liable to pay damages for the same?

NOTA BENE

* Laws applicable in the Republic of Clandestinesia are in pari materia with the laws applicable
in the Republic of India.

** This Moot Proposition has been drafted by Mr. Ravi Shankar Jha (former Senior Associate,
BMR Legal, and Master in Public Policy Scholar at National University of Singapore) and Mr.
Kushagra Pandey (Advocate, Supreme Court of India). Any attempt to contact the drafters may
result in immediate disqualification

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