 "Tangle over withdrawal of incentives")
The Supreme Court has stated that if the interpretation of a notification on value-added tax leads to an absurdity, it should be avoided. The court stated so in its judgment, State of Jharkhand vs Tata Steel Ltd, where the company demanded benefits under the Jharkhand Value Added Tax Act. The company's unit was originally in Bihar but after the bifurcation of the state, it fell into the new state of Jharkhand. While the Bihar government had granted certain sales tax benefits as incentives for the company to invest in the state under the industrial policy, the Jharkhand government passed the VAT Act and notifications, which affected the benefits granted originally. It led to multiple litigation, mainly on the issue whether a dealer enjoying the benefit of tax exemption is allowed to convert the facility from payment of tax into the facility of deferment. The company sought 13 years for repayment from the time of grant of benefit. The court stated that "such interpretation not only causes serious violence to the language employed in the notification but if it is allowed to be understood in such a manner, it shall lead to an absurd situation." The court reduced the period to five years in the facts of the case.
Fresh auction for Meerut abattoir
The Supreme Court last week set aside the judgment of the Allahabad High Court and ordered a fresh auction for setting up a modern slaughter house in Meerut. The court in 2006 had emphasised the need for modernising slaughter houses. The UP government, therefore, issued policy guidelines and followed the private-public participation model for urban local bodies according to prescribed standards. The state called for tenders and one private firm out of two bidders was selected. Later, the finance department raised some procedural objections and, therefore, a fresh advertisement was issued. The selected firm moved the high court, which quashed the fresh bids. The state government and the corporation moved the Supreme Court. Allowing their appeal in the judgment, State of UP vs Al Faheem Meetex Ltd, the apex court stated that the corporation has discretion in accepting or rejecting bids, especially when there were only two bidders and more competitive offers were required. Moreover, the tender was made in 2010 and because of the passage of six years, it was all the more important to call for fresh bids.
A division bench of two judges of the Supreme Court has referred four issues relating to the Motor Vehicles Act to be decided by a larger bench in view of conflicting decisions of the court in the past. There was a batch of appeals led by the case, Mukund Dewangan vs Oriental Insurance Co, involving the definition of 'light motor vehicle' and whether it includes transport vehicles. The second question is whether 'transport vehicle' and 'Omnibus', the gross weight of which does not exceed 7,500 kg would be light motor vehicles. Another issue is whether, after the 1994 amendment to the Act, whether procedure to obtain driving licence for transport vehicles of the light motor vehicle variety has changed.
Vizag steel plant appeal dismissed
The Supreme Court has dismissed the appeal of Rashtriya Ispat Nigam Ltd ('Visakhapatnam Steel Plant') in its dispute with Prathysha Resources & Infra Ltd over the arbitration award. The steel plant floated a tender for transportation of goods to the port and the opposite party was the successful bidder. Disputes arose over rate of escalation and payment, which was referred to arbitration by a retired judge. His award in favour of the transport company was challenged by the steel plant. The district judge set aside the award. On appeal, the Andhra Pradesh high court approved of the award. The Supreme Court also upheld the award.
Meaning of 'grocery' extended
The term 'grocery' would include soft drinks and bottled water, not merely food items, the Supreme Court stated extending the meaning of the word grocery. This interpretation would benefit manual labourers in Maharashtra, as the court has dismissed the appeal, PepsiCo India Holding P Ltd vs Grocery Market & Shops Board, against the Bombay high court judgment. The loaders got only wages and were deprived of provident fund contribution, paid holidays, house rent, workmen's compensation, bonus and other medical benefits. It was to protect such workers that the welfare legislation titled Maharashtra Manual Workers Welfare Act and a scheme were introduced. When the authorities applied the law to PepsiCo, which produces soft drinks like Pepsi, Mirinda, 7 Up and mineral water, it objected to it and moved the Bombay high court. PepsiCo's argument was that the expression grocery would only comprise articles, which are required as daily necessities such as oil and grain in households, and not soft drinks. The high court dismissed the petition stating that "now-a-days, soft drinks are available in the grocery shops and supermarkets. They are items of food and, therefore, they are all grocery items. In all the manufacturing process, loading and unloading activities are carried out, which are the activities of the manual workers." The Supreme Court upheld this view to the benefit of manual workers.
Judgments must contain reasoning
The judgment of a court which decides an appeal for the first time must give reasons for its conclusion, the Supreme Court reiterated in the case, UP Transport Corporation vs Mamta. In this case, a youth died in a road accident. The family claimed compensation and the motor vehicle claims tribunal awarded her Rs 24.76 lakh. The corporation appealed to the Allahabad high court, arguing that the deceased person also contributed to the accident and the compensation amount was disproportionate. The high court dismissed the appeal with a cryptic order containing no reasons. The corporation appealed to the Supreme Court, arguing that under the Civil Procedure Code it was obligatory on the part of the high court to discuss and decide on the factual aspects argued. The Supreme Court accepted this contention and sent the case back to the high court to review the facts. The judgment emphasised that the factual aspects must be considered in the first appeal when the court passes its order; otherwise the courts hearing further appeals would not be able to decide the case fairly.
Fresh auction for Meerut abattoir
The Supreme Court last week set aside the judgment of the Allahabad High Court and ordered a fresh auction for setting up a modern slaughter house in Meerut. The court in 2006 had emphasised the need for modernising slaughter houses. The UP government, therefore, issued policy guidelines and followed the private-public participation model for urban local bodies according to prescribed standards. The state called for tenders and one private firm out of two bidders was selected. Later, the finance department raised some procedural objections and, therefore, a fresh advertisement was issued. The selected firm moved the high court, which quashed the fresh bids. The state government and the corporation moved the Supreme Court. Allowing their appeal in the judgment, State of UP vs Al Faheem Meetex Ltd, the apex court stated that the corporation has discretion in accepting or rejecting bids, especially when there were only two bidders and more competitive offers were required. Moreover, the tender was made in 2010 and because of the passage of six years, it was all the more important to call for fresh bids.
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Motor vehicle law for larger bench
A division bench of two judges of the Supreme Court has referred four issues relating to the Motor Vehicles Act to be decided by a larger bench in view of conflicting decisions of the court in the past. There was a batch of appeals led by the case, Mukund Dewangan vs Oriental Insurance Co, involving the definition of 'light motor vehicle' and whether it includes transport vehicles. The second question is whether 'transport vehicle' and 'Omnibus', the gross weight of which does not exceed 7,500 kg would be light motor vehicles. Another issue is whether, after the 1994 amendment to the Act, whether procedure to obtain driving licence for transport vehicles of the light motor vehicle variety has changed.
Vizag steel plant appeal dismissed
The Supreme Court has dismissed the appeal of Rashtriya Ispat Nigam Ltd ('Visakhapatnam Steel Plant') in its dispute with Prathysha Resources & Infra Ltd over the arbitration award. The steel plant floated a tender for transportation of goods to the port and the opposite party was the successful bidder. Disputes arose over rate of escalation and payment, which was referred to arbitration by a retired judge. His award in favour of the transport company was challenged by the steel plant. The district judge set aside the award. On appeal, the Andhra Pradesh high court approved of the award. The Supreme Court also upheld the award.
Meaning of 'grocery' extended
The term 'grocery' would include soft drinks and bottled water, not merely food items, the Supreme Court stated extending the meaning of the word grocery. This interpretation would benefit manual labourers in Maharashtra, as the court has dismissed the appeal, PepsiCo India Holding P Ltd vs Grocery Market & Shops Board, against the Bombay high court judgment. The loaders got only wages and were deprived of provident fund contribution, paid holidays, house rent, workmen's compensation, bonus and other medical benefits. It was to protect such workers that the welfare legislation titled Maharashtra Manual Workers Welfare Act and a scheme were introduced. When the authorities applied the law to PepsiCo, which produces soft drinks like Pepsi, Mirinda, 7 Up and mineral water, it objected to it and moved the Bombay high court. PepsiCo's argument was that the expression grocery would only comprise articles, which are required as daily necessities such as oil and grain in households, and not soft drinks. The high court dismissed the petition stating that "now-a-days, soft drinks are available in the grocery shops and supermarkets. They are items of food and, therefore, they are all grocery items. In all the manufacturing process, loading and unloading activities are carried out, which are the activities of the manual workers." The Supreme Court upheld this view to the benefit of manual workers.
Judgments must contain reasoning
The judgment of a court which decides an appeal for the first time must give reasons for its conclusion, the Supreme Court reiterated in the case, UP Transport Corporation vs Mamta. In this case, a youth died in a road accident. The family claimed compensation and the motor vehicle claims tribunal awarded her Rs 24.76 lakh. The corporation appealed to the Allahabad high court, arguing that the deceased person also contributed to the accident and the compensation amount was disproportionate. The high court dismissed the appeal with a cryptic order containing no reasons. The corporation appealed to the Supreme Court, arguing that under the Civil Procedure Code it was obligatory on the part of the high court to discuss and decide on the factual aspects argued. The Supreme Court accepted this contention and sent the case back to the high court to review the facts. The judgment emphasised that the factual aspects must be considered in the first appeal when the court passes its order; otherwise the courts hearing further appeals would not be able to decide the case fairly.