The Supreme Court last week appointed its former judge, Justice Arijit Pasayat, as the arbitrator in a dispute between South African firm Denel Ptonics and government-owned Bharat Electronics Ltd. The Indian company placed orders for electronic equipment and the foreign firm supplied it. However, after accepting the goods, the public sector company refused to pay the bills only on the ground that the Ministry of Defence had issued a direction to it that it should discontinue dealings with the foreign firm and all payments should be withheld. Denel invoked the arbitration clause in the contract. Then the government company disputed its liability for payment and rejected the name proposed by Denel. Therefore, Denel approached the Supreme Court to nominate a person under the Arbitration and Conciliation Act.
Court dismisses Madras Cement appeal claiming Modvat credit
The Supreme Court last week dismissed the appeal of Madras Cements Ltd claiming Modvat credit on certain goods which it maintained were capital goods eligible for the benefit. The company argued that parts of the bucket elevator and wagon loaders belonged to the machinery embedded in the mining complex and were integral parts of the factory. Therefore it claimed Modvat credit under Rule 57-Q of the Central Excise Rules.
RPG Life Sciences fined Rs 2 lakh
After 25 years of litigation, the Supreme Court has ordered RPG Life Sciences Ltd to pay Rs 2 lakh as fine for selling medicines without printing the maximum retail price (MRP) on the package. The Madras high court had convicted the production manager and two distributors and sentenced them to three months imprisonment. In 1985, the drug authorities had found 68 bottles containing 100 tablets of haloperiodol each without the MRP. This was violation of the Drug (Prices Control) Order and the Essential Commodities Act. The Supreme Court converted the sentence of jail to fine on the firm. The other accused persons shall pay Rs 25,000 to avoid imprisonment.
Karnataka HC judgment on Negotiable Instruments Act upheld
Whether a cheque bounces due to insufficiency of fund in the bank account of the drawer, or whether he issues a ‘stop payment’ order to the bank, the consequences under the Negotiable Instruments Act would be the same, the Supreme Court held last week in the appeal, Rangappa vs Sri Mohan. Upholding the conviction of the drawer of the cheque, passed by the Karnataka high court, the Supreme Court further explained that when a cheque is issued, there is a presumption that it is to clear a debt or liability. The drawer of the cheque can, however, rebut the presumption. “There can be no doubt that there is an initial presumption which favours the complaining person,” the judgment said.