Freight and insurance charges incurred by the dealer form part of the sale price and included in the turnover and consequently they are liable to be taxed both under the Central Sales Tax Act and the state law, the Supreme Court stated last week while upholding the view of the Madras high court. It dismissed the appeal of India Meters Ltd, a company which manufactures electric meters and supplies them to electricity boards. The revenue authorities in Tamil Nadu had included the goods in the taxable turnover under both the laws. The company moved the Tamil Nadu Taxation Special Tribunal and later the high court where in both cases it had failed. The Supreme Court dismissed the appeal with costs.
Daily worker cannot be reinstated
The Supreme Court has ruled that a daily worker who was retrenched violating the provisions of the Industrial Disputes Act cannot be ordered to be reinstated; but he can be monetarily compensated. In this case, Incharge Officer vs Shankar Shetty, the daily wage worker was employed intermittently for seven years and then relieved of the job. He moved the labour court arguing that he had completed 240 days in year and therefore the retrenchment was illegal under Section 25F of the Act. The labour court rejected his contention, but the Karnataka high court ordered his reinstatement without back wages. On appeal, the Supreme Court set aside the high court ruling stating that monetary compensation would be enough to meet the ends of justice.
Order without reason earns cosumer commission apex court’s ire
The Supreme Court last week admonished the National Consumer Commission for passing orders without giving reasons for its conclusion. “Reason is the soul of law, and when the reason of any particular law ceases, so does the law itself,” the judges observed in a case involving Kranti Associates Ltd and Corporation Bank, both of whom had appealed against the commission’s cryptic order. The court laid down 15 guidelines to the courts below regarding the necessity of giving reasons in their judgments. It emphasised that a judgment should not be like the “inscrutable face of a Sphinx.” The case was remitted to the commission for reconsideration and writing judgment with reasons.
‘HC need not pass orders that affect working of banks’
The Supreme Court has allowed the appeal of Reserve Bank of India and observed that a court dealing with bail of bank executives accused of fraud should not order release of funds to depositors. In this case, RBI vs General Manager, some top executives of a cooperative bank were being prosecuted. Some of them were granted bail. The depositors moved the Gujarat high court for cancellation of their bail. While the high court did not cancel bail, it passed an order to the bank to distribute amounts to the poor depositors, who had invested less than Rs 10,000. RBI appealed to the Supreme Court stating that the order was beyond the scope of a bail application and infringed the provisions of the Banking Regulation Act. Agreeing with this, the Supreme Court stated that “it was not open to the high court to pass orders which could affect the working of banks all over the country.”
Man insured 4 hours earlier gets compensated
Oriental Insurance Company has agreed before the Supreme Court that it would pay compensation to Dharam Chand, who met with a road accident four hours after he paid the premium for insurance on the last day for payment. Earlier, the motor vehicle accident tribunal and the Punjab and Haryana high court had asked the insurer to pay compensation, but it appealed to the Supreme Court arguing that the insurance cover will start only a day after the premium was received.
HC upholds award of contract for Coast Guard vessels
The Delhi high court last week dismissed the writ petition of Larsen & Toubro with heavy costs and passed severe remarks against it for its mala fide attitude in challenging the award of contract to a rival. The government floated a ‘Request for Proposal’ for 20 patrol vessels for the Coast Guard from the company as well as others. The government chose Cochin Shipyard Ltd. L&T wanted the government to invite it. Rejecting the prayer, the court stated: “The L &T bid was clearly non-responsive and it was not entitled to the contract. Its attitude unfortunately in the facts of this case is wholly unreasonable. It intends to create nuisance value although its bid was rightly rejected. We have already stated that the company seems to think that either it should get the contract or no one else, which is unacceptable. We have also highlighted its mala fides and its desperation by seeking to cancel the contract awarded to Cochin Shipyard.”