The Supreme Court (SC) last week set aside the decision of the National Consumer Commission in the case, Dilawari Exporters vs Alitalia Cargo, holding that exporters have a right to claim compensation from the airline for delay in delivery of goods sent from India to the US, though it was handled by an agent. The Indian firm handed over garments to Fourways Movers Ltd for onward dispatch to New York. But it did not reach there on the stipulated date. The US importer therefore cancelled the order. The Indian firm moved the commission alleging deficiency in service and claiming damages. The airline denied negligence and denied any privity of contract between it and the exporter. The commission rejected the complaint, accepting the argument of the airline that there was no privity of contract. The airline argued that its contract was with shipper Fourways Movers only and not with the exporter. However, the SC, after examining the air waybill and other documents, stated that Fourways Movers was acting in a dual capacity – one as a shipper on behalf of the exporter and the other as agent of the airline. Therefore, the airline was bound by the acts of the agent. Since this aspect escaped the notice of the commission, it was asked to reconsider the claim.
Tax relief to manufacturers of aluminium product
The SC has set aside the ruling of the Allahabad high court and granted tax relief to manufacturers of aluminium product, properzi rods, in the judgment, Jai Vijai Metal Udyog Ltd vs Commissioner of Trade Tax. Though the company was earlier charged a lower sales tax, in later assessments the revenue authorities demanded a higher rate on the ground that the aluminium product was a ‘rolled product’ and not a primary metal deserving lower levy under the UP Trade Tax Act. Though the tax tribunal did not agree with the authorities, the high court accepted their view on the basis of the SC judgment in the case of Hindalco, which makes the same product. The Supreme Court pointed out that subsequently it had held that the product was liable to lower duty. Therefore the same rate should be applied in the case of this company also, the judgement said.
Income tax deduction claimed for bad debt
A bad debt written off in the book of accounts of a bank assessee is sufficient ground for claiming income tax deduction, the SC has ruled in the case, Vijaya Bank vs Commissioner of Income Tax. In this appeal, the question was whether it was imperative for the bank to close the individual account of each of its debtors in its books or a mere reduction in the loans and advances on the asset side of its balance sheet to the extent of the provision for bad debt would be sufficient to constitute a write-off. The Supreme Court answered the question in favour of the bank.
States told to return stolen vehicles to owners
The SC last week directed all states and union territories to ensure that stolen and lost motor vehicles are returned to the owners and insurers without delay. At present they are rotting in various places pending the end of prolonged litigation. Non-compliance of the order would be dealt with an "iron hand", the court stated in the judgement, General Insurance Council vs State of Andhra Pradesh. It directed the respective IGs/City Police Commissioners and SPs to ensure implementation of its orders. General Insurance Council is an umbrella organisation of insurance companies. It moved the court alleging gross negligence of the authorities and courts in ensuring return of the stolen/lost vehicles resulting in their turning into junk.
Claim over ‘Ayur’ in court
The Delhi high court has passed an injunction in favour of Three-N-Products Ltd against Holistic Health Care Ltd in the dispute over the trademark ‘Ayur’. The first firm contended that it has the right to the registered trade mark, while the latter had entered the same business with the mark ‘Ayurcare’. Both were in the health services and wellness programmes, like running spa, dance classes, abstract body art, Su-Jok, spiritual and holistic healing. The high court stated that the first firm made prior use of the mark Ayur and therefore it was entitled to enforce its rights as a registered proprietor of the mark. It has at least prima facie established that its mark is well known and acquired wide reputation not only in India but also in various countries across the globe. “In the circumstances, Holistic Health Care company’s use of the mark is not only detrimental to the distinctive character and repute of the registered trade mark of Three-N, but also has been used by Holistic to take unfair advantage,” the judgment said.