The time limit for moving an appeal to the debt recovery tribunal is different from the period set in the Limitation Act, because the Recovery of Debts and Bankruptcy (RDB) Act is a special law and the rules set by it should be followed, the Supreme Court stated while dismissing two appeals in the case, International Asset Reconstruction Co vs Official Liquidator of Aldrich Pharma and others. The RDB Act allows only 30 days while the Limitation Act condones a delay of 45 days and more, if sufficient reasons are given.
The judgment stated that the RDB Act was enacted to facilitate and expedite recovery of debts due to banks and financial institutions by summary proceedings before a statutory tribunal. Moreover, a tribunal is not a court though it has the trappings of a court. It is not limited by the rules of the Code of Civil Procedure and can devise its own procedure. The court asserted the same view while dismissing another appeal case, Iridium India Telecom Ltd vs Doha Bank QSC.
SC hikes land compensation
The Supreme Court (SC) has enhanced the compensation for some 300 landowners in Haryana who will now get Rs 45 lakh and Rs 35 lakh per acre instead of Rs 33 lakh and Rs 18 lakh decided by the land acquisition officer. The land was taken over in 2007 under the old Land Acquisition Act. In this case, Bijender vs State of Haryana, the court applied the belting system in which the land abutting the road was given the highest value and the plots behind were awarded proportionately less. The sale deeds of adjacent lands were examined to determine the correct market value of the land taken over. Adopting the various criteria to arrive at the fair price, the SC allowed the appeal of the landowners for higher compensation.
Compensation for misuse of trademark
The Delhi High Court last week imposed Rs 10 lakh as compensation for violation of trademark in the case, Orient Ceramics & Industries Ltd vs Square Ceramic Ltd. Justifying the action, the judgment stated that the conduct of Square Ceramics was “deplorable” and indicated “a tendency to indulge in illegal activities and to obtain wrongful advantage”. The trademark in dispute was ‘Orient’ for ceramic and vitrified tiles sold throughout the country.
The rival firm incorporated in Gujarat used the name ‘Oriento’ for the same products such as tiles which was allegedly similar to that of Orient Ceramics. The court said that the play of words and the design and colours used in publicity materials would mislead consumers. The Gujarat firm had stood away from the litigation, but it couldn’t take advantage of its absence to avoid the punishment, the court said.
Suit not barred if mediation skipped
Even if a contract urges parties to go in for mediation and conciliation before taking other legal steps, it would not stand in the way of filing a suit by the aggrieved party, the Delhi High Court stated last week in its judgment, HCL Learning Ltd vs Oriental Fairfield School. The trial court had dismissed the suit of HCL because the agreement contained a clause that stated that in case of a dispute, the parties shall endeavour to settle such disputes amicably within 15 days. It was not done. The high court stated that failure to take recourse to mediation would not render the party’s right to move a suit in a civil court or go in for arbitration. Such a clause is not mandatory and a pre-condition, and the aggrieved party has a choice to bypass the mediation route, the court said.
Mauritius sports firm wins tax case
The Delhi High Court last week quashed all income tax notices issued to ESS Distribution (Mauritius) Compagnie, a partnership firm established under the laws of Mauritius by ESPN Mauritius Limited. It is engaged in the business of distribution of sports-related TV programmes broadcast by ESPN Star Sports, Singapore. Since ESS Distribution is a tax resident of Mauritius, it claimed protection under the India-Mauritius Double Taxation Avoidance Agreement. Its case was that its revenue from distribution being business, profit was not taxable in India, in the absence of it having a ‘Permanent Establishment’ in the country. But, the assessing officer held against it. On appeal, the Dispute Resolution Panel accepted the firm’s view.
The assessing officer ignored that ruling and described it as "grossly illegal, against the intent of the legislature and not in accordance with the provisions of the Act". The litigation continued for long, and ultimately the high court accepted the firm’s view and allowed its writ petitions.
ICICI Bank to pay for lapse in SMS alerts
The National Consumer Commission has directed ICICI Bank to pay compensation to Karan Singh who did not get SMS alerts while his savings account was being pilfered by unknown persons. He had over Rs 2 lakh in the account the last time he used the ATM card. But when he used the card again after three months, the account had only Rs 203. The bank defended itself, arguing that the card and the PIN were only with Singh, and therefore it was not responsible. The Haryana state commission rejected this plea stating that the SMS alert service was not used to inform of the debits. It asked the bank to refund the losses and pay compensation with interest. That decision was upheld by the National Commission.