When a law is amended, litigation which started earlier is usually caught midway between the old and the new provisions. Each contending party invokes the provision that is convenient to it. This starts another round of arguments which often reach the Supreme Court. One such dispute was decided last week in the case, Videocon International Ltd vs SEBI.
The Sebi Act was amended in 2002 to specify that the appeal from Securities Appellate Tribunal shall lie to the Supreme Court and not the high court. Also, the new provision stated that appeals can be moved only on questions of law and not on facts. Videocon was adversely affected by an order of the Bombay high court in its appeal from the tribunal.
Therefore, it appealed to the Supreme Court arguing that the high court had lost jurisdiction after the amendment. The high court rejected it and held the appeal of the board was maintainable. The Supreme Court dismissed the company's appeal stating that "a law which brought about a change in the forum would not affect pending actions, unless the intention to the contrary was clearly shown. Since the amending provision does not so envisage, it has to be concluded that the pending appeals would not be affected in any manner."
Moreover, the General Clauses Act also asserts that the amendment of a statute which is not retrospective in operation does not affect pending proceeding, except where the amending provision expressly or by necessary intendment provides otherwise."
Liquidator to pay tax on sale of assets
Official liquidator of a wound-up company has to act as a "dealer" and pay trade taxes in some cases, the Supreme Court ruled last week in an appeal from Kerala. In this case, Assistant Commissioner vs Hindustan Urban Infrastructure Ltd, the official liquidator (OL) was appointed by the high court after the Board for Industrial and Financial Reconstruction recommended the winding up of Premier Cable Ltd.
The OL invited tenders for sale of the assets of the company. Hindustan Urban firm was the successful bidder. Later a dispute arose over who would take the liability of sales tax and other levies on the sale of assets. The high court held that the OL could not be treated as a dealer and asked to pay the duties.
The revenue authorities appealed to the Supreme Court arguing that OL should be deemed to be a dealer under the Kerala law. The Supreme Court ruled that an OL acted on behalf of the company in liquidation and he is appointed by and under the control of the court while discharging his duties. Allowing the appeal, the court held that the OL must bear the tax burden as "a manager or receiver of the property".
More compensation with each appeal
The Supreme Court last week asked the insurance company to pay enhanced compensation of Rs 24.25 lakh for the death on the road of a young manager of HDFC Bank. The Motor Accident Claims Tribunal in Ratlam had awarded Rs 12 lakh, which was raised by Rs 2 lakh in the appeal to the Madhya Pradesh high court.
However, on further appeal in the case, Kanhsingh vs Tukaram, the Supreme Court ruled that both the courts below wrongly calculated the loss of income suffered by the parents, who filed the claim. They did not consider the house rent allowance, medical and other welfare benefits, apart from the prospects of rise in the career of the 27-year-old victim who could have served at least 35 years more. Further, the funeral expenses were raised from Rs 2,000 to Rs 25,000 and the compensation under the head "loss of love and affection" was raised from Rs 30,000 to Rs 1 lakh.
Thumbs up for workers
At a time when there are allegations that labour law is being diluted, the Supreme Court has asserted that the welfare laws in line with the Directive Principles of State Policy must be interpreted in a liberal way. In two judgments last week, this aspect was discussed. In the case, Jasmer Singh vs State of Haryana, a worker who was employed for more than 240 days was dismissed without notice and denied retrenchment compensation.
He moved the labour court which ordered his reinstatement with continuity and back wages. The high court set aside the appeal of the state government. The worker appealed to the Supreme Court. It restored the order of the labour court. In the second case, KVS Ram vs Bangalore Metropolitan Transport, an employee was dismissed for misdemeanor after holding inquiry for 12 years.
The labour court ordered the management to reinstate him with continuity of service. The Karnataka high court set aside the order. But the Supreme Court allowed the appeal of the worker and restored the order of the labour court. In both judgments, it emphasized that social and economic justice is a "living concept of revolutionary import in a welfare state."
Hybrid seeds firms lose IPR case
The Delhi High Court has dismissed a batch of writ petitions moved by hybrid seed companies which had challenged a 2012 order passed by the Registrar, Protection of Plant Varieties and Farmers' Rights Authority holding that parent lines of known hybrid varieties could not be registered as "new" plant varieties under the Protection of Plant Varieties and Farmers' Rights Act.
The authority had held that if the hybrid falls under the category of extant variety about which there is common knowledge then its parental lines cannot be treated as novel. Five companies, namely Bayer Bioscience Ltd, Monsato Holdings Ltd, Sungro Seeds Ltd, Maharashtra Hybrid Seed Ltd and DCM Shriram Consolidated Ltd had argued that the hybrid seeds, obtained from crossing the parental lines, are distinct in traits and characteristics from the parent lines and could not be considered as propagating or harvested material of the parental line varieties.
The judgment stated that Section 15(3) of the Act would indicate that if the seeds of parent lines have been commercially sold, the breeders cannot claim the parent lines to be novel. The legislative intent of the Act is to protect the intellectual property rights of the farmers' and plant breeders as India had ratified the TRIPS agreement.
