The Supreme Court ruled, last week, that if a disputing party asks its rival to appoint an arbitrator according to their agreement and if it is not complied with, the former can approach a court for appointment of an arbitrator under the Arbitration and Conciliation Act. After that, the arbitrator appointed by the court will proceed with the arbitration. In this case, Dakshin Shelters Ltd vs Geeta Johari, disputes arose between the two parties who had signed a development agreement. Geeta Johari invoked the arbitration clause in the agreement and nominated a former judge of the Andhra Pradesh high court on behalf of her and called upon the firm to nominate its arbitrator. The firm raised objections to this request. She moved the high court, which appointed an arbitrator. This was opposed by the firm, leading to the appeal in the Supreme Court. The court dismissed the appeal stating that the firm’s right to appoint its arbitrator according to the agreement got extinguished once it failed to appoint an arbitrator after getting notice from the opposite party.
UP Power Corp loses to Railways
The Supreme Court has upheld the action of Railways which built its own transmission lines and drew power from NTPC generating stations as the tariff of Uttar Pradesh Electricity Board was excessive. The SEB had threatened to demolish the transmission lines set up by the railways. The Delhi High Court stayed the action. The SEB then moved the Allahabad high court against the railways’ move. Both cases were then transferred to the Supreme Court. It approved of the railways’ action in the case, UP Power Corporation vs Railway Board. The judgment pointed out that both NTPC and the railways had obtained permission from the concerned ministries prior to entering into this agreement. Therefore, constructing transmission lines, and drawing power from thermal power plants of NTPC was perfectly legal. Even under the Electricity Act, 2003, a direct sale of power by a generating company to a consumer is specifically permitted, the judgment emphasized.
Bail in economic fraud cases
Granting bail to a manager of Vishal Exports Overseas Ltd, the Supreme Court stated that when special courts are overburdened and there is no chance of speedy trial, prisoners awaiting trial should not be detained indefinitely as their right to life under Article 21 of the Constitution is violated. It cited the recent case of Sanjay Chandra in the telecom scam when his bail application was rejected by the special court and the Supreme Court granted him bail on strict conditions. In this case, Dipak Mehta vs CBI, the charges of economic offences were serious, and he was not granted regular bail for nearly two years, even by the Gujarat High Court. He is suffering from a series of life-threatening diseases. Therefore, following the Sanjay Chandra precedent, the court granted bail to this executive also.
Rap for slumbering babus
Government authorities sitting over lost cases and then praying for “condonation” of long delays were severely criticised by the Supreme Court last week in its judgment, Post Master General vs Living Media India Ltd. The case was about concessional postal rates for magazines where the Post Master had lost in the Delhi high court. The appeal was filed after a delay of 427 days. Dismissing the appeal on the ground of delay itself, the Supreme Court: “It is the right time to inform all the government bodies, their agencies and instrumentalities that unless they have reasonable and acceptable explanation for the delay and there was bona fide effort, there is no need to accept the usual explanation that the file was kept pending for several months/years due to considerable degree of procedural red-tape in the process.”
CCI probe against railway dominance
The Delhi High Court last week dismissed the appeal of the Railway Board against the ruling of the Competition Commission of India which had ordered an investigation by its director general on a complaint of abuse of its dominant position. It was alleged in a complaint before the commission that the railways had increased charges for various services, not provided access to infrastructure such as rail terminals and imposed several restrictions on other players in the field. The commission rejected the objection of the railways that it was not an 'enterprise' according to the definition in the Competition Act as it was conducting sovereign functions. On appeal, the high court also ruled that the railways were not exercising sovereign functions when it was involved in commercial activities like running trains. It could be done by private enterprises also. Therefore, the word enterprise covered railways and the competition law covered it.
Trade mark row over tissue paper
The Delhi high court last week passed injunction in favour of Premier Tissues India Ltd against Rolia Tissues Industries in a trade mark dispute over the name Premier. Premier Tissues alleged that the rival firm was using the mark ‘Premium’ in a way confusing customers. In its judgment, the high court said that the two sets of packaging with marks, Premier and Premium, are deceptively similar. “Prima facie, it is clear that it is a case of violation of vested rights of the plaintiff (Premier) and pirator thereof cannot become rightful owner in any manner.”
