A corporate body can be imposed fine as punishment though it cannot be imprisoned as it is not a natural person, the Supreme Court reiterated in the case, CBI vs Blue Sky Tie-up Ltd. In this case, the company was facing criminal prosecution, but it moved the Calcutta high court for setting aside the prosecution. It quashed the prosecution on the ground that since the company is only a juristic person it cannot be imprisoned and therefore no punishment can be imposed on a company. The CBI appealed to the Supreme Court, with the Additional Solicitor General arguing that the high court view was against that of the Constitution bench judgment of the Supreme Court in the case of Standard Chartered Bank (2005). The bank, which was being prosecuted for foreign exchange violations, put forward the same argument that it being a juristic person cannot be sentenced to imprisonment. The Constitution bench in a 3:2 ruling, stated that “as the company cannot be sentenced to imprisonment, the court cannot impose that punishment, but when imprisonment and fine is the prescribed punishment the court can impose the punishment of fine which could be enforced against the company. Such a discretion is to be read into the section so far as the juristic person is concerned.” Invoking this principle, the Supreme Court set aside the high court ruling and allowed the prosecution of the company to go on.
Chief Justice SP Bharucha to be arbitral tribunal chairman
The Supreme Court has nominated its former Chief Justice S P Bharucha as the Chairman of the arbitral tribunal to decide disputes between Mauritius firm Indian Industrial Growth Fund Ltd and some persons who entered into contracts for preference and equity shares. The venue for the international arbitration has been fixed at Mumbai. The chairman was selected because the arbitrators appointed by the disputing parties failed to reach agreement with regard to the choice of the chairman. The appointment was made under the Arbitration and Conciliation Act read with the Appointment of Arbitrators by the Chief Justice of India Scheme.
Usha Kumari wins against LIC in Supreme Court
The widow of a person who applied for one Life Insurance Corporation policy but got another by mistake won in the Supreme Court when it found the insurer guilty of lack of due diligence in its dealings. In this case, Usha Kumari vs LIC, husband Kamal Singh deposited Rs 26 lakh in a proposal for New Jeevan Akshay 1 policy. But what he got was New Jeevan Dhara policy. He got monthly pension for some time according to the former policy but died without verifying the policy he received. His widow moved the Rajasthan consumer commission which asked LIC to return the policy amount with interest after deducting some payments. However, the national commission reversed it. On further appeal, the Supreme Court set aside the national commission decision and allowed the widow to get balance of the premium deposited by the insured and lump sum compensation.
Economy airlines get relief from compensation due to bad weather
Economy airlines were granted relief by the Supreme Court when it ruled last week that they are not liable to pay compensation to passengers who suffered delays on account of bad weather conditions at airports. The Lok Adalat and the Andhra Pradesh high court had imposed damages on Indigo airlines for a delay of 11 hours in Delhi airport due to fog. The airline appealed to the Supreme Court. It set aside the high court ruling and emphasized that there was no deficiency in service on the part of the airline. It said that airport authorities should allow passengers to return to the terminal if the flights are delayed for long hours due to weather conditions. “Even low cost carriers have to provide facilitation in terms of tea/water/snacks to passengers of their delayed flights,” the judgment said.
Delhi HC dismisses writ petition of United Biotech Ltd
The Delhi high court last week dismissed the writ petition of United Biotech Ltd against the order of the Intellectual Property Appellate Board in a trade mark dispute with Orchid Chemicals and Pharmaceuticals Ltd. Both of them produce ceftazidime injections. United Biotech named it Forzid, while Orchid called theirs Orzid. The latter objected to it and moved the board. It allowed the rectification application and directed the removal of the trade mark Forzid from the Register of Trade Marks. The board ruled that Forzid cannot be said to be phonetically altogether dissimilar to Orzid. When pronounced, both marks give “only a slightly different sound but structurally and visually the marks have close resemblance to each other.” The high court cited the Supreme Court judgment in the 2001 Cadilla Health Care case which emphasized that “a stricter approach should be adopted while applying the test to judge the possibility of confusion of one medicinal product for another by the consumer. While confusion in the case of non-medicinal products may only cause economic loss, confusion between two medicinal products may have disastrous effects on health and in some cases life itself.”