Legislative and Regulatory Update
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In This Issue [No.178]
December 10, 2006
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Bar Council of India Vs. Board of Mang. Dayanand Coll. of law and Ors.
Respondent No. 5 was appointed as Principal of Law College even though he did not possess a qualification in law. Bar Council of India on inspection withdrew its recognition to said Law College on ground that appointment of Principal was against provisions of Advocates Act and Bar Council of India Rules. Thereafter, respondent No. 5 was transferred to another college. Respondent No. 5 then filed writ petitions challenging his transfer wherein High Court held that as per Uttar Pradesh State Universities Act, 1973 such an appointment could be made notwithstanding anything contained in Advocates Act, 1961 or in the Rules framed by the Bar Council of India. High Court proceeded on basis that there was a conflict between two enactments, namely, University Act and Advocates Act and in terms of Article 254(2) of Constitution of India, since University Act was a later enactment it would prevail over Advocates Act. Therefore, since appointment to post of a Principal of a College affiliated to a University was governed by University Act, appointment of respondent No. 5 as Principal of Law College was liable to be upheld. High Court also held that Bar Council of India did not have any control regarding legal education and therefore Bar Council of India could not make any prescription regarding legal education or about those who are to teach law, or who are to be Principal of a College of Law. Therefore, order transferring respondent No. 5 was consequently set aside. Hence, present appeal. Held, while adhering to its process of selection of a Principal, it behoves State to ensure that appointment it makes is also consistent with Advocates Act and rules framed by Bar Council of India. Further, held pith and substance of Advocates Act falls under Entries 77 and 78 of List I of Seventh Schedule, and therefore, it is not necessary to postulate a conflict of legislation in this case.
Indian Oil Corporation Ltd Vs. State of Assam and Ors
Appellant Company is a registered dealer under Assam General Sales Tax Act, 1993. It purchased petroleum products from “BRPL” on payment of sales tax as per Assam General Sales Tax Act, 1993 and sold it to customers. Pursuant to a Central Government Resolution, appellant company had to sell its products at prices fixed by Central Government which included surcharge to be collected from buyers and deposited to 'Oil Pool Account'. Senior Superindent of Taxes issued show cause notice on appellant company stating that it was liable to pay tax on sale of products purchased from BRPL. Revenue held that since "sale price" of appellant company is more than 40% of purchase price, as per Explanation to Section 8(1)(a) of Assam General Sales Tax Act, 1993 read with Rule 12 of Assam General Sales Tax Rules, 1993, second sale by appellant company was to be treated as first sale and therefore appellant company was liable to pay tax on whole second sale price. Appellant challenged aforesaid notice in a writ petition before High Court on ground that on purchase of goods from BRPL it had paid sales tax and as such sales tax would be leviable only on difference of price between purchase price and sale price; otherwise, it would amount to double taxation, and as difference amount accounted to less than 40% it was not liable to pay sales tax on whole amount of sale price. Learned Single Judge dismissed petition holding that amount of 'surcharge' collected by appellant company even though passed on to 'Oil Pool Account' had to be included in "sale price" as defined under Sub-section (34) of Section 2 of Act. On appeal, Division Bench of High Court dismissed writ appeal and held that 'surcharge' collected by appellant on behalf of Central Government and contributed to 'Oil Pool Account' was not statutory collection but was collected under executive instructions and cannot be excluded while calculating "sale price". It was held that sale by appellant company was to be treated as first sale within meaning of Section 8(1)(a) of Act read with Rule 12 of Rules since resale price exceeded 40% of purchase price. Hence, present appeal. Held, according to scheme of Act, sales tax would be leviable only on difference of resale price and purchase price since under Sub-section (1) of Section 8 of Act, tax is levied at first point sale. Therefore, directing appellant company to pay sales tax on entire amount resold would amount to double taxation.
Commissioner of Central Excise, Chandigarh V. Khanna Industries and Ors
Respondents-assessee, manufactures of Brass Sanitary Bathroom fittings falling under Sub-heading 8481.80 and 8481.99 of Schedule to Central Excise Tariff Act, 1985, were availing exemption available to small scale industries under Notification No.175/86-CE. Proceedings were started against respondents for demand of duty, as respondents had affixed brand name "ARK" in stylised script on their products which was brand name of another company engaged in trading of "brass sanitary fittings called M/s. Arkson Pvt. Ltd. Collector, Central Excise, denied exemption holding that respondents were affixing specified goods with brand name of another person and therefore, respondents were not eligible for grant of exemption. Additional Commissioner, confirmed demand of duty and imposed penalty on respondents holding that M/s. Arkson Pvt. Ltd. was not eligible for benefit of Notification No.l75/86-CE since it was not holding any L-4 licence and that it was M/s. Arkson Engg. Co, a proprietary concern of M/s. Arkson Pvt, Ltd, which manufactures C.I. castings who were exempted from payment of duty. Additional Commissioner further concluded that aggregate sale figure of M/s. Arkson Pvt. Ltd. was more than Rs. 2 crores during 1990-91 and 1991-92 and accordingly benefit of Notification was also not available to it. Respondents questioned correctness of said decision before Commissioner (Appeals) who set aside adjudication orders. Revenue preferred appeals before CEGAT which also endorsed view of Commissioner (Appeals). Hence, present appeal. Held, benefit of small scale exemption under Notification No.175/86-CE, as amended, is not available to specified goods if they are affixed with brand name or trade name of a trader who is not a manufacturer.
Karnataka
Hotel Leelaventure Limited Vs. Appejay Oxford Bookstores Pvt. Ltd
Petitioner and respondent entered into a license agreement as per which a part of the suit premises owned by the petitioner was taken over for use by the respondent for a specified period. Subsequently, after the completion of period stated in license agreement, petitioner addressed a letter calling upon the respondent to vacate the suit premises. When the respondents did not comply with the said demand, petitioner sent a notice to respondents invoking the Arbitration Clause of the Agreement and suggested the name of an Arbitrator to resolve the dispute. Respondent, instead of agreeing to the Arbitrator suggested by the petitioner or suggesting any other name, filed a petition under Section 11 of the Act before the Calcutta High Court for appointment of an Arbitrator. Subsequently, the petitioner filed the present petition for appointment of an arbitrator. Held, in view of clear language employed by Parliament in Section 11(11) of Act when once a request is made for appointment of an Arbitrator to different High Courts, it is the High Court to which such a request is made earlier in point of time which alone will have jurisdiction and the other Court will have no jurisdiction to entertain such a request, as long as the earlier petition for appointment of Arbitrator is pending in another Court. Therefore, as respondents have approached Calcutta High Court for same relief earlier in point of time and this petition having filed subsequent thereto, this petition is not maintainable.
G.M. Venkatappa Vs. Anjanappa & Gopalappa
Deceased father of petitioner had filed a suit in respect of suit premises and had been granted an injunction in favor of same. Upon death of first defendant, first respondent claimed to have inherited said property as legal representative of deceased first defendant. Thereafter, petitioner filed an execution petition praying to arrest and detain respondents in civil prison and also to give a direction to Police to enforce permanent injunction. When matter came up for consideration before Trial Court, Trial Court placed reliance on judgment of Apex Court in Yashpal Singh v. VIII Addl. District Jude and Ors wherein, it was held that execution petition can be filed as against party who was a party to suit and when party having obtained a decree, that party can alone file an execution petition and obtain a decree for injunction. Trial Court then dismissed execution petition without reference to law laid down by subsequent judgment of Apex Court in Muthukaruppa Pillai v. Ganesan. Hence present revision petition. Held, after careful reading of well settled principle laid down by Apex Court in case of Muthukaruppa Pillai v. Ganesan, that if remedy of injunction granted by decree is in respect of any heritable and partible right, it does not get extinguished with death of a party thereto, but it ensures to the benefit of legal heirs of decree-holder, as also such a decree could be executed against successor-in-interest of deceased judgment-debtor as well. Therefore, in light of ratio laid down by Supreme Court in case of Muthukarupa Pillai v. Ganesan including judgment of Division Bench of this Court in case of Ramachandra v. Laxmana Rao, impugned order passed by trial Court cannot be sustainable and is liable to be set-aside. Civil Revision petition is allowed.
Sri R. Narayanaswamy Reddy Vs. Sri R. Lakshminarayana Reddy & Ors
Appellant and his brothers were parties to a compromise agreement entered through a compromise petition before Apex Court in an earlier civil appeal relating to dispute over suit schedule property. As per the compromise agreement, partition of suit schedule property was done and appellant got his share of property in suit schedule property. Thereafter, a survey report revealed that said suit schedule property ‘S.No. 29/2A’ compromised of more land and therefore appellant filed present suit seeking his share in excess land. Trial Court, however, rejected contention of appellant and held that as per provisions of Order XXIII Rule 3(a) of CPC a compromise decree can be challenged by party to it by filing proceedings in that very case alone and it is not open for the party to file a suit. Hence, present appeal. Held, remedy for seeking necessary clarification lies in the very court where the compromise petition was filed and decree was passed in terms of it, and it is not open to the appellant to question the same before the trial court.
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