Plea in Bengal Paper Mill case rejected

LEGAL DIGEST

The Supreme Court last week dismissed the applications moved by Eastern Minerals & Trading Agency, Zoom Traders & Reality Ltd and the Bengal Paper Mill Mazdoor Union seeking clarifications in the Allahabad Bank vs Bengal Paper Mills Company case judgment, delivered a few years ago. Eastern Minerals had bought Bengal Paper, which was on liquidation, for Rs 2 crore.

Though the Calcutta High Court had confirmed the sale, it was challenged in the Supreme Court. It found that the price fixed was "shockingly low" and that too was allowed to be paid in four instalments. The assets were handed over the next day and they were enjoyed by the buyer for 10 years.

In view of this, the sale was set aside. Now the buyer company sought interest on the payment made. The court dismissed its application. It further dismissed the application of the trade union that wanted the company in liquidation to be sold as a going concern. Similarly, it rejected the plea of Zoom Traders, which offered Rs 17.75 crore for the entire assets on "as is where is" basis.

Air-India challenges Bombay HC order

Air-India has moved the Supreme Court against the Bombay High Court judgment restraining it from flying its planes with several untrained cabin crew members.

According to the Air India Cabin Crew Association, which moved the high court, the policy was in contravention of Rule 38 of the Aircraft Rules and a danger to the safety of the flights.

They alleged that the management was allowing a number of untrained crew members along with trained members. A trained member must be paid at the rate of $5.5 an hour. An untrained person, on the other hand, is paid at the rate of $ 2 an hour.

Though the airline is saving on payment, it was both illegal and dangerous, according to the association. Though the appeal had come up before two benches in recent days, it could not be heard by them because of procedural reasons.

Delhi High Court order set aside

The Supreme Court has set aside the decision of the Delhi High Court in the dispute over the election of the board of directors of the National Co-operative Consumers Federation of India Ltd, set up under the Multi-state Co-operative Societies Act.

It was alleged that defaulting members were given voting rights, the proposers and seconders were not valid voters and they had not paid the minimum share capital on time. Instead of one vote, each delegate had cast five votes, it was contended. The complaint was referred to the Union minister of agriculture, but there was further legal wrangles on the issues.

In the present judgment, the Supreme Court asked the central registrar appointed under the Act to proceed expeditiously with the hearing of complaint about the election and determine the issues on merits.

SC upholds order of custodian

The Supreme Court last week dismissed the appeal of Fairgrowth Investments Ltd against the notification of the custodian under the Special Courts Act dealing with the 1992 securities scam.

According to Section 4(2) of the Act, any person aggrieved by a notification issued by the custodian may object to it within 30 days. In this case, the Act came into force in 1992 and the company was notified in 2001.

The company filed its objection after nearly a year. The special court rejected the application on the ground of delay. The company argued that their objection should not be rejected on a technical ground as the consequences were drastic, like attachment of their property.

The apex court rejected the plea and said the objection was filed much beyond the prescribed period, therefore the special court was right in dismissing its petition.