Govt tenders stalled by litigation: SC
The higher judiciary usually does not examine the terms of tenders, especially in writ petitions challenging them, as they are commercial documents. But since the government and public sector enterprises venture into economic activities, the Supreme Court has built certain checks and balances to ensure fairness in the procedure as required by the Constitution. It thus scrutinises tenders in writ petitions in rare cases. Now the Supreme Court feels that “the window has been opened too wide as almost every small or big tender is now sought to be challenged in writ proceedings almost as a matter of routine”. This observation was made by the court in its judgment last week in Caretel Infotech Ltd vs HPCL. The consequence of this trend is that it affected the efficiency of commercial activities of the public sector units, which may be in competition with those in the private sector. “An unnecessary, close scrutiny of minute details makes awarding of government contracts a cumbersome exercise, with long drawn out litigation at the threshold. The private sector is competing often in the same field. Promptness and efficiency levels in private contracts, thus, often tend to make the tenders of the public sector a non-competitive exercise. This works to a great disadvantage to the government and the public sector,” the court observed.
Triumph of charity above excise duty
If a manufacturer collects money for charitable purposes and the buyer pays it voluntarily, it would not be part of the transaction value of the sale of goods. The payment may have been shown in the invoice along with the price of goods, but the payment, usually called Dharmada, should not automatically be added to the excise duty, the Supreme Court ruled last week in two judgments. There were differences among various adjudicating authorities down below and even among Supreme Court judges. So the matter had been referred to a larger bench. The Dharmada charity was collected by JSW Steel Ltd while selling pig iron. M/S D J Malpani collected Dharmada in the sale of chewing tobacco. The companies have been fighting their cases for more than a decade with varying results. In the JSW case, the revenue authorities lost their claim. In the other case, the manufacturer lost its argument. The Supreme Court trawled various past judgments and gave a definitive answer in these two decisions. The court clarified that Dharmada was collected on the occasion of the purchase. That would not make it consideration for the transaction, defined in commercial laws.
Looking for ‘substantial question of law’
The Supreme Court last week found fault with the Delhi High Court for dismissing the appeal of the Income tax department at the threshold itself, with the high court observing that it did not raise “any substantial question of law”. According to Section 260-A of the Income Tax Act, the high court can hear appeals against the ruling of the tax tribunals if they raise important issues. In this case of the assessment year 1999-2000, between CIT and Nokia India, the telecom company objected to the notice issued to it by the assessing officer arguing that it was based on “change of opinion”. The appellate tribunal agreed with it, and the high court dismissed the appeal of the department in a short order. The Supreme Court found that there were, in fact, four “substantial questions” involved. It drafted them and returned the case to the high court for reconsideration.
Bachelor’s age matters in damages
When a bachelor dies in a road accident, the computation of compensation for the death by the motor accident compensation tribunal should be based on his age, and not that of his dependents, the Supreme Court ruled in its judgment last week in Royal Sundaram Alliance Insurance Company Ltd vs Mandala Yadagari Goud. The insurance company had argued that the age of the dependents should be the criterion, but it was rejected. Dismissing the appeals of the insurance company in a few cases against the ruling of the Karnataka High Court, the Supreme Court asserted that “the focus for determination of such claim is deceased and what would be his contribution towards the dependents would he to be alive, for the benefits of the dependents. In case the deceased is a married person, it is the age of the deceased which is to be taken into account. The question is whether in case the deceased is a bachelor, a different principle for calculation of the multiplier should be applied by shifting the focus to the age of the claimants?
We are of the view that the answer to this question should be in the negative”.
Rules to block rogue websites
The Delhi High Court last week raised seven questions on piracy on the internet, including how the courts could deal with the ‘hydra-headed’, ‘rogue websites‘ which, on being blocked, actually multiply and resurface as redirect or mirror or alphanumeric websites. The long discussion was made in eight suits filed by UTV Software Communications against as many websites alleging that they had been communicating to the public its original content/cinematographic works without authorisation. Allowing the plea, the court passed injunctions against the offending websites not to copy and distribute the contents belonging to UTV. Further, the court also issued a decree directing ISPs to block access to those websites. The DoT and the Ministry of Information Technology were directed to issue a notification calling upon ISPs to block access to those websites. The court also requested them to explore the possibility of framing a policy under which a warning is issued to the viewers of the infringing content.
AI to pay for deficiency in service
The National Consumer Commission has imposed a compensation of Rs 5 lakh on Air India on the complaint of a senior citizen couple travelling to the US. Though they were allotted seats in the middle of the aircraft from Kolkata to Chicago via Delhi, they were compelled to sit in the tail end, resulting in their suffering due to turbulence. The woman was reported sick after the flight. Air India argued that allotment of specific seats did not mean their confirmation and the change was blamed on technical faults. The commission rejected both contentions. On the complaint that the ailing woman was not provided with a wheelchair though the distance from the domestic to the international terminal in Delhi was substantial, the government-owned airline pleaded that there were not enough wheelchairs. That excuse was also rejected. The airline gave only an apology to the couple. However, the commission asserted that was not enough.
via Excise duty to rules for blocking rogue websites, here’re key court orders | Business Standard News