Case BriefsHigh Courts

Kerala High Court: P.B. Suresh Kumar, J. while allowing a land acquisition appeal, set aside the impugned award and restored the Collector’s award.

Respondent’s land had been acquired for laying down of railway line pursuant to a notification issued in 1991 under Section 4(1) of the Land Acquisition Act, 1894. Respondent received compensation on the basis of land value fixed by the Land Acquisition Officer. Later, in a reference under Section 18 of the Act, the reference court enhanced the land value of another land covered by the same notification, but categorized differently. The respondent preferred an application for redetermination of the compensation granted to him in tune with the award of reference court. The Collector redetermined the compensation payable to respondent based on the land value fixed by the reference court. Nevertheless, the first respondent sought a reference under Section 28-A(3) of the Act as, according to him, the Collector ought to have granted the land value granted by reference court. The reference court enhanced and refixed the land value of the acquired land as prayed for by the first respondent. Aggrieved by the said order, the instant appeal was filed by the State.

The Court observed that the the Land Acquisition Officer had categorized lands notified for acquisition for the purpose of fixing land value; and the land held by the respondent was covered under a different category than the one in respect of which the reference court had passed an order. It was for the said reason that the Collector had made a proportionate reduction while awarding compensation to the respondent.

Thus, the Court upheld the Collector’s proportionate reduction in redetermining the compensation payable to the first respondent while setting aside the reference court’s modification of the Collector’s award. It was opined that the reference court cannot treat a land included by the Land Acquisition Officer in one category as one included in another category and redetermine the compensation on that basis as done in the instant case, as such powers, though available to Court under Section 18 of the Act, are not available to the Court in a reference under Section 28-A(3) of the Act.

While setting aside the impugned award and restoring the Collector’s award, the Court also observed that the object of Section 28-A(3) of the Act is to enable those who could not avail the remedy under Section 18 of the Act to obtain compensation for the lands acquired from them also.[Karunakaran Nair v. State of Kerala, LA App. No. 229 of 2016, decided on 20-03-2019]

Case BriefsHigh Courts

Gauhati High Court: Suman Shyam, J. dismissed an appeal filed by an insurance company against the order of the Commissioner directing payment of compensation to an employee for permanent disability endured during his employment, as a result of an accident.

In the present case, the respondent met with an accident while driving an insured vehicle, and resultantly he suffered many injuries. The respondent filed a case for payment of compensation before the Workmen Compensation Commissioner, for compensation on the ground that the injuries suffered by him in the accident had resulted into his permanent partial disablement leading to loss of his earning capacity. The Commissioner awarded the payment of Rs 1,71,234 to the respondent after taking into consideration his monthly salary of Rs 3500 and the testimony of the doctor according to whom, the respondent had suffered 25 per cent permanent disability reducing his earning capacity by about 40 per cent. The present appeal had been made by the insurance company against the order of the Commissioner, Workmen Compensation under Section 30 of The Workmen Compensation Act, 1923. 

The learned counsel for the appellant, M. Choudhury, contended that the payment of compensation for loss of earning capacity cannot be worked out on the basis of mere assumption of a doctor, i.e., the doctor has only got a speculative role in deciding the percentage of loss in the income of the respondent/claimant. Furthermore, the salary of the respondent should not be taken into consideration while the calculation of the compensation. She also placed reliance on the judgment of Oriental Insurance Company Ltd. v. Bimal Pathar, 2017 SCC OnLine Gau 1292.

The learned counsel for the respondent Rajbarbhuiya contended that the credibility of the testimony of the witness doctor was never questioned or challenged by the appellant. before the Commissioner. He further said that the plea of the appellant should not be entertained, keeping in mind the beneficial object of the Act.

The Court observed that the daily allowance earned by a workmen can be taken into consideration while calculating the compensation. It was opined that the case of Oriental Insurance Company v. Bimal Pathar, 2017 SC OnLine Gau 1292,  itself gave this principle and the reliance of the appellant’s counsel on the given case mitigated the scope of dissent in this regard. It was further observed that the testimony of the doctor in the present case, was not merely speculative in nature. The same had been substantiated through X-ray reports and further fortified through the disability certificate presented by the respondent.

It was opined that though this Court was the court of the first appeal in this matter by virtue of Section 30 of the Act, it would not entertain a factual dispute which was not even raised by the appellant herein, at the time of the trial. Thus, the appeal was dismissed and payment of the balance amount to the respondent was ordered within six weeks.[United India Insurance Company v. Naren Deka, 2019 SCC OnLine Gau 2259, decided on 07-05-2019]

Case BriefsHigh Courts

Patna High Court: The Bench of S. Kumar, J. dismissed an appeal filed by the insurance company against the judgment and award passed by Motor Vehicle Accident Claim Tribunal, Bihar.

The son of claimant died on the spot when a vehicle dashed against him. As a result, he filed a complaint against the driver (Opposite Party 2) under Sections 279 and 304-A of the Penal Code, 1860. The offending vehicle was insured with the New India Assurance Company Ltd. (Opposite Party 3) and the claimant made claim for payment of compensation amount Rs 6 lakhs. The District Judge-cum-Motor Vehicle Tribunal granted compensation of Rs 3,65,000 to the claimant. Aggrieved by the quantum of compensation granted, the New India Assurance Company Ltd. filed an appeal against said judgment and award.

The Court dismissed the appeal placing reliance on the judgment of Apex Court in Reshma Kumari v. Madan Mohan, (2013) 9 SCC 65, and held, “the claimants are entitled for compensation of the amount as granted by the Tribunal and not inclined to interfere with the quantum of compensation amount granted by the Tribunal.” It also directed the insurance company to pay the amount of compensation to the claimant, with an interest at 6 per cent from the date of filing of the claim application till its realization within two months, from the date of receipt of the order passed by the Court. [New India Assurance Company Ltd. v. Amiri Khatoon, 2019 SCC OnLine Pat 630, Order dated 06-05-2019]

Case BriefsHigh Courts

Allahabad High Court: This petition was filed by petitioners before the Division Bench of Pankaj Kumar Jaiswal and Dr Yogendra Kumar Srivastava, JJ. praying for a direction to the respondent to decide the application of petitioner filed under Section 28-A of the Land Acquisition Act, 1894 and to re-determine compensation sought to be given to the petitioner.

Facts of the case were such that a notification was issued under Section 4(1) of the Act, 1894 where an award was passed by the Special Land Acquisition Officer, Ghaziabad in respect of certain land parcels. Petitioner did not challenge the aforementioned award under Section 18 of the Act but the same was challenged by other persons which gave rise to land acquisition references decided by District Judge thereby re-determining the compensation amount. It was against this judgment that the first appeal was filed which was decided with the re-determined compensation amount. Under the decision in the first appeal, the petitioner filed an application under Section 28-A of the Act to claim the benefit of the re-determined compensation. This application was rejected.

The question before Court was to decide if the application was time-barred under Section 28-A of the Act which mentioned about re-determination of the amount of compensation on the basis of the award of the Court within 3 months of its decision. Thereby leading to the second question from which Court’s decision the time period was to be calculated i.e. Reference Court or High Court first appeal. 

Krishna Mishra, learned counsel on behalf of petitioners, submitted that the time period for claiming the benefit of re-determined compensation amount was to begin after the decision in the first appeal and since their application was within that time period the application was validly made. Suresh Singh learned Addl. Chief Standing Counsel appearing on behalf of State respondents, submitted that the limitation period to file application was to be taken from the date of the award made by Reference Court which means that petitioner’s application was time-barred.

Under the Act, Court was defined to mean a principal Civil Court of original jurisdiction. Catena of cases were referred to concluding that limitation period should be computed from the date of award of Reference Court on basis of which re-determination was sought and not from the appeal which was filed against the award. Accordingly, the application thus filed was beyond the time period of 3 months if computed from the award of Reference Court. Further, proviso of the Section did not state any other reason for the extension of the time period than to obtain a copy of award.

High Court on the discussion above was of the view that petitioners could not have claimed the benefit of re-determined compensation as their application was time-barred. The application was to be filed within 3 months of the award passed by Reference Court and not after the decision of High Court in first appeal. Therefore, this petition was dismissed. [Tejpal Singh v. State of U.P., Writ C No. 7218 of 2019, Order dated 08-03-2019]

Case BriefsTribunals/Commissions/Regulatory Bodies

National Consumer Disputes Redressal Commission: Justice V.K. Jain (Presiding Member), allowed a consumer complaint seeking a refund of money paid to book a residential flat in a construction project being carried out by the developer. 

Complainant herein had booked a residential flat in a project started by the opposite party (OP) by paying a booking amount of approximately Rs 1 crore. As per the allotment letter dated 20-02-2015, possession of flat was to be delivered to the complainant by March 2015; though an additional grace period of six months was available to the OP which could be invoked in case the possession was delayed due to unforeseen circumstances. However, the complainant was not given the possession even after almost 3.5 years.

The OP resisted this complaint on the ground that the delivery of possession got delayed as land on which project was to be developed was acquired by Yamuna Expressway Industrial Development Authority (YEIDA), and the said acquisition was challenged by landowners in Allahabad High Court. Further, the National Green Tribunal had prohibited the use of groundwater for construction purpose. Also, the supply of raw material and labour was disrupted due to strikes/agitation by the farmers whose land was acquired.

The Commission noted that the aforestated contentions had already been considered and rejected by it in its order dated 16-04-2019 in STUC Awasiya Grahak Kalyaan Association v. Supertech Ltd. (CC No. 2335 of 2017). In that case, this Commission had clearly held that it was for the OP to arrange water for construction purposes from alternative sources. Further, the land acquisition challenge had been decided by Allahabad High Court in October, 2011 itself and while the Supreme Court did uphold the said High Court’s judgment in appeal, no order was passed restraining builders (particularly the builders in YEIDA) from raising construction on the land. Moreover, the agreements with the complainant had been executed much later than the Allahabad High Court’s decision. Lastly, no direct evidence had been led by the OP to prove the dates on which farmers had actually prevented the construction work.

It was noted that the completed drawings were submitted by the OP on 15-02-2015 itself, which meant that the construction had been completed by that date but the requisite Completion Certificate/Occupancy Certificate had still not been issued.

Reliance was placed on the judgment in Pioneer Urban Land & Infrastructure Ltd. v. Govindan Raghavan, 2019 SCC OnLine SC 458 where it was held that complainants cannot be made to suffer and wait indefinitely for possession of the flat allotted to him, and is entitled to seek refund of the amount paid by him, along with compensation.

In view of the above, the complaint was allowed and OP was directed to refund the entire amount received from complainant, and also compensate them in the form of simple interest of 10 percent per annum from the date of each payment to the date of refund. OP was also directed to pay litigation costs of Rs 25,000 to the complainant.[Ajai Kumar v. Supertech Ltd., 2019 SCC OnLine NCDRC 63, Order dated 22-04-2019]

Case BriefsHigh Courts

Jharkhand High Court: The Bench of Sanjay Kumar Dwivedi, J. allowed an appeal and set aside the order passed by Tribunal for disallowing the claim petition of the said appellant against the respondent Railways.

The appellant contented to the Tribunal that delivery of goods was not within the stipulated time period and also the quantity of goods which in this particular case was oil was less than that of actual consignment and the seal of the said goods were broken. All the measurements of goods and the condition of goods were examined by the private staff along with the respondent’s staff, i.e., the Railway’s commercial staff. The aggrieved appellant claimed for the damages sustained due to criminal interference in transit along with compensation. The appellant submitted that the consignment was delivered after six months and there was laches on the part of the Railways and the Railways was responsible and the Tribunal committed an error by dismissing the claim of the appellant.

The respondent Railways argued that the examination of goods was not made by the appropriate authority and all the contentions of the appellant regarding the seal breakage and quantity has no substance as no short certificate was issued. They further submitted that when the goods are not loaded at the Railways siding according to the Act, Railways cannot be held liable for damages and in this particular case the goods were loaded at the siding of the appellant.

The Tribunal adjudicated the matter in favor of the respondent Railways and discharged their liability to pay any compensation for damages caused to the appellant; it further dismissed the appellants claim for compensation.

The Court observed the contentions of the appellant suggesting “In view of Section 93 of the Act, the Railway is responsible for the loss, destruction, damage or deterioration in transit, or non-delivery of any consignment. Section 95 of the Act provides that Railway Administration shall not be responsible if the railway proves that the delay or detention arose for reasons beyond its control or without negligence or misconduct on its part or on the part of any of its servants.” Court relied on the arguments of appellant relating to Section 99 of the Act, which held Railway administration as a bailee under the Indian Contract Act, 1872 hence, abiding with all the duties of a bailee related to loss, destruction and damages etc.

The Court held, “Railways has to deal with the goods put in its care as a bailee and has to take the same amount of care for the goods as a man of ordinary prudence not only during period of transit of goods from the station of origin to the station of destination but for a period of 7 days after the termination of transit.” The Court further found that consignment was properly secured when placed with Railways and the Railways staff had full accessibility to examine the loading and unloading of goods. There was unnecessary delay in the delivery of the goods for which railways had no explanation. Court reversed the order of Tribunal and held Railways liable for the damages and delay of goods and granted compensation to the appellant.[Rajinder Kumar Mohal v. Union of India, MA No. 65 of 2017, decided on 02-05-2019]

Case BriefsHigh Courts

Orissa High Court: The Bench of Dr A.K. Rath, J. dismissed the suit for realization of the insurance money on the ground that no communication of renewal of the policy was made at the time of the alleged occurrence and no risk could be assumed in the absence of any valid policy.

The facts of the case were that the plaintiff was the owner of a shop, he availed a cash credit loan of Rs 20,000 from the State Bank of India. He had stock of Rs 30,000 in the shop. The Bank insured the shop with the New India Assurance Co. Ltd. After the expiration of the policy, he sent a letter along with a cheque of Rs 300 to defendant 1 for renewal of policy for another year. In the meanwhile, a theft was committed in the shop in which goods worth Rs 45,383 was stolen. The plaintiff claimed insurance money. The defendant, denying the liability pleaded that the plaintiff had not sent a letter along with a cheque of Rs 300 to defendant 1 for renewal of policy on time and it was received after the expiration of the policy, thus there was no risk covered on the day the theft happened as there was no policy on the date of the occurrence. Thus there was no liability to pay compensation.

The Court held that the cheque was sent after the expiry of the policy. No communication was made by the defendant to the plaintiff about the acceptance of the proposal. No policy was issued by the defendant. There was no concluded contract. Thus the defendant was not held to be liable to pay any amount towards the alleged loss sustained by the plaintiff. The appeal was thus dismissed. [Prasanna Kumar Acharya v. Oriental Insurance Co. Ltd., 2019 SCC OnLine Ori 157, decided on 10-04-2019]

Case BriefsHigh Courts

Bombay High Court: Sunil K. Kotwal, J., allowed SBI Insurance Co. (insurer) to recover, from the owner of the offending bus (insurer), the amount paid to a third party claimant) under a policy which was cancelled by the insurer on account of non-payment of the premium amount by the insured.

An accident occurred between a motorcycle and the offending bus, as a result of which the driver of the motorcycle passed away. A claim petition was filed by the claimants under which an award was passed by the Motor Accident Claims Tribunal. The insurer paid the claim amount in the discharge of its liability towards the claimant. It, however, claimed to recover the said amount from the insured. Insurer’s case was that the insured issued a cheque in his favour towards payment of the insurance premium for the policy taken on 10-11-2015. The accident occurred on 19-11-2015. Pertinently, the cheque issued by the insured towards payment of premium got dishonoured by the bank and, therefore, the insurer cancelled the policy on 14-12-2015. As such, the insurer claimed recovery of the amount paid to the third party.

After perusing the authorities cited, the High Court was of the opinion that in such type of cases, if the policy is cancelled before the accident occurs, then the insurer is not liable to pay compensation to the claimant. However, if the policy is cancelled after the accident happens, then he is so liable. But, in the latter category of cases, the insurer is entitled to recover the amount so paid to the claimant from the insured. It was observed that a contract of insurance between an insurer and an owner of the offending vehicle includes reciprocal promised by both the parties. In such view of the matter, the owner of the offending bus (insured) was directed to pay back the amount of the award to the insurer along with interest thereon. [SBI Insurance Co. v. Madhubala, 2019 SCC OnLine Bom 639, decided on 15-04-2019]

Case BriefsHigh Courts

Kerala High Court: The Division Bench of K. Harilal and Annie John, JJ. dismissed an appeal filed by an insurance company against the order of Commissioner for Workmen’s Compensation (WCC) directing it to pay a certain sum of money to the respondent herein.

Respondent herein had filed an application under Section 22 of the Workmen’s Compensation Act, 1923 seeking compensation for the death of one driver Xavier while driving a car owned by one Trissa, on collision with a lorry. WCC allowed the said application. Aggrieved thereby, the present appeal was filed by insurance company.

Appellant company challenged this award contending that the respondent had already been awarded compensation by the Motor Accident Claims Tribunal (MACT) under Section 140 of the Motor Vehicles Act, 1988. Therefore, she was estopped from filing the application under Workmen’s Compensation Act.

The Court noted that as per Section 167 of the MV Act, the aggrieved party can claim compensation either under the Workmen’s Compensation Act or under Chapter 10 of the MV Act. One cannot proceed under both the statutes for compensation. However, in the instant case, though the respondent received interim compensation under MV Act, she subsequently withdrew her case under MV Act and WCC deducted the amount awarded by MACT. Thus, at the time of passing the impugned award, there was no proceeding under the MV Act.

It was opined that merely for the reason that earlier the claimants proceeded under the MV Act and later, withdrew the said proceedings and filed for compensation under the Workmen’s Compensation Act, it cannot be held that the subsequent claim was barred by Section 167 of the MV Act.

Thus, it was held that there was no illegality or impropriety in the impugned award granting compensation under the Workmen’s Compensation Act after deducting the interim award granted by MACT.[United India Insurance Company Limited v. Mary, 2018 SCC OnLine Ker 8199, Order dated 14-12-2018]

Case BriefsHigh Courts

Delhi High Court: I.S. Mehta, J. dismissed an appeal filed by the claimant against an award of compensation granted in a motor accident’s claim by the Presiding Officer, Motor Accidents Claim Tribunal-2 (Central), Tis Hazari Courts.

Bhagwat Prasad was crossing a road when he was hit by a motorcycle. He filed a claim petition against the driver of the motorcycle as also the insurer. The Tribunal awarded a compensation of Rs 1,46,572 plus interest to Bhagwat Prasad. Not satisfied with the quantum of compensation, he filed the present appeal.

D.S. Bhandari, Advocate for Bhagwati Prasad challenged the award on various grounds including that the Tribunal did not award any compensation towards loss of income due to inability. Per contra, Pankaj Gupta for Suman Bagga, Advocates representing the insurer supported the Tribunal’s order.

The High Court noted that Bhagwat Prasad relied upon his disability certificate of 42% which was not permanent disability. This, according to the Court, disentitled him for compensation towards loss of income. In view of the Court, the same also disentitled him for compensation towards future treatment. As far as the plea regarding the loss of disfigurement is concerned, the Court observed, “the same losses its significance, as, the injuries on the person is a temporary fracture…As such fracture on the ankle is not permanent in nature and is curable. The same cannot be classified as disfigurement injury which could be a stigma in the society and a factor to lower down his position in the society. Therefore, appellant is not entitled to any compensation towards disfigurement.”Finding no infirmity in the impugned award passed by the Tribunal, the Court dismissed the present appeal. [Bhagwat v. Laxman, 2019 SCC OnLine Del 7339, decided on 26-02-2019]

Case BriefsHigh Courts

Patna High Court: The Bench of Mohit Kumar Shah, J. hearing a civil writ petition against power distribution company, allowed the affected party to claim compensation from the company for damage caused to its property owing to the layout of electric wires.

The present petition prayed for a command to the respondent to shift an 11,000-voltage of live wire passing over the residential house of the petitioner, as the same had been hanged without his permission. The respondents opposed the same stating that the electric wire had been laid about twenty years prior to the construction of petitioner’s house but no objection was raised by the petitioner at the time of laying the wire. Moreover, the wire passed by the side of the house over an asbestos shed. Further, about 9000 consumers were being benefited by the electricity in question and there was no feasibility for shifting the line.

The Court followed law laid down by the Apex Court in the case of Power Grid Corpn. of India Ltd. v. Century Textiles and Industries Ltd., (2017) 5 SCC 143 wherein it was held that Section 10 of the Indian Telegraph Act, 1885 empowers the telegraph authority to place and maintain a telegraph line under, over, along or across and posts in or upon any immovable property; and in doing so, the government acquires only a right of user in the said property. The authority is obliged to ensure that it causes as little damage as possible and if any damage is caused by exercise of those powers, it is obliged to pay full compensation to the affected party for the damage sustained.

Accordingly, the petition was disposed of with the consent of parties with liberty to the petitioner to avail remedies as available to him under the aforesaid judgment. [Sanjay Kumar v. North Bihar Power Distribution Company Ltd., 2018 SCC OnLine Pat 2317, Order dated 05-12-2018]

Case BriefsHigh Courts

Uttaranchal High Court: The Bench of Narayan Singh Dhanik J. disposed a compounding application along with a criminal writ petition and quashed the First Information Report filed against the accused applicant on the ground of amicable settlement of the dispute between the parties.

The instant application had been filed for quashing FIR registered against the applicant under Sections 406, 420, 467, 468 and 471 of the Indian Penal Code. The accused-applicant and respondent-complainant entered into a compromise whereby the loss suffered by respondent was duly compensated and dispute between both the parties had been amicably settled. The complainant had no grudge or grievance against the accused-applicant and hence he was not interested in further prosecution.

The Court observed that though the complainant can be permitted to enter into the compromise for offences under Sections 406 and 420 IPC, but for the offences under Sections 467, 468 and 471 IPC, the complainant has no right to enter into a compromise with the accused. However, it was opined that in the present case, as the complainant and accused had willingly and amicably arrived at compromise; and complainant was not interested in further prosecution, therefore it would be futile to permit future trial inasmuch as it would not reach to its logical and correct conclusion as there is great possibility of witnesses turning hostile.

In view of the above, compromise arrived at between the parties was accepted and the compounding application was allowed. [Akil Ahmad v. State of Uttarakhand, 2019 SCC OnLine Utt 10, Order dated 16-01-2019]

Case BriefsHigh Courts

Madras High Court: The Bench of T. Ravindran, J. set aside the order of Deputy Commissioner of Labour whereby he had set aside the earlier order for compensation passed ex-parte in favour of the petitioner herein.

Petitioner suffered injuries at his workplace and sought compensation from the respondent. The Deputy Commissioner, by an ex-parte order, awarded him a compensation of Rs 2,39,380. The respondent contended that it was not able to appear before the Authority due to communication gap and wrong noting of dates of hearing. The Deputy Commissioner allowed the application of respondent ad set aside it earlier order. Aggrieved thereby, the petitioner filed the present civil revision petition.

After perusing the entire record, the High Court found that the Deputy Commissioner did not properly appreciate petitioner’s submission that the earlier order was not an ex-parte order but was one passed on merits. Furthermore, the respondent did not place nay evidence to substantiate the cause of non-appearance pleaded by it. The very basis of the cause projected by the respondent was not established in any manner. The Court held that in such case, the Deputy Commissioner should not have entertained the respondent’s application. In such and other view of the matter, the petition was allowed and the impugned order was set aside. [S. Dhanasekaran v. Sree Nithyakalyani Textile Ltd., 2018 SCC OnLine Mad 4910, Order dated 18-12-2018]

Case BriefsHigh Courts

Punjab and Haryana High Court: This appeal was filed before a Single Judge Bench of Lisa Gill, J., by the Insurance Company challenging its liability to pay compensation to the claimants which was awarded by the Motor Accident Claims Tribunal.

Facts of the case were that the claim petition was filed under Section 166 of the Motor Vehicles Act, 1988, by the claimant-respondent and the same was decided by the Tribunal and compensation of Rs 2,89,012 along with interest at the rate of 6% per annum was awarded on account of injuries received by respondent in the motor vehicle accident. Appellant i.e. the insurance company contended that the Tribunal erred in holding that a valid driving license was present with the driver of the offending vehicle. Offending vehicle being a bus. It was further submitted that ‘unladen weight’ and ‘gross vehicle weight’ are distinct from each other. And according to the driving license he was not entitled to drive the bus.

High Court observed that the driving license found with the offending vehicle’s driver was valid for a transport vehicle. The appellant had failed to show that the driving license was valid for driving of Light Motor Vehicle Non-Transport, Transport Vehicle and Light Motor Vehicle CAB. It was also observed that the distinction between the ‘unladen weight’ and the ‘gross vehicle weight’ was irrelevant. Since appellant had failed to show that respondent was carrying an invalid driving license the appeal should be dismissed. Therefore, on finding no ground to interfere in the impugned order, this appeal was dismissed. [United India Insurance Co. Ltd. v. Gurchain Singh, 2018 SCC OnLine P&H 2723, decided on 20-12-2018]

Case BriefsHigh Courts

Delhi High Court: The Bench of Sanjeev Sachdeva, J. ordered mother-in-law of the petitioner to provide her an alternate accommodation and compensation under provisions of Protection of Women from Domestic Violence Act, 2005.

Petitioner and her husband lived together in the property which is subject matter in this case. In 2012, the husband left the matrimonial house and the respondent (mother-in-law) directed the petitioner to leave the house. She is alleged to have filed a suit for permanent injunction after which the litigation story began. After several litigations, the Metropolitan Magistrate passed a residence order in favour of the petitioner. It was alleged that the order was not complied with and moreover the mother-in-law sold the subject property to a third party while the matter was still pending adjudication before the court.

Rajeev Ranjan Pandey, Advocate submitted on behalf of the petitioner that the respondent was liable to be prosecuted for breach of court orders.

The High Court referred to Sections 12, 19, 20 and 31 of the DV Act. It was noted that the subject property was sold for Rs 3,40,00,000. It was also noted that there was no order restraining the mother-in-law from selling the property and as such she could not be penalised under Section 31 which prescribe punishment for breach of court orders. In such a situation, the Court balanced the corresponding rights of the parties by directing the mother-in-law to provide an alternate accommodation in a property similar in nature in the same locality. Interim compensation of Rs 75,000 was also directed to be paid while pendency of proceedings Section 20 before the trial court. Furthermore, 1/6th of the sale consideration received was directed to be deposited with the trial court. The petition was disposed of in such terms. [Shachi Mahajan v. Santosh Mahajan, 2019 SCC OnLine Del 6418, dated 10-01-2019]

Case BriefsHigh Courts

“Urgent need to get out of the preconditioned mind of the majority who unfortunately see Spas and Massage Centres as brothel houses.”

Madras High Court: The Bench of N. Anand Venkatesh, J. allowed a petition filed by a spa therapist against her illegal confinement and quashed cases filed against owners of massage and spa centres in Tamil Nadu.

The instant petition arises out of an FIR registered by respondent under Immoral Traffic (Prevention) Act, 1956, against the manager of Willows Spa citing petitioner – an Indonesian spa therapist working therein – as a victim of prostitution. Pursuant to a police raid at the said spa, petitioner along with four other spa therapists was taken into custody and confined in a government vigilance home for nearly 26 days without even being informed of the grounds of her confinement. Aggrieved thereby, she filed the present petition seeking compensation for violation of her personal liberty and loss of personal reputation.

The Court opined that banning of cross-gender massaging would not guarantee stoppage of illegal activity and urged to change pre-conceived notions about massage and spa centres. It observed that cross-gender massages is a worldwide phenomenon and held that the police had no legal right to prevent a health spa being operated by anyone even if therapy is done to persons of one sex by those belonging to the opposite sex.

It was noted that there was no proof of even a single incident of prostitution or activities of a prostitute in Willows Spa. No respectable inhabitant of the locality was called as a witness in the said case. The Indonesian Consulate was not informed about the incident and the same was in contravention of Office Memorandum No. 14051/14/2011-F.VI of the Ministry of Home Affairs.

The Court opined that the entire action of the police was illegal and a case of colourable exercise of power. If this power goes unchecked, spa centre or a massage parlour could be run only at the mercy of a police officer. For an extraneous consideration, the police can brand any spa as a brothel and even if a brothel is being run in the name of a spa, no action would be taken. Such a situation is neither good for the society nor the police force.

It was observed that every foreign national who comes to India should be treated like an ambassador of the concerned country as they carry with them their opinions and impressions about our country. Petitioner had come to India on a valid employment permit and an offered salary of $ 25,000 per year. She had hardly worked for three months when she suffered a horrific experience of being confined illegally in a government home for 26 days.

In view of the above, respondent’s FIR was quashed and petitioner was granted Rs 2,50,000 as compensation. [Kadek Dwi Ani Rasmini v. K. Natarajan, 2019 SCC OnLine Mad 23, decided on 02-01-2019]

Case BriefsTribunals/Commissions/Regulatory Bodies

National Consumer Disputes Redressal Commission (NCDRC): A Division Member Bench of Dr S.M. Kantikar, Presiding Member, Dinesh Singh, Member, dismissed a revision petition filed against the order of the State Commission, whereby the petitioner was ordered to pay compensation to the respondent for deficiency in services.

The main issue that arose before the Commission was whether the complaint filed by the respondent was within the period of limitation.

The Commission observed that the Consumer Protection Act, 1986 (COPRA) was enacted to provide an additional remedy to the consumer apart from other remedies available to them under different laws. The respondent herein was well within the ambit of “consumer” as per the provisions of COPRA and hence it had rightly approached the district forum for redressal of its grievances. The Commission further observed that Section 24A of the COPRA talks about the period of limitation in filing a complaint and it says that the complaint shall be filed within 2 years from the date on which the cause of action arose. It is pertinent to note that the instant case involved an issue of carriage by air and there is a separate enactment which governs the law related to carriage by air i.e. Carriage By Air Act, 1972 (1972 Act). Rule 30 of the Second Schedule of 1972 Act says that right to claim damages gets extinguished if an action is not brought against the erring party within 2 years from the date of arrival at the destination. Clearly in case if there arises a conflict between Section 24 A of the COPRA and Rule 30 of the 1972 Act, then Rule 30 shall prevail since the 1972 Act was enacted under Article 253 of the Constitution of India to implement an international convention.

The Commission held that as per the ruling of the Supreme Court in the case of Sahwney Export House (P) Ltd. v. Pakistan International Airlines, First Appeal No. 283 of 1992, the 1972 Act shall prevail over the provisions of COPRA if the case pertains to carriage by air and there is a question of limitation involved, even if the complaint is filed under the provisions of the COPRA. Resultantly, the Commission allowed the revision petition and set aside the order of the state commission.[Pakistan International Airlines v. Dar Trading Co., 2018 SCC OnLine NCDRC 458, order dated 03-12-2018]

Case BriefsSupreme Court

Supreme Court: A Bench comprising of N.V. Ramana and M.M. Shantanagoudar, JJ. allowed an appeal for enhancing the compensation awarded under Motor Vehicles Act, 1988 by the Kerala High Court.

The claimants were the dependants (wife, 2 children, and aged father) of the deceased who died in an accident in 2008. The moved a claim petition before the Motor Accidents Claim Tribunal seeking a total compensation of Rs 25,00,000. The Tribunal granted a compensation of Rs 11,83,000 which was enhanced by the High Court by an additional award of Rs 9,70,000. The claimants preferred the instant appeal for further enhancing the compensation.

The Supreme Court considered the salary certificate of the deceased, cost of living, and other relevant factors. It was held that the High Court was not right in deducting 2/3rd of the deceased’s total income towards his personal expenses and was of the view that a deduction of 40% would be appropriate for quantifying compensation. In the opinion of the Court, the claimants were entitled to a total compensation of Rs 28,00,000 which interestingly was higher than the amount claimed by the dependants of the deceased. Referring to Nagappa v. Gurudayal Singh, (2003) 2 SCC 274; Magma General Insurance v. Nanu Ram, 2018 SCC OnLine SC 1546 and Ibrahim v. Raju, (2011) 10 SCC 634, the Court observed, “There is no restriction that the Court cannot award compensation exceeding the claimed amount, since the function of the Tribunal or Court under Section 168 of the Motor Vehicles  Act, 1988 is to award ‘just compensation’. The Motor Vehicles Act is a beneficial and welfare legislation. A ‘just compensation’ is one in which reasonable on the basis of evidence produced on record. It cannot be said to have become time-barred. Further, there is no need for a new cause of action to claim an enhanced amount. The Courts are duty to award just compensation.”

The appeal was thus allowed and disposed of in terms above. [Ramla v. National Insurance Company Ltd.,2018 SCC OnLine SC 2616, decided on 30-11-2018]

Case BriefsTribunals/Commissions/Regulatory Bodies

Income Tax Appellate Tribunal, Mumbai (ITAT): A Bench comprising Saktijit Dey (JM) and Manoj Kumar Aggarwal (AM), allowed actor Sushmita Sen’s appeal against the order of Commissioner of Income Tax (Appeals), holding that the amount received in lieu of sexual harassment claim is not taxable.

The assessee who had received a sum of Rs 1.45 crores from Coca-Cola India Limited as a settlement amount for breach of celebrity engagement contract, submitted only Rs 50 lakhs out of the said amount to tax claiming the balance Rs 95 lakhs to be capital receipts. CIT(A) held that the payment received by assessee actor arose out of cancellation of the contract and did not affect the trading structure of her profession. The termination was a part and parcel of her profession not amounting to the loss of an enduring asset causing abrupt close down of her profession or dislocation of the capital structure of her profession earning apparatus. Therefore, the entire amount was held to be revenue receipts. Aggrieved thereby, the instant appeal was filed.

Submission on behalf of the assessee was that the full amount of Rs 1.45 crores was received as compensation for her sexual harassment by an employee of Coca-Cola. However, out of abundant caution, she considered a sum of Rs 50 lakhs due to her under the contract as her income and submitted the same for taxation.

The Tribunal, after appreciation of materials on record, found that in case of default by Coca-Cola, only Rs 50 lakhs was due to the assessee as per the terms of the contract. She had received Rs.1.45 crore out of which Rs 50 lakhs had been offered to tax. The balance amount of Rs 95 lakhs was received as a settlement in a sexual harassment claim. The appeal was allowed holding that since the said amount did not arise out of exercise of profession by the assessee, it could not be construed to be her income or profits and gains of profession within the meaning of Section 2(24) and Section 28 of the Income Tax Act, 1961.[Sushmita Sen v. CIT, Income Tax Appeal No. 4351/Mum/2015, decided on 14-11-2018]