Deviation from tender conditions allowed

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The authorities can deviate from the conditions for sale by tender if the terms are not essential parts of the offer. In such cases, strict literal compliance is not required, the Supreme Court has stated in its judgment in Om Prakash vs Ramesh Chand. Setting aside the judgment of the Himachal Pradesh High Court, the apex court stated that conditions in advertisement inviting bids could be classified into two categories - those which lay down the essential conditions of eligibility and the others which are merely ancillary or subsidiary to the main object to be achieved. In the first case the authority may be required to enforce them rigidly. In the other cases it is open to the authority to deviate from and not to insist upon the strict literal compliance of the condition in appropriate cases. The dispute in this case arose when the Himachal tourism department invited bids for outright purchase of sites located at three places. One party succeeded in getting a site for a cafe, which was contested by a rival. The letter of intent in favour of the winning party was challenged on the ground that no reserved price was set and the condition regarding submission of annual turnover and net worth for last the three years was not complied with by the winner. The Supreme Court rejected these contentions stating that it was a case of outright purchase of the site and "there was no continued existence of any particular level of financial parameters on part of the bidder, except the ability to pay the price as per his bid."

SC settles decades-old tax dispute

It is a sign of the times that an income tax assessment case took 32 years to be finally decided by the Supreme Court last month. The revenue authorities ultimately won on the point whether the case was time-barred taking the various provisions of the Income Tax Act. In the appeal case, CIT vs Saurashtra Cement & Chemical Industries, the assessment year was 1981-82. In terms of Section 153 of the Act, the time limit for completion of the assessment is "at any time after the expiry of two years from the end of the Assessment Year." However, the dispute over the cut-off date was carried to the Gujarat High Court, which decided the appeal in 2005. The taxmen appealed and it took a decade to get the final word from the Supreme Court which stated that the high court erred. In a similar appeal from the Allahabad High Court, moved by Saraya Sugar Mills, the company won its argument. The apex court settled the difference between the two high courts over computation of the limitation period.

Cement firms spar over 'Ultra'

The Bombay High Court has rejected the objection made by Ultratech Cement Ltd against Dalmia Cement Bharat Ltd using the word "ultra" on its products. Ultratech alleged that the word was its trade mark and therefore the rival company was guilty of trade mark violation and "passing off". It alleged that the Dalmia Ultra mark was identical and deceptively similar to Ultratech. Dalmia Cement countered that there was no monopoly on the word "ultra" and the word was descriptive. Dalmia used the word "ultra", prefixing it with Dalmia, and therefore there was no likelihood of confusion among the consumers. The high court agreed with Dalmia and stated that "no individual trader can possibly monopolise the term 'ultra'. Prima facie the word cannot be distinctive of any particular trader's goods… If someone uses the word 'ultra' as a prefix or in combination with other words/features, there cannot be any cause to complain."

Trade mark tiff over 'Cutler-Hammer'

In another trade mark dispute over the name Cutler-Hammer for electric apparatuses used in machines, the Delhi high court dismissed the appeal of BCH Electric Ltd against the claim of the trade mark by Eaton Corporation. BCH used the name Bhartia Cutler-Hammer for its products which was objected to by Eaton. The two firms, earlier linked to a US company, had undergone changes in names and shareholding pattern and had business relations. The single judge of the high court had passed an injunction against BCH, stating that its conduct was deceitful and it misrepresented facts for registration. It unsuccessfully appealed to the division bench.

School book suppliers lose suit

The Allahabad high court has dismissed a set of writ petitions moved by manufacturers and printers of school text books challenging the Uttar Pradesh government's policy on the quality of paper used for books distributed to school students in the state. Participants in the tender for supply of books also had joined the fray in the case, Fibremarx Papers Ltd vs State of UP. The text book manufacturers argued that the February notification allowing the inclusion of virgin pulp paper of bamboo or softwood base for school books was contrary to the statutory environmental statutory norms. The notification created a monopoly in favour of certain manufacturers, it was alleged and it violated the norms set by the Bureau of Indian Standards. The rival traders in paper contended that there was no change in policy and virgin pulp paper was being used earlier too and was not unfriendly to the eco-system. The government argued that the notification did not endanger ecology but was meant to prevent recycling of paper for school books. It also argued that the state could prescribe the quality of paper as a matter of policy which cannot be challenged in a court.

IOC told to remove illegal terms

The Calcutta high court last week asked Indian Oil Corporation to redraft its 2009 memorandum of understanding with its officers' association within six weeks. The association moved a writ petition alleging that the public sector corporation had obtained an agreement signed by six officers by subterfuge. Three were dismissed employees and three others were suspended officers. They had not been authorised to sign the agreement on behalf of 15,000 officers. The six did so on the promise of reinstatement, fast-track promotion and desired posting, it was alleged. The company argued that the petition was filed after considerable delay and the rest of the officers have accepted the agreement. It claimed the right to derecognise the association if it persisted on its demands. The high court stated that certain clauses in the agreement tended to unreasonably restrict the fundamental rights of free association and speech and therefore were void from start. Those terms should be "blue-pencilled" and removed to save the rest of the agreement which was signed under "dubious circumstances".