Escorts arbitration appeal dismissed

The Supreme Court has dismissed the appeal of Escorts Ltd, ruling that the arbitration award made in the US against it was final and binding. Universal Tractor Holding LLC and Escorts Agri Machinery Inc, a subsidiary of Escorts Ltd, were holding shares in Beever Creek Holdings. There was an agreement by which Universal sold its shareholding in Beever to Escorts Agri. The latter defaulted in payment leading to a suit in North Carolina. It was later referred to arbitration, which went against Escorts Agri. Escorts companies had merged, and the Indian company objected to the execution of the award in India.

The Delhi High Court rejected the objection, against which the firm moved the Supreme Court. It rejected that argument of Escorts that Universal ought to have proceeded for confirmation of the award under the US law and then come to India for execution. The judgment pointed out that the requirement of "double exequatur", as pleaded, has been dispensed with in the New York Convention and the Indian Arbitration and Conciliation Act.


Guidelines on compensation

In road accident claims under the Motor Vehicles Act, the statutory schedule for calculating compensation need not be scrupulously followed by tribunals and courts, the Supreme Court stated in the judgment, Reshma Kumari vs Madan Mohan.

There were differing views among Supreme Court judges for over a decade about the second schedule of the Act. Some judgements held the view that the table for calculating damages was "unworkable". Some other decisions maintained that the schedule was a good guide for computing compensation. Despite this raging controversy, Parliament had failed to make amendments in the law for two decades. In view of the differences, this case was referred to a larger bench for a final view. In this judgment, the three-judge bench analysed earlier judgments of the Supreme Court and laid down a set of guidelines for arriving at a fair figure for damages under various situations, like when the accident was caused by negligence (Section 166) and when 'no-fault liability' is invoked (Section 163-A). The court asked all forums below to follow the new guidelines and those laid down in its 2009 judgment in Sarla Verma vs Delhi Transport Corporation, setting to rest the contrary views.

Bharat Petroleum evicted
The Supreme Court last week ordered eviction of public sector Bharat Petroleum Corporation, which was paying Rs 400 a month to its Mumbai landlord since 1955, and allowed the landlord to take criminal action against the firm for inducting rank outsiders in collusion with its dealer.

The oil giant argued that it had a right to renew the lease under the Burmah Shell (Acquisition of Undertakings in India) Act, 1976. It further argued that under the lease deed also, it had a right to get renewal of the lease for 30 years. Dismissing its appeal with costs, the judgment emphasised that the company could not claim any further renewal even under the Act beyond 2005.

Insurer to pay for loss of eye
The Supreme Court last week set aside the rulings of the National Consumer Commission and the Chhattisgarh state consumer commission and awarded Rs 7 lakh with interest to a person who had lost sight in one eye when he fell down while playing. In this case, Sandeep Chourasia vs New India Assurance Co, the company argued that the insured person had no eyesight from his birth. When this was disputed, a medical team conducted investigation which stated that the "loss of vision could have been caused by fall while playing". The commissions did not rely on the expert evidence and rejected the claim. On appeal, the Supreme Court stated that the commissions committed "serious error" by not accepting the medical report. It ruled that the insurance policy, called Janata Gramin Vyaktigat Durghatana, covered the accident of this nature.

Temporary hands get paid
The Supreme Court has ordered compensatory payment to workers of Bajaj Auto Ltd who had alleged that they were kept on temporary basis for several years denying permanent status. They alleged unfair labour practices under the Maharashtra law.

According to them, they were engaged in 1990; yet they were offered employment only for seven months each year and after the expiry of the period, their services used to be terminated. This was violation of the Model Standing Orders in the Industrial Employment (Standing Orders) Act. The company contested and stated that they were engaged to meet targets, on temporary basis, with the consent of the trade union. The industrial court stated that the employees had clearly been continued for years but were not granted the status or privilege of permanency. It asked the management to pay sums calculated by the court.

The appeal of the company was dismissed by the Bombay High Court with adverse remarks against it. In its final appeal, the Supreme Court modified the order of the industrial court and reduced the payment.