All disputes are not capable of settlement through arbitration; some by nature have to be adjudicated by courts, according to the Supreme Court. A suit for sale, foreclosure or redemption of mortgaged property should be tried by a court and not by arbitral tribunal, the court stated in the judgment, Booz Allen & Hamilton Inc. Vs SBI Home Finance Ltd. In this case, two firms took loan from SBI to buy flats in Mumbai and they entered into leave and licence agreements with Booz. The borrowers did not repay the loan and so SBI filed a mortgage suit before the Bombay high court. Booz moved the high court for arbitration which was dismissed. Its appeal was also dismissed by the Supreme Court. It stated that a court where the mortgage suit is pending should not refer the parties to arbitration as it is not an “arbitrable” issue. This is so because only a court can protect the interests of third parties. Arbitration deals with only disputes between parties to the arbitration agreement. The court gave similar instances where arbitration should not be attempted, like insolvency and winding up matters, tenancy, wills, criminal offences, matrimonial disputes and guardianship issues.
Mediators appointed to resolve Punjab govt complaint
The Supreme Court has appointed two mediators to resolve the complaint of the Punjab government against the central government over the exodus of industries from that state to neighbouring states. According to Punjab, the central government grants exemptions and concessions in excise duty, income tax and various benefits to Himachal Pradesh, Uttarakhand, Jammu & Kashmir. These are denied to Punjab. Therefore, goods manufactured in Punjab have to pay higher levies. This has crippled industrial growth, the state complained.
High courts cannot act like legislator in tax matters
The Supreme Court has set aside the judgment of the Allahabad high court, stating that the high court had inserted words in a Uttar Pradesh notification which it had no power to do. The court should only interpret provisions of tax laws; it should not take over the role of the supervisor or legislator, the court stated in the judgment, State of UP vs Mahindra & Mahindra. The case arose when the tractor manufacturer moved the high court seeking exemption in the sale/excise duty for tractor engines specifying cubic capacity not exceeding 1800 cc. The high court allowed the writ petition. The government appealed to the Supreme Court. It remitted the matter to the excise tribunal for reconsideration, asking it not to alter the scope of the state notification.
Home-makers be duly considered in assessing compensation
While assessing compensation in road accidents, the work of home-makers and housewives should be properly assessed and “they should not suffer from gender bias”, the Supreme Court stated in the case, Urviben vsVijaybai. The widow, 30, with two children met with an accident in which she became bed-ridden for life. She claimed Rs 15 lakh but the motor vehicle accident tribunal granted her only Rs 6 lakh because she had not much income of her own. The Supreme Court raised it to Rs 15 lakh. It said that she has two children and she needed someone to help her to lead her daily life. Though her own income before the accident was doubtful, “just because she is a home-maker is no reason why the courts should be miserly in fixing compensation.”
Delhi High Court dismisses L&T petition
The Delhi high court has dismissed the writ petition of Larsen & Toubro challenging the Orissa government’s rejection of mining licences in two districts. It had applied for mining lease for iron ore over an area of 611.58 hectares in Village Badamgarh Pahad, Sundergarh district, prospecting licence over an area of 540.475 hectares in Village Khajuridihi Reserve Forest, Sundergarh district, and over an area of 475.955 hectares in Village Rakma & Marsuan, Keonjhar district. These were rejected. The company claimed that in 1995, the Orissa government had made a promise that it would be allowed to use iron ore deposits for captive consumption for the proposed port-based steel plant at Gopalpur. Pursuant to the promise, a Memorandum of Understanding was entered into between L&T and the government. Later it was cancelled after giving a hearing to the company as it was not prepared to carry out the Gopalpur project immediately.
No prior notice needed for seizing bank account during criminal investigation
The Bombay high court has ruled that when a bank account is sought to be seized during criminal investigation, the account-holder need not be given prior notice. In this case, Essar Logistics vs Vinoskumar, the account holder argued that natural justice demanded that he should be given notice before freezing his account. The division bench of the high court rejected his contention and remarked: “It would indeed be absurd to suggest that a person must be told that his bank account, which is suspected of having been used in the commission of an offence by himself or even by another, is being frozen to allow him to have it closed or to have its proceeds withdrawn or transferred upon such notice.”