The Supreme Court has set aside the order of the Bombay high court which had stopped all constructions over the portion of a land in Mumbai which was acquired for telecom companies. The high court passed the order in a public interest litigation raising issues which are 85 years old. About 775 acres were acquired for Indian Radio Telegraph Company in 1925. After Independence, the company was taken over by the government of India. Later it was transferred to VSNL and then Tata Communications. Some persons sought higher compensation for the land recently and the high court passed the order in January this year stopping all constructions in the disputed area. Tata Communications appealed to the Supreme Court and it set aside the high court order, stating that if the claimants are entitled to compensation, it shall be paid to them by the authorities in accordance with law.
Plea for benefits of SSI dismissed
The Supreme Court last week dismissed the appeal of Parle Bisleri Ltd challenging the ruling against it by the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) in an excise dispute over its soft drink flavours and the use of their brand names. Apart from Parle Bisleri, two others involved were Parle Exports Ltd and Parle International Ltd. Parle Bisleri claimed excise benefits as a small scale industry in the 1990’s. The claim was rejected by the tribunal. It appealed to the Supreme Court, which stated that the tribunal was right in denying the benefit by clubbing the products of the three companies. The court said: “the three companies in question were intertwined in their operation and management… It would likely seem that the purported fragmentation of the manufacturing process was but a mere ploy to avail of the SSI exemption. Piercing the corporate veil, when the notions of beneficial ownership and interdependency come into the picture, are no longer disputed questions. On this count, therefore, we have no hesitation whatsoever in affirming the order of the tribunal,which was justified entirely through the precedent set by this court.”
Demand of Excise Department for penalty dismissed
The Supreme Court has set aside the penalty demanded by the excise authorities from Pepsi Foods Ltd because there was no intentional default on the part of the company. But the court overruled the excise tribunal on the question of inclusion of freight charges between Pepsi factory and Frito-Lay India. Till 1998, the company was selling its food products to Frito-Lay India, said to be a ‘related person’. Pepsi maintained that the sale occurred at its factory gate for purposes of excise duty. The authorities considered the price at which wholesalers got the goods from Frito-Lay. In this dispute, the commissioner held that the freight charges between the Pepsi factory and Frito-Lay unit should be included in the sale price. On appeal, the tribunal ruled that the freight should be excluded. The court stated that in situations where the assessees sold its goods to a related person, “It was prudent to understand that the price in such a sale would be deliberately understated so as to evade tax. It was to dissuade such sales that the legislature had decided to deem the price of the goods at the time of their sale by related persons to wholesale markets.”
Goods hired for commercial use not covered by Consumer Protection Act
The Supreme Court last week stated that goods and services hired for commercial purposes cannot be the subject matter of a consumer complaint under the Consumer Protection Act. It set aside the judgment of the National Consumer Commission in the case, Birla Technologies Ltd vs Neutral Glass and Allied Industries Ltd. Birla Technologies developed software for Neutral Glass and later there were complaints about the modules. Neutral Glass moved the consumer commission. It held that though the company was not a consumer under the definition, since the complaint was lodged within the warranty period, it could get relief. Birla Technologies appealed to the Supreme Court. It stated that since the complainant used the goods and services for commercial purposes, its complaint was not maintainable.
Dismissed, convicted employee cannot claim backwages
A person who was convicted for an offence and removed from service cannot claim backwages even if he was acquitted later, the Supreme Court ruled in the case, Corp Mithilesh vs Union of India. Merely because he is acquitted, he is not entitled to backwages and other consequential benefits, the court said.