Brief case: Political clout in mining lease

A weekly selection of key court orders

The Supreme Court (SC) last week said a firm in Haryana had obtained a mining lease in a devious way, with apparent “influence in high places”. Though the firm was not eligible to get the lease, it created a joint venture (JV) for bidding and was successful in getting the lease for mining in Bhiwani district. But, after some time, the JV was dissolved with the partner transferring all his shares to the firm. The state's Department of Mines, which granted the licence, then cancelled it. The firm also found while it had bid Rs115 crore, the Haryana State Industrial and Infrastructure  Development Corporation, a government undertaking, got mining land at a cheaper rate, affecting its commercial viability. This led to long litigation. The firm challenged the cancellation in vain in the high court (HC), and some others also moved the court against the grant of lease through the JV route. Concluding the litigation in the case, Sunder Marketing Associates vs State of Haryana, the SC passed an order allowing the firm to continue mining only till November 30 and pay royalty and all dues, including those of the employees. The judgment said: “This is a classic case of someone apparently having influence in high places, using that influence to violate the law and get a benefit that would ordinarily not be granted to anybody else. We cannot say with any degree of certainty how high is the reach of the petitioner but it is quite apparent from the facts of the case, that the reach is pretty high.” 

Judges in their own cause 

The High Court (HC) of Jharkhand has denounced the practice of government authorities nominating its busy executives as arbitrators, who drag on the proceedings for years. In this case, Sahil Projects vs Eastern Railway, three arbitral tribunals consisting of railway officials were constituted but did not conclude the proceedings in a decade. Therefore, the aggrieved contractor moved the HC, which appointed its own ex-judge as arbitrator. The judgment pointed out the new amendment to The Arbitration and Conciliation Act, which listed persons who are ineligible to be arbitrators as they cannot be expected to act independently and neutrally. Leaving the private firm at the mercy of officials against whom claims are made would add insult to injury and affect the credibility and impartiality of the whole process, the judgment stated quoting Supreme Court judgments in similar situations after the amendment to the law. Normally, the top officials are busy with their routine responsibilities with little time for adjudication. Picking them strikes at the root of fairness and speedy conclusion of arbitration, the court said.

College not run by ‘aid of power’ 

An educational institution using electricity for fans, lighting and other ordinary amenities is not an establishment “working with the aid of power” like a factory. Therefore, the provisions of the Employees' Provident Funds Act and other labour welfare laws will not be applicable to it on the ground it is working with the “aid of power”. The Bombay High Court (HC) stated so in the case, Aniket College of Social Work vs Assistant Provident Fund Commissioner. The enforcement officer found after inspection that the college, registered under the Societies Registration Act, had defaulted in remitting provident fund, family pension and insurance under various welfare schemes. The college pleaded that it was employing less than 50 people and, therefore, the laws were not applicable on it. Moreover, it was not working with the aid of power like an industry. The authorities did not accept the argument. The college moved the HC but a single-judge Bench rejected the petition, stating even if electricity or power is used by an educational institution for lighting, cooling or heating, the work of teaching is with the aid of power. He further maintained only establishments to which there is no power supply are exempted. The college appealed to the division Bench and succeeded in convincing it. The division Bench overruled the earlier judgment. It said the law invoked was indeed a welfare legislation, and required a liberal interpretation “but if the use of power is only to operate tube lights or fans as in this case, such use of power shall certainly not imply that the imparting of education is with the aid of power.” However, if education is imparted with the aid of electronic goods like computers and projectors, the interpretation could be different, the judgment observed. 

AAI can revise terms of tenders

The Delhi High Court (HC) last week dismissed the petition of Travel Food Services against the Airports Authority of India (AAI), challenging the change in the terms of tenders for setting up food & beverage outlets at 12 airports in the country. AAI had called for tenders, in which the firm stood a good chance of getting the deal. But, AAI later amended the terms and allowed several new contenders for the bid. This was challenged on the ground that fresh requests for the bids were allowed to benefit those who were either disqualified previously, or who had failed to submit their applications within time. Such bidders were clearly barred from participating further in the tender process. The HC rejected the arguments and said the decision of AAI appeared to be “a perfectly reasonable exercise of the discretion vested in it in law”. 

Two 'Turning Points' in litigation

Though ‘turning point’ is an English phrase signifying a point in time when a decisive change occurs in a person's life, those words could be considered as a trade mark if it is used by a coaching institute as its name for a long time. It is a distinctive trade mark deserving protection. The Delhi High Court (HC) stated so while passing an injunction in the judgment, Turning Point vs Turning Point Institute Private Ltd. The first party moved the HC, alleging the other institute used the words and attracted students, causing financial losses to it. It also asserted it was the first to adopt the name.  Moving a cross-petition, the institute also sought an injunction, alleging the other party has no right to use the title. The HC observed that on balance, the first party deserved protection. The judgment said the adoption of the name by the opposite party was dishonest and public interest demanded “stemming confusion among the innocent and gullible public, particularly young students looking to get trained for competitive examinations”.