A correction in the tender offer figures will amount to revocation of the bid and the earnest money deposited can be forfeited on that account, the Supreme Court ruled in the case, Villayati Ram (P) Ltd vs Union of India. The Director General of a Delhi housing project invited tenders and the construction firm was selected as its offer was the lowest. However, after a month the firm made a correction tendered, increasing the cost from Rs 32 crore to Rs 41 crore. The Director General treated the correction as revocation of the contract and forfeited the earnest money of Rs 40 lakh. The firm challenged it in the Delhi high court, and failed. The Supreme Court dismissed its appeal.
DoT’s demand for big phone bill upheld as valid
Arbitration by an employee of one of the parties in a dispute would not by itself render the award invalid, the Supreme Court stated in the case, Department of Telecommunications vs Gujarat Cooperative Milk Marketing Federation. The dispute over wrong billing was referred for arbitration to the deputy director general of the department, while the order against the coop was passed by authorities above him. The co-op argued that the arbitrator in this case being an employee of a lower rank in the department, his award was bound to be biased and therefore, invalid. The Supreme Court rejected this contention and upheld the demand of the department of Rs 4.5 lakh for two months. The normal bill used to be Rs 8,500. The high bill was attributed to international sex calls made from the house of the managing director of the co-op.
Functional disability sustained during duty to be considered
While computing the loss of earning capacity under the Workman’s Compensation Act, it is the functional disability suffered by him in the accident suffered in course of duty that should be considered for assessing damages, the Supreme Court stated in the case, Palraj vs Divisional Commissioner. In this case, a driver of the Karnataka state transport suffered 65 per cent of total body disability and 20 per cent functional disability, according to medical report.
The commissioner under the Act took 85 per cent as the total disability for quantifying the compensation. The high court reduced it from Rs 1.75 lakh to Rs 41,000 as it took the functional disability alone as the criterion. The Supreme Court upheld the high court judgment, especially since the worker has been given an alternative job with the same wages.
‘Inedible’ shrimp exempt from excise
The Supreme Court has dismissed the appeal of the Commissioner of Central Excise, Visakhapatnam, against the ruling of the appellate tribunal, which had held that no duty could be levied on shrimp seeds produced and removed by MCC Blue Water Products Ltd, a 100 per cent export oriented unit in the domestic tariff area without the approval of the development commissioner.
The court upheld the view of the tribunal which stated that the product was not fit for human consumption and was not dutiable at all and quashed the demand of excise.
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Firm told to modify design of products
The Delhi high court last week asked Diat Foods (India) to modify its design for its products, Sugarless Bliss and Splenda, by not giving greater prominence and larger font size to the expression ‘Sugar Free’. This order was passed in a suit by Cadila Healthcare Ltd alleging that Diat was trying to pass off its products as that of Cadila by using the word ‘Sugar Free’ prominently on the carton. Cadila stated that it was using Sugar Free trade mark since 1988, selling the product worth Rs 216 crore. Its complaint was that the two words were being used prominently by Diat. After discussing its earlier judgment in the case of ‘pro-biotic frozen dessert’ by the Gujarat Cooperative Milk Marketing Federation relating to a similar complaint, the high court did not restrain Diat from using the expression ‘Sugar Free’ altogether. Further, it allowed Diat to exhaust the present stock of cartons within 30 days. The order will last till the final judgment is given by the court.
Directors held responsible for bouncing of cheque
If an offence is committed by a company for dishonouring cheque under Section 138 of the Negotiable Instruments Act, all those who were directors of the company, except those excepted by law are responsible, the Delhi high court has stated in a bunch of cases, leading with, Shree Raj Travels vs Destination of the World. The court noted that despite the provision introduced to contain the issue of bad cheques, the complaints are not reducing. It said that since the complaints are based mainly on documentary evidence of bank records, they should be dealt with summarily. As it is, the complaining person is harassed as directors of companies prolong the litigation, depending on the large reserve of the company. Sometimes the directors of companies which mop up large amounts from the public disappear after and cheques are issued without sufficient funds in the bank. While dismissing the appeal of certain directors, the high court also set down guidelines on the procedure to be followed in cheque bounce cases by courts below.