The Supreme Court dismissed last week the appeal of the Kerala Finance Corporation which had claimed a right to demand higher rate of interest from defaulting borrowers. The corporation argued that according to the agreement, it has a right to enhanced rate of interest on loan from time to time. In this case, Kerala Finance Corporation vs C G Narayanan, the original rate was 5.5 per cent. But when the borrower defaulted, the corporation demanded a rate of 11.75 per cent. This was challenged by the corporation in the civil court, the high court where it lost. The Supreme Court also dismissed the appeal.
Sale of firm confirmed
The Supreme Court last week confirmed the sale of Jay Electric Wire Corporation Ltd at Mysore by the liquidator, subject to several conditions. Disposing off the appeal in the case, Pravin Gada vs Central Bank of India, the court said that keeping in view the interest of the workers and their rights, the Bombay High Court should deal with their rights “in an apposite manner and, if required, monitor the same.” The appeal was against the high court judgement which had quashed the order passed by the Debt Recovery Appellate Tribunal wherein it had set aside the order of the Debt Recovery Tribunal and restored the confirmation of sale conducted by way of public auction in favour of those who appealed to the Supreme Court.
Right of bank probationers
A bank probation officer may be terminated at the end of the term because of unsatisfactory performance or failing to complete the training successfully, but if he is sent away on a charge of using unfair means at the test, he should be heard before taking action, the Supreme Court stated last week in two judgments, one being SBI vs Palak Modi. In these cases, the foundation of the action taken by the General Manager was the accusation that while appearing in the objective test, the probationers had resorted to copying, which was confirmed by the computer system. However, they were “condemned unheard which was legally impermissible,” the court said and asked the bank to reinstate them as ordered earlier by the Allahabad High Court.
ITDC to pay subsistence wage
The Delhi High Court last week stated that subsistence allowance should be paid to workers during the pendency of appeals, even if the relationship between the employer and employees is yet to be established. The amount paid is not refundable or recoverable from the employees even if the award is set aside by a high court or the Supreme Court. In this case, India Tourism Development Corporation, IGI Airport Restaurant and public sector Ashok Hotel of Delhi denied the employer-employee relationship and maintained they were contract workers. However, the labour court found that they were in fact employees and told the managements to reinstate the workers with back wages. The companies moved the high court, arguing that they were not their employees and therefore the labour court was not justified in ordering payment of subsistence allowance under Section 17-B of the Industrial Disputes Act. The division bench of the high court rejected this contention and ruled that the law has been made to give relief to a worker, who has been ordered to be reinstated by an award of a labour court or an industrial tribunal, during the pendency of appeals. While the issues raised by the managements must be decided on evidence, subsistence allowance cannot be denied.
Arbitral award confirmed
The Delhi High Court last week dismissed the appeal of a contractor who had challenged the arbitral award in a dispute related to his claim for enhanced payment on account of escalation in minimum wages and material cost during the period of contract as also the extended time period. In this case, N J Devani vs Indian Farmers Fertiliser Corporation, the arbitrator rejected the argument that the increased cost should be taken into account while paying the contractor’s bill. The award stated that there was indeed an extraordinary increase in the minimum wages. “The contractor with open eyes, without any protest and with its own free will,” executed the contract which contained a ceiling clause. He did not reserve any right to claim wage escalation then. Therefore, he cannot wriggle out of the condition of the contract, the award said. The high court declined to re-examine the evidence.
Foreign cosmetic firm wins TM case
The Delhi High Court has granted a permanent injunction and costs in favour of the multinational cosmetic firm Bourjois Ltd against an Indian firm over the trade mark Bourjois. In the case, Bourjois Ltd vs Naunihal Singh, the court stated that the Indian firm was passing off their services as those of the foreign company by using the disputed trade name for rendering saloon/spa services and as a part of their domain name. This was going on in several towns in Punjab and south India. This is likely to mislead customers as the services are in the same sector and the complaint of the foreign company was justified, the high court said.
