MEMORIAL ON THE BEHALF OF RESPONDENT

Participant Code- C97

DR. RAM MANOHAR LOHIYA NATIONAL LAW UNIVERSITY, LUCKNOW

CONCOURS, 2017

Before,

THE HON’BLE SUPREME COURT OF INDIA

WRIT PETITION UNDER ARTICLE 32 OF THECONSTITUTION OF INDIA

PREDICIR A GANAR .....................................................................................PETITIONER

v.

UNION OF INDIA.................................................................................RESPONDENT

CLUBBED WITH

WRIT PETITION UNDER ARTICLE 32 OF THE CONSTITUTION OF INDIA

CR DEN............................................................................................................PETITONER

v.

UNION OF INDIA….....................................................................................RESPONDENT

ON SUBMISSION TO THE SUPREME COURT OF INDIA

WRITTEN SUBMISSION ON BEHALF OF THE RESPONDENT

GOVERNMENT OF INDIA
MEMORIAL ON THE BEHALF OF RESPONDENT

TABLE OF CONTENTS

INDEX OF AUTHORITIES ........................................................................................................ 3

LIST OF ABBREVIATIONS ...................................................................................................... 4

STATEMENT OF JURISDICTION ........................................................................................... 5

STATEMENT OF FACTS ........................................................................................................... 6

ISSUES RAISED........................................................................................................................... 8

SUMMARY OF THE ARGUMENTS ........................................................................................ 9

ARGUMENTS ADVANCED ..................................................................................................... 10

I. THAT THE NOTIFICATION DATED 04.10.2016 ISSUED BY PREDICTIONS

REGULATORY AGENCY IS NOT VIOLATIVE OF THE RIGHT TO FREEDOM OF
TRADE AND PROFESSION GUARANTEED UNDER THE CONSTITUTION OF INDIA.
................................................................................................................................................... 10

[1.1] THE NOTIFICATION ISSUED BY PREDICTIONS REGULATORY AGENCY TO

CEASE ALL THE BUSINESS IS REASONABLE. ........................................................... 10

[1.2] THE RESTRICTIONS IMPOSED BY THE PRA IS IN THE INTERESTS OF THE

GENERAL PUBLIC. ............................................................................................................ 11

[1.3] THE RESTRICTION IMPOSED BY THE PRA IS TO CURB UNFAIR TRADE

PRACTICE. .......................................................................................................................... 12

II. THAT THE RIGHT TO PROPERTY OF PREDICIR A GANAR HAS NOT BEEN
VIOLATED OWING TO THE FRUSTRATION OF CONTRACT BETWEEN PAG AND
GOVERNMENT OF INDIA. ..................................................................................................... 13

[2.1] THE CONTRACT BETWEEN PAG AND GOVERNMENT OF INDIA HAS NOT
BEEN FRUSTRATED DUE TO THE ESTABLISHMENT OF THE PRA. ...................... 13

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MEMORIAL ON THE BEHALF OF RESPONDENT

[2.2] THE FUNDAMENTAL RIGHT TO PROPERTY OF PAG HAS NOT BEEN

VIOLATED AS GOVERNMENT HAS NOT DEPRIVED HIM FROM HIS RIGHT TO
PROPERTY. ......................................................................................................................... 14

PRAYER .................................................................................................................................. 16

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MEMORIAL ON THE BEHALF OF RESPONDENT

INDEX OF AUTHORITIES

Cases

Amalgamated Investment & Property co Ltd v John Walker & Sons Ltd [1977] 1 WLR 164 ..... 14
Badri Narayan v. Kamdeo Prasad 2010 SCC OnLine Mad 4476. .............................................. 13
Fertilizer Corporation Kamgar Union Sindri v Union of India AIR 1981 SC 344. .................... 12
Ganga Singh v Santosh Kumar AIR 196 AII 201......................................................................... 13
Khardan co Ltd v Raymond co (India) Pvt Ltd [1963] 3 SCR 183. ............................................. 14
Krishnan Kakkanath v Govt of India AIR 1997 SC 128 .............................................................. 11
M/S Ramchand Jagdish Chand v Union of India AIR 1963 SC 563. .......................................... 10
Unichoyi v State of Kerala AIR 1962 SCR (1) 946. ..................................................................... 11
Union of India v International Trading Co [2003] 8 SCC 437. ................................................... 11

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MEMORIAL ON THE BEHALF OF RESPONDENT

LIST OF ABBREVIATIONS

1. AIR- All India Reporter

2. SC- Supreme Court Cases

3. SCC- Supreme Court Cases

4. SCR- Supreme Court reporter

5. Ltd. - Limited

6. Co. – Corporation

7. PaG – Predicir a Ganar

8. CR Den- ChhotaRajan Den

9. PRA- Predictions Regulatory Authority

10. ASP- Analyzed Sporting Predictions

11.GOI- Government of India

12. HMCL- HaiderMastan Cricket League

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MEMORIAL ON THE BEHALF OF RESPONDENT

STATEMENT OF JURISDICTION

The Respondent humbly submits this memorandum in response to the petition filed before the
Honourable Supreme Court under Article 32.

The present memorandum sets forth the facts, contentions and arguments in the present
case.

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MEMORIAL ON THE BEHALF OF RESPONDENT

STATEMENT OF FACTS

¶ 1. With the endeavor of promotion of a strong market foundation, the Government of India
enacted the Onshore Investments (Ease of Doing Business in India) Act, 2014’ (“the Act”) with
the intent of luring foreign investors through an eased out regulatory mechanism; attainable by
means of certain contractual arrangements between the prospective investor(s) and the
Government of India. Anticipating the blossoming avenues ahead, one Dawood Ibrahim Kaskar
approached the Government of India to establish a Nagpur-based corporation named Predicir a
Ganar (“PaG”) in collaboration with the latter, using which any interested party could register
and win money by analyzing sporting events. The PaG portal would use computerized
algorithms for matching such analysis which ensured its freedom from the vice of rigging. The
contractual settlement of PaG with the Government of India was such that the whole chunk of
investment was to be made by the Government whereas the business input was to be supplied
solely by PaG.

¶ 2. The command of the new venture was handed over to one named ChhotaRajan, veteran in
the industry and dearest to the founder Dawood. As CEO of PaG, Rajan now solicited masses to
register on PaG, offering immunity from loss while placing the first analysis through a welcome
cashback equivalent to the quantum of loss suffered. Resultantly, the portal was flooded with a
plethora of registrations as the people started to invest heavily in sporting events. Symbolic to the
popularity of PaG, the Government of India, equally concerned with safeguarding the interests of
investors, enacted the Analyzed Sporting Predictions (Regulation and Promotion)Act, 2015
under which the Predictions Regulatory Agency (“PRA”) was established. PRA was responsible
for regulating the industry and all ancillary contours. The scheme of affairs twisted ends when
ChhotaRajan parted ways with Dawood Ibrahim after the former resigned from PaG to come up
with a similar rival portal of his own named CR Den which followed the same business mode.

¶ 3. Whilst the growing participation, the third edition of the much awaited HaiderMastan
Cricket League (“HMCL”) was organized. In the ensuing analysis (and unlike the earlier trend)

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MEMORIAL ON THE BEHALF OF RESPONDENT

investors were left penniless at the end of the event due to a series of upsets. Duped of their hard-
earned money, the investors grew increasingly suspicious that the league was organized unfairly.
Registering a case against the management of HMCL under section 420 of the Indian Penal
Code, 1860, EoW arrested the management of HMCL and it was revealed during investigations
that players had often been approached and contacted by the managers of HMCL at rather odd
hours and venue. Releasing a Press Report dated 3rd October 2016, ShriVedanshjiTripathi,
Commissioner, Mumbai Police, noted: ‘The Investigation is in its final leg and we have strong
evidence suggesting an involvement of CR Den in man-managing the players in HMCL. There
are compliance issues on part of CR Den as well. Charge sheet is bound to be filed before the
Magistrate’s Court on 12th of this October. There was immense outrage against ChhotaRajan in
the public as those who played on CR Den had recorded a loss of 29 Billion INR in the third
edition of HMCL. Considering the grave public sentiment involved, the PRA probed a separate
inquiry into the affairs of CR Den by setting up the TanyajiVatsa Commission (“the
Commission”) which reported that the company failed to furnish the algorithmic data using
which the analysis was supposed to be mapped. By its circular dated 04.10.2016. The PRA
ceased all business operations in the domain of sports analysis which rewarded successful
predictions. Aggrieved by the same, CR Den, joined later by PaG, approached the Supreme
Court of India under Article 32 of the Indian Constitution petitioning a violation of its Right to
Freedom of Trade and Profession.

¶ 4. Meanwhile, PaG defaulted in making the contractual payments to the Government of India
owing to its funds getting scantier with each passing day. Government of India initiated
arbitration proceedings against PaG for breach of contract, however the proceedings were stalled
many a times by PaG through its continual refusal of suggesting an Arbitrator. The Centre
appointed one Smt. SuchitajiVyas as the sole arbitrator, but this appointment was challengedby
PaG by way of a Writ before the Bombay High Court owing to her long-standing animosity with
Dawood Ibrahim. SuchitajiVyas passed an award in favour of the Government of India
bestowing upon it the properties belonging to PaG on account of its contractual breaches and
established insolvency. Another writ was filed by PaG before the Supreme Court of India under
Article 32 alleging a violation of its Right to Property on the ground that the very contractual
claim of Government of India stood frustrated with the establishment of the PRA.

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MEMORIAL ON THE BEHALF OF RESPONDENT

ISSUES RAISED

I. WHETHER THE NOTIFICATION DATED 04.10.2016 ISSUED BY THE PREDICTIONS

REGULATORY AGENCY IS VIOLATIVE OF THE RIGHT TO FREEDOM OF TRADE
AND PROFESSION GUARANTEED UNDER THE INDIAN CONSTITUTION.

II. WHETHER THE RIGHT TO PROPERTY OF PREDICIR A GANAR HAS BEEN

VIOLATED OWING TO THE FRUSTRATION OF THE CONTRACT BETWEEN PAG AND
GOVERNMENT OF INDIA.

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MEMORIAL ON THE BEHALF OF RESPONDENT

SUMMARY OF THE ARGUMENTS

I. THAT THE NOTIFICATION DATED 04.10.2016 ISSUED BY THE PREDICTIONS

REGULATORY AGENCY IS NOT VIOLATIVE OF THE RIGHT TO FREEDOM OF
TRADE AND PROFESSION GUARANTEED UNDER THE INDIAN CONSTITUTION.

Freedom of trade and profession is a fundamental right guaranteed under Art 19(1)(g) of the
constitution of India. The notification issued by the PRA is not violative of the right to freedom
of trade and profession as it put reasonable restrictions in the interest of the general public. Due
to the man-management of the players in HMCL there was immense outrage in the public that’s
why business operations has suspended by the PRA in the public interest. The fundamental right
of a citizen to carry on any occupation, trade or business under Art 19(1)(g) of the constitution of
India is not absolute: it is subject to reasonable restrictions which may be imposed by the state in
the interest of the general public.

II. THAT THE RIGHT TO PROPERTY OF PREDICIR A GANAR HAS NOT BEEN
VIOLATED OWING TO THE FRUSTRATION OF THE CONTRACT BETWEEN PAG
AND GOVERNMENT OF INDIA.

Section 56 of the Contract Act 1857 tells about the frustration of the contract. The right to
property of thePaG has not been violated as PaG is not deprived of its property. The contract
between Government and PaG has not frustrated as no such event occurs that has made the
performance of the contract impossible . The property of the PaG has been bestowed upon the
government by the arbitrator when PaG defaulted in its payment through the arbitration
proceedings that was mentioned in the agreement signed between government and the PaG. So
the right to property of the PaGhas not been violated.

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MEMORIAL ON THE BEHALF OF RESPONDENT

ARGUMENTS ADVANCED

I. THAT THE NOTIFICATION DATED 04.10.2016 ISSUED BY PREDICTIONS

REGULATORY AGENCY IS NOT VIOLATIVE OF THE RIGHT TO FREEDOM OF
TRADE AND PROFESSION GUARANTEED UNDER THE CONSTITUTION OF
INDIA.
It is humbly submitted before the Hon’ble Supreme Court of India that the notification issued by
PRA is not violative of freedom of trade and profession under art 19(1)(g) of the constitution of
India as it only put reasonable restriction on the fundamental right to trade and profession in the
interests of general public at large.

[1.1] THE NOTIFICATION ISSUED BY PREDICTIONS REGULATORY AGENCY IS

REASONABLE.
It is humbly submitted before the Hon’ble Supreme Court of India that the notification issued by
the PRA is not violative of the fundamental right to freedom of trade and profession because the
notification does not put unreasonable restriction. Art. 19(1)(g) guarantees to all citizens the right
to practice any profession or to carry on any occupation ,trade or business. Under Art.19(6),
however the state is not prevented from making a law imposing in the interests of general public,
reasonable restriction on the exercise of above right.

In the case of M/S. RamchandJagdishChand vs. Union of India1court said that the fundamental
right of a citizen to carry on any trade and occupation under Art.19(1)(g) of the constitution of
India is not absolute: it is subject to a reasonable restriction which may be imposed by state in
the interest of the general public.

In the present case the restrictions imposed by the PRA is reasonable as it is imposed after the
report given by the “the commission” which reported that the company failed to furnish the
algorithmic data using which the analysis was supposed to mapped.

1
M/S RamchandJagdish Chand v Union of IndiaAIR 1963 SC 563.

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MEMORIAL ON THE BEHALF OF RESPONDENT

[1.2]THE RESTRICTIONS IMPOSED BY THE PRA IS IN THE INTERESTS OF THE

GENERAL PUBLIC.
It is humbly submitted before the Hon’ble Supreme Court of India that the restrictions imposed
by the PRA is in the interests of general public. The freedom guaranteed under Art. 19(1)(g) is
not absolute and restrictions can be imposed in the interest of general public.

In the case of Unichoyi v. State of Kerala 2 it was held that the restrictions though they interfere
to some extent with the freedom of trade and profession guaranteed under Art.19(1)(g) are
reasonable and being imposed in the interests of the general public are protected in terms of
clause (6) of the Art.19. In the present case although the circular ceased all the business in the
domain of sports analysis but it is to safeguard the interests of the investors and the people who
are involved in those business.

In another case Krishnan Kakkanath v. Govt. of India 3it was held that the government order
issued in public interest overrides individual interest and the question of public interests must be
considered not from the point of interests of the person on whom the restriction is imposed even
if the restriction operates on him harshly and in the present case the order of the PRA to cease all
business is harsh but is in the interest of the people and to safeguard the interests of investors.

Further in the case of Union of India v. International Trading Co.4the court said that
reasonableness of restriction is to be determined in an objective manner and from the stand point
of the interest of general public and not from the standpoint of the interests of persons upon
whom restrictions have been imposed. In the present case there was immense outrage in the
public as they had recorded a loss of 29 Billion INR and the notification to suspend all business
operations within in the domain of sports analysis was for the public interest, so that in depth
investigation can be conducted and hard earned money lost by the investors in this industry be
traced and disgorged.In the present case the action upon all the business operations by PRA has
taken after the report of the commission. First of all the business of sports analysis is new in
India and when it starts the portal was flooded with a plethora of registration specially in Cricket
so when the news of the man- management in the HMCL comes out it becomes the responsibility

2
Unichoyiv State of Kerala AIR 1962 SCR (1) 946.
3
Krishnan Kakkanath v Govt of IndiaAIR 1997 SC 128.
4
Union of India v International Trading Co[2003] 8 SCC 437.

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MEMORIAL ON THE BEHALF OF RESPONDENT

of the govt. to take actions against those who were involved in it and also to cease all the
business so that proper investigation can be conducted.

Also according to the notification of PRA ‘business operations in this domain shall be suspended
in the interest of the public interests so that an in depth investigation can be conducted and the
hard-earned money lost by the investors in this industry be traced and disgorged’ clearly shows
that the action was taken for the interests of the people at large.

[1.3] THE RESTRICTION IMPOSED BY THE PRA IS TO CURB UNFAIR TRADE

PRACTICE.
It is humbly submitted before the Hon’ble Supreme Court of India that Analyzed Sporting
Predictions (Regulation And Promotion) Act has given power to PRA to revoke or suspend the
registration of all or any registered entity that has engaged in the unfair trade practices. In the
present case CR Den was involved in the unfair trade practice that’s why PRA has taken that
action so that proper investigation can be conducted.

State can restrict trades which practices unfair practices and in the present case CR Den was
involve in unfair trade practices. It was revealed during the investigations carried out by the
‘EoW’ players had often been approached and contacted by the managers of HMCL at rather
odd hours and venues. Also the report by the Mumbai Commissioner suggests an involvement of
CR Den in man- managing the players in HMCL. So for the investigation of the matter and to
safeguard the interest of the people the business was suspended.

In Fertilizer Corporation Kamgar Union Sindri v. Union of India 5court has said that this
fundamental right [19(1)(g)] does not confer the right to carry on any trade, business, occupation
and profession which is unlawful or is hindering general public interest and in the present case
CR Den was involved in unfair trade practices due to which the investor interest gets hindered.

5
Fertilizer Corporation Kamgar Union Sindri v Union of India AIR 1981 SC 344.

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II. THAT THE RIGHT TO PROPERTY OF PREDICIR A GANAR IS NOT VIOLATED

OWING TO THE FRUSTRATION OF CONTRACT BETWEEN PAG AND
GOVERNMENT OF INDIA.
It is humbly submitted before the hon’ble Supreme Court of India that the right to property of
PaG is not violated owing to the frustration of contract between PaG and Government of India.
According to art 31(1) no person shall be deprived of his property saved by authority of law and
PaG has not been deprived of his property as PaG defaulted in making the contractual payments
to the GOI, government has to initiate arbitration proceedings against PaG for breach of contract
and arbitrator has passed an award in favour of GOI bestowing upon it the properties belonging
to PaG. So it was the decision of the arbitrator not the government to take the property of PaG.

[2.1] THE CONTRACT BETWEEN PAG AND GOVERNMENT OF INDIA HAS NOT BEEN
FRUSTRATED DUE TO THE ESTABLISHMENT OF THE PRA.
It is humbly submitted before the Hon’ble Supreme Court of India that the contract between the
PaG and Government of India has not been frustrated as according to section 56 of the contract
act ‘a contract will frustrate where circumstances arise which makes the contract impossible’ but
in the present case establishment of the PRA has not make the contract impossible because even
after the establishment of the PRA, PaG was doing its business without any hindrance.

6
In the case Badri Narayan v. Kamdeo Prasad the enactment of the Bihar Land Reforms Act
1950 did not frustrate the contract under the ghatwali tenures because notwithstanding the
acquisition of the tenures by the state, both grant and the office of the ghatwals subsisted, though
in an altered form and the performance of obligations under the contract could not be said to
become impossible and in the present case even after the establishment of the PRA the
performance of the contract has not become impossible.

PRA was established with the purpose to regulate the business affairs of all the registered entities
in the domain of ASP that has no relation with the impossibility of the contract because the
contractual settlement of PaG with Government was such that whole chunk of the investment was

6
Badri Narayan v. Kamdeo Prasad 2010 SCC OnLine Mad 4476.

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MEMORIAL ON THE BEHALF OF RESPONDENT

to be made by the Government whereas the business input was to be supplied solely by PaG7
and the establishment of PRA has done no harm to the contract.

In another case Ganga Singh v. Santosh Kumar 8it was said that the doctrine of frustration
cannot be permitted to become a device for destroying the sanctity of contract. The court will not
also apply the doctrine of impossibility to assist its obligations under the contract. In the present
case when PaG defaulted in making the contractual payment then the Government initiated the
arbitration proceedings as mentioned in the contract and the arbitrator passed a decision in favour
of Government and gave all properties belonging of PaG to Government on account of its
contractual breaches and when the property has given to the Government, PaG is trying to
destroy the sanctity of the contract by saying that the contract has frustrated due to establishment
of PRA and also its right to property violated.

In the caseAmalgamated Investment & Property co Ltd. v. John Walker & Sons Ltd. 9two days
after the contract of sale of the property was listed for preservation on grounds of architectural
or historic interest, court held that the contract was not frustrated because it could be carried to
completion according to its terms and the property was nonetheless the same, the listing merely
imposing a factor upon its use and in the present case PRA is established merely with the
purpose to safe guards the interests of the investors.

[2.2] THE FUNDAMENTAL RIGHT TO PROPERTY OF PAG HAS NOT BEEN VIOLATED
AS GOVERNMENT HAS NOT DEPRIVED HIM FROM HIS RIGHT TO PROPERTY.
It is humbly submitted before the Hon’ble Supreme Court of India that the fundamental right to
property of PaG has not been violated as government has not deprived PaG from their right to
property. In the contract signed between PaG and the Government of India it is clearly
mentioned that “failure to make payments as stipulated under Clause 6 shall be considered as an
event of default, upon occurrence of which the dispute shall be referred to arbitration10 and
when PaG defaulted in making the contractual payments to the Government of India owing to its
fund getting scantier with each passing day then Government initiated arbitration proceedings
against the PaG for breach of contract.

7
MOOT PROPOSITION PARA 2.
8
Ganga Singh v Santosh Kumar AIR 196 AII 201.
9
Amalgamated Investment & Property co Ltd v John Walker & Sons Ltd [1977] 1 WLR 164.
10
MOOT PROPOSITION, 5.

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MEMORIAL ON THE BEHALF OF RESPONDENT

The arbitrator passed an award in favour of the Government of India and bestowed upon it the
properties of the PaG. Hence the property of the PaG was taken by the process that was
mentioned in the contract.

In the caseKhardan co. Ltd. v. Raymond co.(India) Pvt. Ltd.11court held that in the case of
frustration of contracts, their performance comes to end but the contracts would still be in
existence for purpose of resolution of frustration or impossibility of performance will still have
to be decided under then. Therefore, the arbitration clause does not perish on the frustration of
the contract and hence the decision given by the arbitrator is not arbitrary and not in violation of
fundamental right to property of the PaG.

According to the above case even after the frustration of the contract parties are not released
from their obligation of the contract and that’s why the decision of the arbitrator is binding on
the PaG and not in violation of their right to property.

11
Khardan co Ltd v Raymond co (India) Pvt Ltd [1963] 3 SCR 183.

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MEMORIAL ON THE BEHALF OF RESPONDENT

PRAYER

Therefore in the light of the facts of the case, issues raised, arguments advanced and authorities
cited this Hon’ble court may be pleased to adjudge and declare that:

In the case of PaG and CR Den vs. Union of India:

The notification dated 04.10.2016 issued by the Predictions Regulatory Agency is not violating
the Right to Freedom of Trade and Profession guaranteed under Art 19(1)(g) of the Indian
Constitution.

In the case of PaG vs. Union of India:

The right to Property of Predicir a Ganar has not been violated as there is no frustration of
contract between the government and PaG.

And may pass any other order in favour of the Respondent that it may deem fit in the interest of
justice, equity and good conscience.

SD/-

Counsel for Respondent

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MEMORIAL ON THE BEHALF OF RESPONDENT

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