SUPREME COURT

• INDIRECT TAXATION

Customs

Automotive Tyre Manufacturers Association Vs. The Designated Authority and Ors. (Decided on 07.01.2011) MANU/SC/0022/2011

Anti-dumping duty on imports of NTCF from China - After due investigations, the DA recommended imposition of provisional anti-dumping duty - Investigation challenged on the ground of being in violation of the principles of natural justice

Held, unless a statutory provision, either specifically or by necessary implication excludes the application of principles of natural justice, the requirement of giving reasonable opportunity of being heard before an order is made, is generally read into the provisions of a statute, particularly when the order has adverse civil consequences which obviously cover infraction of property, personal rights and material deprivations for the party affected. The principle holds good irrespective of whether the power conferred on a statutory body or Tribunal is administrative or quasi-judicial. While determining the existence, degree and effect of the alleged dumping, the DA determines a `lis' between persons supporting the levy of duty and those opposing the said levy. Therefore, the DA exercises quasi-judicial functions and is bound to act judicially.

• DIRECT TAXATION

Income Tax

Jt. C.I.T., Mumbai Vs. Rolta India Ltd. (Decided on 07.01.2011) MANU/SC/0024/2011

Tax on book profit - Section 115JA of the Income Tax Act, 1961 - Whether interest under Section 234B can be charged on the tax calculated on book profits under Section 115JA

Held, amendments have been made in the relevant Finance Acts providing for payment of advance tax under Sections 115JA and 115JB. Section 115JB is a self-contained code and thus, all companies were liable for payment of advance tax under Section 115JB and consequently provisions of Sections 234B and 234C imposing interest on default in payment of advance tax were also applicable. Thus, interest under Sections 234B and 234C shall be payable on failure to pay advance tax in respect of tax payable under Section 115JA/115JB.

• CRIMINAL LAWS

Laxmichand @ Balbutya vs State of Maharashtra Decided On 06.01.2011 (MANU/SC/0017/2011)

Appeal againstConviction - Charges framed against under Section 302 of the Indian Penal Code, 1860 - Whether instead of convicting the accused for culpable homicide amounting to murder, his case would fall in the category of culpable homicide not amounting to murder

Held, considering all the aspects, particularly, the conduct of the deceased, the accused had no intention to kill the deceased. It is true that blow given by the accused on the deceased was at the vital part because of which he was unconscious for seven days and ultimately succumbed to his injuries. However, the accused had no intention to commit the offence. Therefore, commission of offence attributed to the accused-Appellant would come under Section 304 Part II Indian Penal Code.

• MOTOR VEHICLE LAWS

Pushpa Vs. Shakuntala (Decided on 12.01.2011) MANU/SC/0032/2011

Liability to pay the compensation - Purchaser of the vehicle alone or that of the recorded owner of the vehicle - Determination thereof - Whether liability coextensive and from the recorded owner it would pass on to the insurer of the vehicle

Held, it is undeniable that notwithstanding the sale of the vehicle neither the transferor nor the transferee took any step for the change of the name of the owner in the certificate of registration of the vehicle. Therefore the transferor must be deemed to continue as the owner of the vehicle for the purposes of the Act, even though under the civil law he ceased to be its owner after its sale. Thus, even though in law there would be a transfer of ownership of the vehicle, that, by itself, would not absolve the party, in whose name the vehicle stands in records, from liability to a third person. Merely because the vehicle was transferred does not mean that the insurer stands absolved of his liability to a third person. Therefore allowing the appeal the insurance company was made liable to pay the compensation amount.

• LAND ACQUISITION LAWS

Karnataka Housing Board Vs. Land Acquisition Officer (Decide on 04.01.2011) MANU/SC/0027/2011

Determination of compensation for the acquired lands - Fair Market value - Auction sales do not furnish a safe guide for determination of market value with reference to the open market sale of comparable land - An element of competition enters into the auction - Price hikes - Auction sale by financial institutions, courts has an element of distress lowering the price - Likelihood of auction price being either higher or lower than the real market price - Unsafe guides for determining the market value.

Held, where an open auction sale is the only comparable sale transaction available the court may have to, with caution, rely upon the price disclosed by such auction sales, by providing an appropriate deduction or cut to off-set the competitive-hike in value. The general rule that the highest of the comparable sales should be relied upon will not apply, where the sale transactions relied upon are auction sales. Moreover evidence shows that the acquired lands were situated within the municipal limits, within a distance of Railway Station and the bus stand; and that there were several residential colonies and colleges in the surrounding areas. Therefore though the lands were agricultural, they could be classified as lands having urban development potential. Therefore compensation for land acquired must be based on fair market value avoiding auction prices and having regard to the partial access to infrastructural facilities the Court accordingly allowed the appeals in part and reduced the compensation awarded.

Girnar Traders Vs. State of Maharashtra & Ors. (Decided on11.01.2011) MANU/SC/0029/2011

Acquisition of Land - Interpretation and applicability of the Maharashtra Regional and Town Planning Act, 1966 and Section 11A of Land Acquisition Act 1894

Held, where the Legislature has used such words in the Act which if generally construed leads to palpable injustice, then the Court will endeavour to limit the usage of such words and the construction which is consistent with the smooth working of the system should be chosen. On reading Section 127, we have to take note of the fact that the authority under the MRTP Act can only make an application for acquisition under the Land Acquisition Act and nothing more. When Section 127 of the MRTP Act says that if within six months from the date of the service of such notice, the land is not acquired or no steps as aforesaid are commenced for its acquisition the reservation shall be deemed to lapse. High court committed an error when it held that the steps taken by the corporation would constitute steps required under Section 126(1)(c) of the Maharashtra Regional and Town Planning Act, 1996. Thus Appellants are entitled to relief claimed and the impugned judgment of the Bombay High Court is set aside.

• INDIRECT TAXATION

Excise

P.C. Paulose, Sparkway Enterprises Vs. Commissioner of Central Excise and Customs (Decided on 13.01.2011) MANU/SC/0040/2011

Liability for payment of service tax by a licencee - Service limited to collecting of fees on behalf of the Airport Authority of India - Section 65 of Finance Act, 1994

Held, whether or not the Appellant is a service provider and, therefore, liable to pay the service tax rest on the interpretation of Section 65 of Finance Act, 1994. Moreover licence agreement clearly stipulates that AAI is entitled in law to grant licence for the purpose of airport admission so as to provide amenities and facilities to passengers and that the licensee, has agreed under the licence agreement to render such services to AAI under certain terms. One of such stipulations was that the licensee would pay all rates, assessment, out goings and other taxes as leviable on the licensee in laws. Section 65 Clause 105(zzm) of Finance Act, 1994 defines `taxable service' to mean any person, by airports authority or any person authorised by it, in an airport or a civil enclave. It is thus crystal clear that the Appellant being a person authorized by AAI to provide service becomes liable to pay such tax. Consequently, the appeal is dismissed without any order.

HIGH COURT

• ARBITRATION LAWS

Penn Racquet Sports Vs. Mayor International Limited (Decided on 11.01.2011)

Enforcement of Foreign Arbitration Award - Challenged under Section 34 of the Arbitration and Conciliation Act, 1996 - Scope of enquiry by Court - Scope of setting aside the award due to patent illegality - Scope of public policy of India - Interpretation of Section 48 of the Arbitration and Conciliation Act, 1996 - Counter claim and costs under the ICC Rules

Held, there was no merit in the objections raised by the judgment debtor under section 48 of the Act, and consequently is liable to be dismissed making the foreign award in question enforceable under Chapter I Part II of the Act. Since the Court is dealing with a foreign award, and the agreement of the parties was that the agreement would be governed by the Austrian law. Consequently, the interpretation of the contract cannot be done by application of Indian law and the endeavour of the judgment debtor has been to interpret the contractual clause in question by application of the Indian law, which is not permissible. The phrase, ''public policy in India", implies that the award should not be contrary to the fundamental policy of Indian law or justice. Furthermore the High Court also observed that the award would not be rendered contrary to the interests of India or justice merely on the grounds that such an award has been passed against an Indian entity.

• FAMILY LAWS

Calcutta High Court

Smt. Mithu Das vs. The State of West Bengal & Ors. (Decided on 11.01.2011) MANU/RH/0214/1994

Release of Pensionary benefit of the deceased husband - Deceased during his life-time married twice - Second marriage not annulled by a decree of divorce - Whether Petitioner being a second wife where the first marriage still subsisting entitled to any benefits

Held, no dispute that the marriage between the Petitioner and her husband was not legal as the first marriage was still subsisting but there cannot be any denial of the benefits to the children borne of the wedlock which was not legal, even an illegitimate child has a right over the assets/properties of his father. The authorities therefore cannot deny at least the children of the Petitioner to claim the benefits, which they are entitled and accordingly directed to consider and dispose of the relevant representation upon giving an opportunity of hearing to all the interested parties in accordance with law

• CRIMINAL LAWS

Punjab and Haryana High Court

Sukhdev Singh alias Babbu Vs. State of Punjab (Decided on 14.01.2011) MANU/PH/0042/2011

Release on probation - Sentence was directed under Sections 384, 506 of the Indian Penal Code, 1860 and 25 of the Arms Act, 1959 - It was contended that Petitioner was the first time offender with no other criminal case pending against him

Held, the sword of damocles was not to hangover the head of the Petitioner for all times to come, he has suffered mental agony due to registration of this criminal case against him and also have already undergone for about two months in the case - In view of the facts and circumstances of the case, Petitioner directed to be released on probation on furnishing of probation bond before the learned Trial Court for one year

Himachal Pradesh High Court

Vikram Singh alias Viku Vs. State of Himachal Pradesh (Decided on 14.01.2011) MANU/HP/0004/2011

Application for release on Bail - FIR registered under Sections 376, 506 and 34 of the Indian Penal Code, 1860 - False implication pleaded - Prosecutrix below 16 years of age at the time of occurrence - Petitioner had earlier filed two bail applications though relief was not granted - No change in circumstances

Held, Petitioner has filed two bail applications earlier, first bail application was dismissed and he withdrew the second application. There is no change of circumstance since than and moreover after the dismissal of second application, charge has been framed and now the case has been fixed for prosecution evidence. The Petitioner since involved in a serious case alongwith other co-accused, not entitled to bail at this stage, accordingly, the application dismissed.

• SERVICE LAWS

Allahabad High Court

Vijay Kumar Singh Vs. State of U.P. and Ors. (Decided on 13.01.2011) MANU/UP/0043/2011

Compassionate appointment - Post of Sub-Inspector under the U.P. Recruitment of Dependant of Government Servants Dying in Harness Rule, 1974 - Denial on the ground of relevant Government Orders prohibiting compassionate appointment

Held, 1974 Rules provides for compassionate appointment to a person against a post available for direct recruitment in class III and Class IV post. In order to deny Petitioners' claim in accordance with 1974 Rules as they stand as on date, unless there is an amendment in the rules, the Respondents cannot proceed only on the proposal. Direction passed to consider the Petitioners for appointment on compassionate basis in accordance with law ignoring the questioned resolution of Recruitment Board, expeditiously without any further delay.

Even though the Petitioner may have been appointed on the post of Constable on compassionate grounds, yet when the two Government Orders which had been made the basis for denying them appointment to them on compassionate grounds on the post of Sub-Inspector, has been set aside it was held to be appropriate to issue a direction to the Respondents to consider the Petitioner for appointment on the post of Sub-Inspector taking into consideration the physical and educational qualifications.

• MOTOR VEHICLE LAWS

Rajasthan High Court

ICICI Lombard General Insurance Co. Ltd. Vs. Sukan Das and Ors. (Decided on 12.01.2011) MANU/RH/0001/2011

Challenge against award passed by the Motor Accident Claims Tribunal ordering compensation - As per disability certificate the claimant had suffered only 30% permanent disability due to loss of vision of right eye, however, Tribunal took the disability to be 100% - Secondly as contended, the loss of vision in one eye does not disentitle a person from applying for a licence - Further contended that it was nowhere recorded that the claimant was "incapable of driving a four wheel vehicle" and as per the Workmen's Compensation Act, 1923, loss of vision of one eye tantamount to only 30% of permanent disability

Held, a distinction has to be made between eligibility for getting a licence, and suitability for driving a vehicle. Although Form No. I and Form No. IA of the Central Rules may make a person eligible to seek a licence even if he/she has lost the vision of one eye, but it does not necessarily make such a person "suitable" for driving. Moreover, it is not the case of the Appellant that after having lost vision in the right eye, the claimant had applied for "a fresh licence" and the fresh licence was granted to him. Therefore, merely because Form No. I and Form No. IA of the Central Rules, permit a person, with the loss of vision of one eye, to apply for a licence, the existence of such Forms do not buttress the contention of the Appellant that the claimant was suitable or capable of driving a vehicle.

Than, merely because the claimant has admitted that his licence has not been cancelled also does not lead to the conclusion that despite the loss of vision of one eye, he is still capable of driving a vehicle. It is, indeed, a common knowledge that immediately after an accident, licence is not automatically cancelled by the concerned authority. Therefore, if the claimant continues to have his licence, it does not prove the fact that he is "capable of driving a vehicle".

Both in the claim petition and in his testimony, the claimant clearly stated "because of the loss of vision in his right eye, he was dismissed from his services as a driver by his employer". Impugned judgment correct. Appeal dismissed.

TRIBUNAL AND COMMISSIONS

Nimbus Communications Limited v Assistant Commissioner of Income Tax Circle 11 (1), Mumbai (Decided on 01.11.2011) MANU/IU/0004/2011

Arms Length Adjustment - Section 92 of the Income Tax Act, 1961 - No transfer pricing addition for non-charging of interest on overdue debt

Held,in terms of the provisions of Section 92, any income arising from an international transaction has to be computed having regard to the arm's length price (ALP), and that this exercise includes the allowance for any expense or interest arising from an international transaction as well. A continuing debit balance is not an international transaction per se, but is a result of the international transaction. A continuing debit balance in the account of the associated enterprises, does not amount to an international transaction under section 92 B in respect of which ALP. The factum of payment has to be considered vis-à-vis terms of payment set out in the transaction arrangement .In any event, even when an ALP is made in respect excessive credit period allowed under the CUP method, the comparable has to be dues recoverable from a debtor and not a borrower. Accordingly, the impugned addition of Rs 12,51,175 held to be unsustainable in law. Assessing Officer directed to delete the impugned adjustment. Appeal allowed.