The Supreme Court last week set aside the judgment of the Calcutta high court which had upheld the acquisition of several floors of a building in Kolkata occupied by certain companies. The West Bengal government earlier requisitioned the floors but at the end of the 25-year period, notified the property for acquisition for “public purpose”, namely for permanent office accommodation of the Public Works Department. This was opposed by the owners. However, they were not given a proper hearing and the property was acquired. When the government action was challenged in the high court, both the single judge and the division bench dismissed the petition. In the appeal before the Supreme Court, it was argued that the right to raise objections and being heard was not an empty formality and have been raised to the level of a fundamental right by the court. Agreeing with the contentions, the Supreme Court stated in the judgment, Kamal Trading Ltd vs State of West Bengal, that the objections of the owners were rejected on a “very vague ground”. Mere use of the words “for greater interest of public” is not enough, the court asserted while quashing the acquisition.
Suspicion cannot justify IT search
The Bombay high court has stated that a roving enquiry based on mere suspicion about the sudden growth of a company did not justify search warrant. The satisfaction of the authorities to authorise search contemplated under Section 132 of the Income Tax Act must be based upon “contemporaneous material and information becoming available to the competent authorities prescribed in that Section. Its availability and nature as also time factor must also be ascertainable from relevant records containing such satisfaction note. Loose satisfaction notes, placed by authorities before each other cannot meet these requirements of law,” the division bench said in the judgment, Spacewood Furnishers vs Director General of Income Tax. The company was searched on a mere suspicion about its sudden spurt in growth. The Assistant Director of Income Tax suspected that the company has been suppressing substantial portion of income by inflating purchases and other expenses. He also felt that the company was catering to high end customers and enjoying very high margins, availing loans against third party NRI deposits whose identity and genuineness was doubtful. It was also alleged that substantial unreconciled amounts were found in the bank account of the company. The high court, however, did not find substance in the allegations and quashed the search undertaken by the authorities.
Internet domain name dispute
The Delhi high court last week upheld the arbitral award in the dispute between Stephen Koenig and Jagdish Purohit over the domain name 'internet.in'. The arbitrator directed striking off of the name in favour of Koenig. It also held that Purohit was not entitled to the transfer of the name in his favour. Purohit filed a complaint before the .IN Registry of the National Internet Exchange of India (NIXI) invoking the .IN Domain Name Dispute Resolution Policy ('INDRP') to the effect that the domain name 'internet.in' registered by Stephen Koenig was identical and confusingly similar to his registered trade mark 'internet'. He also argued that Koenig had no rights or legitimate interests in respect of the domain name and that the name was being used in bad faith. The Koenig defended the domain name registration in his favour. The arbitrator passed the award in which he concluded that the domain name 'internet.in' should be struck off and confiscated and kept by the .IN Registry. He rejected the prayer of Purohit that the domain name should be transferred to him. The high court largely upheld the award, observing that the arbitrator was justified in doubting the purposes of Koenig in having to register as many as 1,747 domain names to carry on his business. The high court also set aside the direction in the award that the domain name 'internet.in' should be confiscated and kept by the .in Registry.
Challenge to airport radar tender
The Delhi high court last week dismissed with cost the writ petition of Thales Air Systems SA challenging the revised price bid invited by Airport Authority of India in a global tender. The government and the authority invited bids for supply, installation, testing and commissioning of eight co-located airport surveillance radars for airports at Amritsar, Chennai, Cochin, Kolkata, Mumbai and Delhi. The company claimed it was the lowest bidder and therefore the letter of award should have been issued to it. It further alleged that the authorities wanted to choose either Canada Radar Systems or Eldis and therefore revised the price and called for fresh tender. Eldis offered the lowest bid, but it was contended that it was technically disqualified. After examining the procedure adopted for the tender, the court concluded that the decision was not flawed.