Late objection to arbitration invalid

If a party to an agreement joins arbitration proceedings without raising objections, it cannot question the jurisdiction of the arbitration tribunal at a later stage. It would be deemed that the party had waived its right to object to the jurisdiction of the arbitration panel, the Supreme Court has stated in the judgment, Union of India vs M/s Pam Development (P) Ltd. In this case, the government had entered into an agreement with the works contractor to construct an electric loco shed. Later it terminated the contract alleging delay on the part of the contracting firm and inferior quality of work. This led to disputes and the contractor moved the Calcutta High Court to appoint an arbitrator. The High Court appointed a retired judge as the sole arbitrator. He decided in favour of the contractor. The government then moved the High Court to set aside the award. The court dismissed the application, leading to the appeal in the Supreme Court. In the apex court, the government argued that the arbitration tribunal was not properly constituted as the appointment was against the terms of the contract. The Supreme Court rejected the contention and stated that when the government did not object to the appointment of the arbitrator, the order became final. Moreover, the government filed its statement of defence and even raised counter claims before the arbitrator. Therefore, it was too late in the day for the government to question the jurisdiction of the arbitrator.

Sale must follow SARFAESI rules
The Supreme Court last week set aside the sale of a property under the Securitisation (SARFAESI) Act as it was done according to a private treaty between the creditor and the buyer without any agreement in writing and violating the rules of public auction. The judgment in the case, J Rajiv vs M/s Pandiyas, stated that "there were no terms settled in writing between the parties that the sale can be affected by private treaty." Moreover, the borrowers who could not repay the loans were not called at the meeting between the creditor bank and its agent for conducting the sale. Though the property was bought in 2006, the court directed that it shall be returned to the borrowers on certain conditions to protect all parties.

Labour pain in mergers

When there is merger or amalgamation of units, the employees have a right to get positioned appropriately in the merged service. There is, however, no vested right for an employee to have a particular position in the integrated or merged service. It is always open to the authorities concerned to lay down the principles with regard to fixation of seniority. On the other hand, incoming employees cannot be kept for all times as a different cadre and denied promotion while those in the parent cadre enjoy that benefit. The Supreme Court stated so while setting aside the judgment of the Madhya Pradesh High Court in the case, Panchraj Tiwari vs MP State Electricity Board. A junior engineer of the Rural Electricity Cooperative Society was aggrieved when he was denied promotion after the society was merged in the board. The board interpreted the terms of the merger with regard to staff as denying promotion to the employees of the absorbed society. The Supreme Court stated that though courts do not normally interfere with the principles of integration unless it was shown as arbitrary, unreasonable or unfair, in this case, the denial of promotion was unconstitutional as it was discriminatory.

Negligence in road accident claims
The Supreme Court has set aside the judgment of the Himachal Pradesh High Court which had reduced the compensation for the death of a youth from Rs 3.17 lakh, awarded by the motor accident compensation tribunal, to Rs 1.58 lakh. The High Court reduced the compensation on the assumption that the youth who was riding a scooter was driving rashly when he hit a bus. He also contributed to his fate. However, on the appeal of his mother, the Supreme Court stated that there was no evidence on record to show that the youth was driving negligently. It restored the tribunal's compensation in the case, Meera Devi vs HRTC.

Penalty on chemist cartel
The Competition Commission of India has imposed "deterrent penalty" on the Bengal Chemist and Druggist Association for indulging in anti-competitive practice in the sale price of medicines. It had asked its 34,000 odd members not to give discount on the maximum retail price. Members who did not obey were forced to shut down. This was brought to the notice of the commission, which took suo motu notice and initiated enquiry by its Directorate General. It largely confirmed the allegations and reported collusive action so that trade margins did not get determined on a competitive basis. The commission therefore imposed penalty on the association and 78 persons directly responsible for running its affairs at the rate of 7 to 10 per cent of their respective turnover/income/receipts based on the financial statements.

Injunction against trade mark
The Delhi High Court has restrained the use of the trade mark 'Genesis Skyon' by Genesis Infratech Ltd on a petition moved by Ireo Ltd which has claimed the trade mark 'Ireo Skyon Space Age Living'. Ireo Ltd, which is in real estate business, argued that it has registered the mark and the adoption of a similar name will confuse the market. Genesis Infratech defended its mark stating that Sky is a common descriptive word and therefore it could not be a subject of registration. The marks and the products are also different which would not be confused by consumers. Rejecting these arguments, the court stated that it was not sky which is the trade mark, but Skyon which is not a dictionary word. "A mere look at the trade marks will show that essential features are akin. The trade mark of Genesis is deceptively similar," the court said.