Iridium India's appeal dismissed

LEGAL DIGEST

The Supreme Court last week dismissed Iridium India Telecom Ltd's appeal against the US corporation Motorola Inc on a technical point and ruled that the Bombay High Court rules of procedure would prevail over the civil procedure code (CVC).

The Bombay High Court was hearing the suit of Iridium India claiming about Rs 1,000 crore on the ground that it had suffered loss or damage on account of an alleged fraud by the US corporation. It had obtained an ex parte order against the foreign firm in the nature of an attachment.

But the two companies were involved in procedural wrangles raising the question whether the high court rules regarding original suits will take precedence over the CPC. The high court held it would.

Therefore, the Indian firm moved the apex court. Upholding the high court view, it held that chartered high courts like that of Bombay had been given some freedom because of historical reasons and therefore, the CPC had left them untouched in some respects.

Singareni Collieries wins case

The Supreme Court last week dismissed a batch of appeals by small-scale units challenging higher price from them for C and D grade coal bought from government-owned Singareni Collieries Ltd (Pallavi Refractories & others vs Singareni Collieries case).

According to a price notification issued in 1997, non-core sector industries would be charged 20 per cent additional price over and above the notified prices. The units challenged this price increase as discriminative as the price for the core sector was not hiked.

They also argued that the substantial price variation in the guise of additional levy amounted to dual pricing, which was illegal, arbitrary and excessive. The government company submitted that price fixation was within its discretion, especially as coal was not a controlled commodity now.

Therefore, even dual pricing was within its power. Moreover, it has accumulated losses of more than Rs 1,000 crore and, therefore, it was justified in imposing additional costs after taking into consideration of the central government policy and the cost of production. The apex court accepted this contention and dismissed the appeals of the SSIs.

Orissa HC order overruled

The Supreme Court last week overruled the Orissa High Court and stated that an apprentice had no right for absorption in a company unless there was a term in the contract of apprenticeship, which entitled him to claim the right (Mahanadi Coalfields vs Sri Sadashib Behera case).

This was clear from the Apprenticeship Act and the Rules of 1991. "In the absence of any condition in the contract, which is entered into between the employer and the apprentice at the time of the commencement of his apprenticeship training and which is registered with the Apprenticeship Adviser to the effect that the apprentice shall serve the employer, an apprentice cannot claim any right to get an employment on the successful completion of his training," the Supreme Court clarified, while allowing the appeal of the company.

Ichalkaranji's appeal rejected

The Supreme Court has dismissed the appeal of Ichalkaranji Machine Centre, a small-scale manufacturer of gear boxes, against the order of the Cegat denying excise exemption under the modvat scheme. The unit had opted for the modvat scheme and availed of the facility under that.

But the authorities issued showcause notice to them for recovery of differential duty. When it was challenged in the Cegat, it ruled that the unit could not have taken modvat credit in the facts of the case. On appeal, the Supreme Court ruled that the unit was not entitled to clear the final products at concessional rate of duty.