Even if the contract which contained an arbitration clause expired by efflux of time, the arbitration itself will not come to an end, the Supreme Court said, while appointing retired Justice N K Sodhi as the sole arbitrator in a dispute between Lufthansa German Airlines and the Airport Authority of India. The agreement had expired in March 2007. The dispute started during the subsistence of the contract and spilled over to later years. The airport authority failed to appoint its arbitrator. Therefore, the airlines moved the court. It stated that the dispute over damage to cargo was arbitrable and appointed the arbitrator.
Heinz loses case over market fee
The Supreme Court last week dismissed with costs appeals of Heinz India Ltd and Glaxo India Ltd challenging the order passed by the Director, Rajya Krishi Utpadan Mandi Parishad, Lucknow, demanding market fee for ghee produced in their Aligarh unit. The factory produced milk and energy beverages like Complan. Ghee was a byproduct. The dispute was whether ghee produced and taken out from the unit was stock transfer or sale. According to the Uttar Pradesh Krishi Utpadan Mandi Adhiniyam, the burden to prove that it was stock transfer was on the manufacturer. The authorities maintained that the firms had not produced evidence to show that it was stock transfer. When the firms approached the Allahabad high court challenging the adverse decision, it dismissed their writ petitions. The Supreme Court upheld the high court view and the action of the authorities, as the firms had failed to establish that no sale of the stocks of ghee had taken place within the Mandi limits at Aligarh.
Quashing trial in economic offences
The power of a high court to quash investigation must exercised “sparingly, carefully and cautiously, to do real and substantial justice for which alone the court exists. The inherent jurisdiction does not confer an arbitrary power on the high court to act according to whim or caprice. The power exists to prevent abuse of authority and not to produce injustice.” The court stated so while setting aside the order of the Orissa high court quashing investigations initiated by the vigilance department of the state government into the allegations of irregularities in the receipt of excess quota, recycling of rice and distress sale of paddy by M/s Haldipada Rice Mill. Allowing the appeal of the government in the case, State of Orissa vs Ujjal Kumar, the Supreme Court stated that “any kind of hindrance or obstruction of the process of law from taking its normal course, without any supervening circumstances, in a casual manner, merely on the whims and fancy of the court tantamounts to miscarriage of justice, which seems to be the case here.”
Expert view in customs cases important
The Supreme Court has observed that “in a fiscal or taxation law, while ascertaining the scope or expressions used in a particular entry, the opinion of the expert in the field of trade, who deals in those goods should not be ignored; rather it should be given due importance.” The court stated so while dismissing the appeal of the Commissioner of Customs (Imports) against the ruling of the Customs, Excise and Service Tax Appellate Tribunal, Mumbai, in a case involving M/s Konkan Synthetic Fibres. The tribunal found that the firm was eligible for exemption for its import of High Speed Draw Warping Machine. It accepted the view of the textile commissioner, who is well conversant with these machines. When there is no statutory definition of a particular machinery, the opinion of experts should be accepted by the revenue authorities, the judgment said.
Transmission towers allowed
A division bench of the Bombay High Court last week dismissed a batch of petitions by Wardha land owners whose land have been used by the State Electricity Transmission Commission for erecting towers. Their main contention was that the entire scheme of the Electricity Act, 2003 and the Indian Telegraph Act, 1885, which provided for laying of electric lines was unconstitutional being violative of Article 14 of the Constitution because they did not provide for a hearing to the land owners before the route, over which the electric line was to pass, was decided. According to them, even at the planning stage the government must hear the land owners on the route of the proposed electric line.
Coal India petition dismissed
The Calcutta high court last week dismissed the petition of Coal India Ltd against Canadian Commercial Corporation in an arbitration dispute over the law applicable to the parties. The high court upheld the preliminary objection of the Canadian government company to the authority of any Indian court to hear a challenge to an award passed in a reference conducted beyond the territorial limits of India. In this case, the arbitral tribunal held its meetings in England but recognised that the seat of the arbitration was Switzerland.
