The Supreme Court last week set aside the judgment of the Monopolies & Restrictive Trade Practices Commission in which Philips Medical Systems Inc of the US was held guilty of unfair trade practice. The complaint was filed before the commission by Indian MRI Diagnostic Ltd alleging that the US firm failed to supply goods and therefore it had to import them from Japan incurring a loss.
The commission ordered the US firm not to indulge in such unfair trade practice. The two judges of the Supreme Court, however, differed in their view of unfair trade practice. One judge stated that there could be no unfair trade practice when the goods were not supplied at all.
The other judge felt that “there might be situations where a promise to supply a particular good, which the supplier knew that he was in no position to supply, with a motive of promoting of some other model, as has happened in the present case, could occur.”
Automatic reinstatement of a worker should not be ordered: SC
The Supreme Court has emphasised that if the termination of a worker is illegal, the labour court should not automatically order his reinstatement with back wages. He can be given compensation.
The apex court thus set aside the order of the labour court and the Allahabad High Court in the appeal of UP State Electricity Board vs L K Gupta. In this case, the temporary worker had worked for only two years when he his services were terminated. After ten years, he moved the labour court which ordered his reinstatement.
The board appealed to the high court which ordered it to pay salary till the case was decided. Thus, he got Rs 7 lakh without working. The Supreme Court stated that this was enough compensation for the temporary worker.
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SC says concept of advance licence different from excise
The Supreme Court has set aside the judgment of the Madhya Pradesh High Court which had declared unconstitutional certain circulars implementing the state liquor policy. According to one circular, liquor will be supplied to contractors in a specific fortnight against the amount deposited and in case there is short deposit, the duty will be deposited in the next fortnight, but no liquor will be supplied during the defaulting fortnight.
This rule was challenged by contractors and the high court struck it down. The state government appealed to the Supreme Court. It overruled the high court. It clarified that the concept of advance licence fee is different from excise duty and the high court had confused the two.
Valid driving licence at the time of road accidents must for compensation : SC
The Supreme Court has quashed the judgment of the Rajasthan High Court which had asked National Insurance Co to compensate a road accident victim. The driving licence of the driver was not in force at the time of the accident.
The claimants argued that the driving licence was being renewed from time to time and though the licence was not valid at the time of the accident, it was renewed for a further period of three years soon after.
The tribunal and the high court accepted this argument and asked the insurance company to pay the claimants Rs 4 lakh. On appeal, the Supreme Court clarified that according to its earlier rulings, the insurer will be liable to pay only if the licence was valid at the time of the accident.
Sony India not to be penalised for imports
The Supreme Court has dismissed the appeal of the Commissioner of Customs against Sony India Ltd and set aside the penalty imposed on the company manufacturing colour TV.
The company stated that it had imported parts of the TV sets, while the commissioner insisted that they were complete sets. The customs tribunal ruled that the goods were components which could not be treated as complete sets. The commissioner appealed to the Supreme Court, which upheld the tribunal’s finding.
Appeal by Commissioner of Income Tax set aside
The Supreme Court has dismissed the appeal of the Commissioner of Income Tax, granting relief to HCL Comnet Systems & Services Ltd, which is engaged in satellite communication services. In its returns, the company debited an amount on account of bad debts to the ‘profit and loss account’.
However, the assessing officer added the amount to the book profits as per explanation (c) to Section 115JA of the Income Tax Act. The court stated that the officer was not justified in doing so, observing that “the debt is the amount receivable by the assessee and not any liability payable by it and therefore any provision made towards irrecoverability of the debt cannot be said to be a provision for liability.”