From computing damages to I-T appeals, here’re the key court orders | Business Standard Column

Clipped from: https://www.business-standard.com

In Uma Maheshwari vs United India Insurance Co, the court again raised the compensation reduced by the Karnataka High Court

The Supreme Court last week ruled that under the Bombay Tenancy Act such transfer is not allowed through a Will

Game of chance in computing damages

Judicial vagaries in computing compensation in road accidents give it an element of luck. This was the moral of three judgments delivered by the Supreme Court last fortnight. When Harish (35) died in an accident, the tribunal awarded his wife and two minor daughters Rs 12.55 lakh. He was running two taxis and earning Rs 1 lakh a year. But the insurance company appealed to the Uttarakhand High Court. It arbitrarily halved the amount ruling that Harish was a government servant, not a taxi driver. There was no evidence to conclude that. On appeal, the Supreme Court, in Sangita Arya vs Oriental Insurance, granted Rs 17.50 lakh, commenting that the high court order “bristled with serious factual errors and the entire basis of its judgment was misconceived”. The women had to fight 13 years to get a favourable judgment. In Uma Maheshwari vs United India Insurance Co, the court again raised the compensation reduced by the Karnataka High Court.

The tribunal had awarded Rs 58 lakh to the woman which was reduced by the high court. On appeal, the Supreme Court restored the tribunal order, stating the high court had ignored the claim on account of “future prospects”.

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Marine firms lose income tax appeals

Marine products export companies in Kerala lost income tax appeals when the Supreme Court dismissed them and ruled that they were not eligible to claim deductions for foreign exchange received for services provided to firms abroad. The exporters provided services to foreign buyers of frozen seafood and marine products. They claimed deduction under Section 80-O of the Income Tax Act. Though the tax appellate tribunal allowed it, the high court rejected the claim. It had ruled the assessees were merely procuring agents who had no claim for expertise capable of being used abroad, rather than in India. Therefore, the services rendered by them did not qualify as “services rendered from India”, for the purpose of Section 80-O. This view was upheld by theSupreme Court.

Curb on transfer of farmland through Will

Transfer of agricultural land for commercial purposes has been a controversial subject. The Supreme Court last week ruled that under the Bombay Tenancy Act such transfer is not allowed through a Will. Even otherwise, such transfer requires permission from an authorised officer. If such transfer is permitted through testamentary disposition, it would defeat the purpose of the Act, which applies to Gujarat. The court clarified the law in its judgment in Vinodchandra vs State of Gujarat. It dismissed a batch of appeals, which argued agricultural land could be transferred through a Will for non-agricultural purposes. The judgment pointed out when such transfer cannot be done by a person while alive, it could not be done through a Will. Though the bar is not fully consistent with the principles of the succession law, the objective of the Act is to sub-serve a higher purpose, the court said.

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