From trial for worker's death to arbitration pact, here're key court orders

Adjudication essential to arbitration
 

In arbitration, the main elements are enquiry, hearing of parties, examination of evidence and adjudication of the dispute. A mere provision for appeal against the decision of an authority does not constitute an arbitration agreement, the Supreme Court stated while setting aside the order of the Delhi High Court appointing an arbitrator in the case, South Delhi Municipal Corporation vs SMS Tollways Ltd. In this case, the toll firm and the corporation disputed over building a national highway. The terms of the agreement stated that differences will be decided first by a competent officer of the corporation and the appeal will be resolved by the commissioner. The toll firm lost at the first stage and invoked arbitration. The high court saw an arbitration clause in the agreement. But on appeal by the corporation, the Supreme Court stated that the decision of the commissioner did not leave any scope for arbitration. The commissioner was empowered to settle the issues and there was no scope for adjudication between him and the contractor. It was in the nature of a departmental appeal found in the department rules, said the Supreme Court while allowing the appeal of the corporation.

When old is not gold
 

Four generations ago, a person failed to declare gold in his possession under the Gold Control Act 1968. He was imposed fine and threatened with other measures. His appeal, and after his death, appeals of his successors were dismissed by the Delhi High Court in 1972.  The granddaughter who pursued the case also died and her legal representatives carried their appeals to the Supreme Court. In 1972, the court passed an interim order staying all proceedings against the successors. While the stay continued, the Gold Control Act was repealed. The repealing Act of 1990 admitted the failure of the gold control scheme and called it “regressive” in the ‘statement of objectives’.  Goldsmiths and artisans had committed suicide during that period. However, the prosecutors have not released their grip on the accused persons. The Supreme Court has just decided half of the appeals moved by the legal representatives dealing with the effect of repealing the disastrous law. The successors have won in the Supreme Court. But it has referred another set of questions in the same case, Sushila Rungta vs Income Tax Recovery Officer, to be decided by the Delhi High Court.

Employees have right to quit job

An employee has a right to resign from his job and he cannot be forced to serve, in case he/she is not willing to stay on. He/She can be stopped from going away only if there is some rule or terms in the contract of appointment which prevents his/her exit or if some disciplinary proceeding is pending or contemplated which is sought to be avoided by resigning from the services.  The Supreme Court stated so while setting aside the judgment of the Bombay High Court in the appeal, Sanjay Jain vs National Aviation Company of India.  He was employed as a maintenance engineer in Air India. He resigned after the five-year term and served 30-day notice according to the rules and joined Jet Airways. When he claimed his dues like unpaid wages and provident fund, the employer denied them maintaining that his resignation has not been accepted. He moved the high court which dismissed his writ petition on the ground that acceptance of resignation was necessary. His appeal was allowed by the Supreme Court, which ordered the company to clear all his dues.

Cement firm to pay betterment charge
 

The Supreme Court, while setting aside the judgment of the Karnataka High Court last week, directed Birla Super Bulk Terminal to pay over Rs 14.8 million to the Bangalore International Airport Area Planning Authority with interest at the rate of 6 per cent from 1998. The company, which is a unit of Ultra Tech Cement Ltd,  had contested the demand of the authority for betterment charges, road cess and other charges for development activities in the industrial area. The government had acquired several villages for development of the airport area.  The Birla firm invoked the Town and Country Planning Act and the Industrial Area Development  Act of Karnataka to deny liability for additional charges. According to it, the Airport Area Planning Authority has no power to demand betterment charges. However, the Supreme Court rejected its contention. It also pointed out that other firms like ITC Ltd had complied with the demand for obtaining the sanction of their plans. “When other allottees of industrial plots have paid betterment charges and road cess for obtaining the sanction of the plan, the Birla firm cannot challenge the levy,” the judgment observed.

Penalty for flouting settlement terms
 

The Delhi High Court last week imposed a fine of Rs 500,000 on G M Pens International for violating its undertaking not to use certain brand names claimed by Luxembourg Brands SARL. The foreign brand owner of Reynolds pens accused the Indian firm of passing off its products, especially one writing instrument called Teramax. The two companies had earlier had a licence agreement but it was terminated by the Indian company. Disputes arose over certain brand names and there was a settlement in the court in 2016. However, the Indian company was accused of passing off Teramax, one of 36 brands, violating the undertaking. On this complaint, the High Court stated that the company and its two executive directors “are plainly guilty of violating the orders passed by this court inasmuch as they have continued to manufacture and sell the writing instruments under the trademark Termax". The penalty will be paid to Luxembourg within a month.

Trial for building worker’s death
 

A worker who was painting the exterior of the 18th floor of a building under construction in Delhi fell and died. The land was owned by real estate firm DLF Universal and the contracting firm was Larsen & Toubro. Several executives of both companies were arrayed as guilty under the Building Construction Workers (Regulation of Employment and Conditions of Service) Act, which creates corporate criminal liability against those who are in charge of, and is responsible to, the company for the conduct of its business, as well as the company.  The executives of both companies moved the high court for quashing the complaints against them. The high court quashed charges against the executives of DLF, but in its judgment in the case, S N Subrahmanyam vs NCT of Delhi, the high court asked two executives of the construction company to stand trial.