The Board for Industrial and Financial Reconstruction (BIFR) does not lose control over a sick company even if it has revived on its own and its net worth has become positive. The civil court cannot claim jurisdiction on the ground that the company which was once sick has turned the corner, the Supreme Court ruled last week in the case, Ghanshyam Sarda vs M/s Shiv Shankar Trading Co. In this case, some parties moved the civil court which was resisted by others. Thus the dispute arose over the power of the civil court and BIFR. The court stated that the law gave "complete supervisory control to the BIFR over the affairs of a sick industrial company from the stage of registration of reference and questions concerning status of sickness of such company are in the exclusive domain of the BIFR." The judgment asserted that the aspects of revival of such company being completely within its exclusive domain, it is the BIFR alone, which can determine the issue whether such company now stands revived or not. "The jurisdiction of the civil court in respect of these matters stands completely excluded. The BIFR alone is empowered to determine whether the net worth has become positive as a result of which it would cease to have such jurisdiction," the court clarified.
Green signal for 5-star hotel near lakes
Environment rules framed after permission was granted to make constructions cannot be applied to a project, the Supreme Court stated in the case, Vardha Enterprises Ltd vs R K Razdan. In this case, a five-star hotel was to be built in Udaipur, near Fatehsagar lake and the Pichola lake. A public interest case was moved in the Rajasthan High Court alleging that the project, sanctioned in 2009, violated the Wetlands (Conservation and Management) Rules. The high court stopped the project, against which an appeal was moved in the Supreme Court. It directed the authorities to allow the constructions in view of two factors.
The area under construction has not been notified as wetlands under the rules. "Even if such identification were to be made tomorrow, the vested rights of the firm cannot be defeated by executive action," the order said.
Moreover, the firm was given permission in 2009 under the then existing laws.
Non-delivery of yarn to Bangladesh
The Supreme Court has dismissed the appeal of a transporting company which allegedly did not deliver a few consignments of cotton yarn sent from Ahmedabad to Benapole in Bangladesh. In this case, Transport Corporation of India vs Ganesh Polytex Ltd, the latter received intend from Aleef Enterprises calling upon it to export the goods to Azim Garments Ltd in Dhaka. The exporter was required to negotiate the various documents through Islami Bank Bangladesh Ltd, the buyer's banker. Five consignments of goods were entrusted with the transport company. The dispute started when the bank did not honour the documents and did not pay for a long time. The consignments were rebooked. The exporter alleged that the goods were not fully delivered and moved the National Consumer Commission. It ordered the transporter to pay Rs 30 lakh with 12 per cent interest. The appeal was dismissed with the Supreme Court observing that the transporter could not prove that the goods entrusted to it were satisfactorily delivered in Bangladesh.
ICMR to pay for land acquisition
The Supreme Court last week slightly reduced the compensation awarded to land owners in Belgaum, whose land was acquired for a research centre for Indian Council of Medical Research. The government notified the acquisition in 1994 and the land acquisition officer assessed the compensation at Rs 1,050 per 'gunta' or Rs 42,000 per acre. The land owners moved the civil court for re-determination.
It hiked the amount to Rs 7,000 per 'gunta'. They appealed to the Karnataka High Court for higher rate. It enhanced the compensation to Rs 99,000. Therefore ICMR, a central government organisation, moved the Supreme Court. It arrived at Rs 70,000 per 'gunta' applying the relevant factors like: the location of the land, its potentiality, the rate at which adjoining lands were sold a few months before, the condition of the undeveloped lands and expenditure required to develop it for the project.
Insurer to pay higher compensation
Rejecting the computation of compensation in a road accident case by the Himachal Pradesh High Court, the Supreme Court directed the insurance company to pay an enhanced amount to the widow and two minor children in the appeal case, Kala Devi vs Bhagwan Das. The 25-year-old matriculate driver died when he pushed his vehicle stuck over snow and the vehicle toppled over him. The wife and children claimed Rs 13 lakh as compensation but the tribunal granted only Rs 4.40 lakh. On appeal, the high court raised it to Rs 7 lakh. On appeal to the Supreme Court it raised the compensation further to Rs 14.61 lakh, more than what was originally demanded. The Supreme Court observed that the high court had granted only a meagre sum of Rs 30,000 for loss of consortium and Rs 40,000 for loss of love and affection with regard to children. The court raised it to Rs 1 lakh each as per earlier guidelines set in a leading judgment.
No TDS on deposits with court
The Delhi High Court last week set aside the demand of the tax authorities which insisted that in cases where deposits were made in terms of directions issued by the court, the banks were required to deduct tax at source and issue tax deducted at source certificates. The CBDT had also issued a circular to that effect. The high court, in its judgment in the case, UCO Bank vs Union of India, struck down the circular on several grounds. "The circular," said the court, "proceeds on an assumption that the litigant depositing the money is the account holder with the bank and/or is the recipient of the income represented by the interest accruing thereon. This assumption is fundamentally erroneous as the litigant who is asked to deposit the money in court ceases to have any control or proprietary right over those funds. The amount deposited vests with the court and the depositor ceases to exercise any dominion over those funds. It is also not necessary that the litigant who deposits the money would be the ultimate recipient of those funds. The person who is ultimately granted the funds would be determined by orders that may be passed subsequently."
Green signal for 5-star hotel near lakes
Environment rules framed after permission was granted to make constructions cannot be applied to a project, the Supreme Court stated in the case, Vardha Enterprises Ltd vs R K Razdan. In this case, a five-star hotel was to be built in Udaipur, near Fatehsagar lake and the Pichola lake. A public interest case was moved in the Rajasthan High Court alleging that the project, sanctioned in 2009, violated the Wetlands (Conservation and Management) Rules. The high court stopped the project, against which an appeal was moved in the Supreme Court. It directed the authorities to allow the constructions in view of two factors.
The area under construction has not been notified as wetlands under the rules. "Even if such identification were to be made tomorrow, the vested rights of the firm cannot be defeated by executive action," the order said.
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Moreover, the firm was given permission in 2009 under the then existing laws.
Non-delivery of yarn to Bangladesh
The Supreme Court has dismissed the appeal of a transporting company which allegedly did not deliver a few consignments of cotton yarn sent from Ahmedabad to Benapole in Bangladesh. In this case, Transport Corporation of India vs Ganesh Polytex Ltd, the latter received intend from Aleef Enterprises calling upon it to export the goods to Azim Garments Ltd in Dhaka. The exporter was required to negotiate the various documents through Islami Bank Bangladesh Ltd, the buyer's banker. Five consignments of goods were entrusted with the transport company. The dispute started when the bank did not honour the documents and did not pay for a long time. The consignments were rebooked. The exporter alleged that the goods were not fully delivered and moved the National Consumer Commission. It ordered the transporter to pay Rs 30 lakh with 12 per cent interest. The appeal was dismissed with the Supreme Court observing that the transporter could not prove that the goods entrusted to it were satisfactorily delivered in Bangladesh.
ICMR to pay for land acquisition
The Supreme Court last week slightly reduced the compensation awarded to land owners in Belgaum, whose land was acquired for a research centre for Indian Council of Medical Research. The government notified the acquisition in 1994 and the land acquisition officer assessed the compensation at Rs 1,050 per 'gunta' or Rs 42,000 per acre. The land owners moved the civil court for re-determination.
It hiked the amount to Rs 7,000 per 'gunta'. They appealed to the Karnataka High Court for higher rate. It enhanced the compensation to Rs 99,000. Therefore ICMR, a central government organisation, moved the Supreme Court. It arrived at Rs 70,000 per 'gunta' applying the relevant factors like: the location of the land, its potentiality, the rate at which adjoining lands were sold a few months before, the condition of the undeveloped lands and expenditure required to develop it for the project.
Insurer to pay higher compensation
Rejecting the computation of compensation in a road accident case by the Himachal Pradesh High Court, the Supreme Court directed the insurance company to pay an enhanced amount to the widow and two minor children in the appeal case, Kala Devi vs Bhagwan Das. The 25-year-old matriculate driver died when he pushed his vehicle stuck over snow and the vehicle toppled over him. The wife and children claimed Rs 13 lakh as compensation but the tribunal granted only Rs 4.40 lakh. On appeal, the high court raised it to Rs 7 lakh. On appeal to the Supreme Court it raised the compensation further to Rs 14.61 lakh, more than what was originally demanded. The Supreme Court observed that the high court had granted only a meagre sum of Rs 30,000 for loss of consortium and Rs 40,000 for loss of love and affection with regard to children. The court raised it to Rs 1 lakh each as per earlier guidelines set in a leading judgment.
No TDS on deposits with court
The Delhi High Court last week set aside the demand of the tax authorities which insisted that in cases where deposits were made in terms of directions issued by the court, the banks were required to deduct tax at source and issue tax deducted at source certificates. The CBDT had also issued a circular to that effect. The high court, in its judgment in the case, UCO Bank vs Union of India, struck down the circular on several grounds. "The circular," said the court, "proceeds on an assumption that the litigant depositing the money is the account holder with the bank and/or is the recipient of the income represented by the interest accruing thereon. This assumption is fundamentally erroneous as the litigant who is asked to deposit the money in court ceases to have any control or proprietary right over those funds. The amount deposited vests with the court and the depositor ceases to exercise any dominion over those funds. It is also not necessary that the litigant who deposits the money would be the ultimate recipient of those funds. The person who is ultimately granted the funds would be determined by orders that may be passed subsequently."