Shaw Wallace appeal dismissed

LEGAL DIGEST

The Supreme Court last week dismissed the appeals of Shaw Wallace, Karnataka Bank Ltd and another firm which had challenged the imposition of profession tax by Andhra Pradesh government on each of its branches within the state.

It upheld the provision in the AP Tax on Professions, Trades, Callings and Employments Act and interpreted the word 'person' to mean each branch of the company in the state. The companies had argued that since they had one main office in the state and several retail outlets they should not be charged the profession tax separately.

They had no independent existence apart from the company. The Supreme Court rejected their argument and held that the definition of person given in the Act was constitutional. The integrity of the company is not affected. The branches are treated separately only for the purpose of the state tax.

SC: No insurance benefit if driver does not have a valid licence

The Supreme Court has set aside the ruling of the National Consumer Commission and reiterated that an insurance company is not bound to pay motor vehicle insurance if the driver had no valid licence.

Allowing the appeal of Oriental Insurance Co Ltd, the court stated that the commission had taken a wrong view on facts. In another motor vehicle accident compensation case last week, National Insurance Company Ltd vs Annappa Irappa, the Supreme Court dismissed the appeal of the insurance company alleging that the driver had no valid licence.

It ruled that a driver who had a valid licence to drive a light motor vehicle was also authorised to drive a light goods vehicle according to the amendment to the Motor Vehicles Rules made in 1989.

ASHP appeal allowed

The Supreme Court last week stated that civil courts should not take up cases which fall within the ambit of the Industrial Disputes Act. Labour disputes should be resolved through the machinery set up under the special law, it said while allowing the appeal of the Chief Engineer of the Anandpur Sahib Hydel Project.

In this case, nine temporary workers moved the sub-judge challenging their termination after the work was completed. The judge, including the appellate courts up to the Punjab and Haryana High Court, upheld this view. On appeal, the Supreme Court emphasised that such disputes should not be adjudicated by civil courts.

Indian Dairy Machinery appeal dismissed

The Supreme Court last week dismissed the appeal of Indian Dairy Machinery Co Ltd against the judgment of the Karnataka High Court involving the question of sales tax benefits for goods received from outside the state.

In this case, the company was registered in Gujarat and it had a branch office in Bangalore. It is a sub-contractor for Larsen & Toubro Ltd for execution of works contracts. It opted for composition under the Karnataka Sales Tax Act. But this benefit was denied by the state assessing officers.

The Supreme Court stated that according to a 2002 amendment in the state law, the benefit of composition was not available to units which receive goods from outside the state for the purpose of using such goods in the execution of works contracts.

SC strikes down condition imposed by Kerala government

The Supreme Court last week struck down certain conditions imposed by the Kerala government on those doing business in minor minerals in the case, K T Verghese vs State of Kerala.

One of the conditions was that the dealers must sell the minerals, limeshell in this case, only within the state and that too, for domestic or agricultural purposes. Cooperative societies are not bound by this condition. The dealer challenged these rules as arbitrary and discriminatory.

The high court rejected his argument stating that the state government had the power to impose such conditions. However, on appeal, the Supreme Court struck down the conditions, relying on its earlier judgment in the Tamil Nadu minerals case delivered in 1995.