Influential relatives could be kept out of contracts: SC on BSNL appeal

The Supreme Court has ruled that relatives of employees of BSNL could be kept out of award of contracts if they are in influential positions. In this case, BSNL vs Bhupender, the notice inviting tender contained a disqualification – near-relatives working in any unit of BSNL could not participate. This was challenged in the Himachal Pradesh High Court, which struck down the clause.
The Punjab & Haryana High Court also took the same stand in a similar dispute. Therefore, BSNL appealed to the Supreme Court in all similar cases.
The Supreme Court cited a judgment of the Delhi High Court in which it stated that if the disqualified category of employees are defined, the rule would be legal. If they are in influential positions, the ban would be valid. But if they are in the lower category, without influence, their offer could be restricted by imposing conditions. The Supreme Court favoured the Delhi High Court view.
Repealed law cannot be used to settle disputes: SC
The Supreme Court has set aside the judgment of the Orissa High Court in which it had referred a dispute between a contractor and the chief engineer to the arbitration tribunal under the old Arbitration Act 1940.
The agreement in the case, Mahipatlal Patel vs Chief Engineer, had a clause which stated that disputes would be settled by the arbitration tribunal. When disagreements arose, the contractor approached the High Court seeking the appointment of an arbitrator under Section 11 of the new Arbitration & Conciliation Act of 1996.
The High Court rejected the request and stated that according to the agreement, the dispute should be resolved by the tribunal. So he appealed to the Supreme Court. It noted that the earlier law has been repealed and the state government itself had dispensed with the tribunal under the old law. Therefore, the order to refer the dispute to the tribunal could not be sustained. It asked the High Court to nominate an arbitrator.
Kerala HC order in Syndicate Bank vs New Look Rubbers wrong: SC
The Supreme Court has stated that the Kerala High Court had overstepped its jurisdiction in the case, Syndicate Bank vs New Look Rubbers. The latter became a sick unit and could not repay the bank loans.
In several proceedings, the civil courts upheld the bank’s claim to take over the unit and sell the property of the managing director. The High Court set them aside. The bank came on appeal and the Supreme Court held that the High Court orders were wrong.
Yeast is a chemical, says SC
The Supreme Court has resolved the conflict of views among the High Courts and held last week that yeast is a chemical and not fungus or a living organism. The question becomes important from the viewpoint of sales tax imposed by state governments.
The judgment was given in the appeal, Mauri Yeast India Ltd vs State of UP, against the ruling of the Allahabad High Court that yeast, used in baking, should be taxed. The Gujarat High Court took the same view. The Kerala High Court took the opposite view. Now, the issue has been settled.
SC dismisses LIC’s appeal against industrial court judgment
The Supreme Court has held in the judgment, LIC of India vs R Suresh that industrial courts can decide a dispute over the dismissal of an employee of the corporation.
In this case, a development officer of the corporation was dismissed for negligence causing loss. The industrial court asked the corporation to reinstate him as the punishment was too severe for the fault. LIC moved the Kerala High Court arguing that the Industrial Disputes Act would not apply in the case and the LIC Act of 1956 would apply. The argument was rejected. The Supreme Court dismissed LIC’s appeal.
PF law does apply to Himachal Pradesh Forest Corporation: SC
The Supreme Court has dismissed the appeal of the Himachal Pradesh Forest Corporation challenging its inclusion within the provident fund law. Its stand was that it was not an ‘industrial establishment’ according to the Employees Provident Fund Act and so the law was not applicable to it.
Later it admitted that the PF law applied to it. The dispute started in 1982 and most of the seasonal employees have since disappeared. Therefore, the court asked the corporation to implement the rules in the case of employees whose details are still available with it.
BS Reporter / New Delhi April 28, 2008


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