| MP to amend labour laws |
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Bhopal, 20 July Madhya Pradesh Labour Minister Antar Singh Arya said on Sunday the state government would amend certain provisions in the labour law to " maintain harmony between labourers and employers" in the state. The labour department on Sunday announced various awards and scholarships for labourers, their children, and employers, too. Besides, the state government would soon constitute aboard for workers in the unorganised sector in both rural and urban areas. While the labour minister did not disclose which of the labour laws would be amended, experts feel the Madhya Pradesh Industrial Relations Act 1960, which in its present form has stringent provisions, could be the one the government is planning to amend. Notably, in most cases, disputes arise out of violation of this Act. According to the annual report tabled in the state Assembly recently by the labour department, there were as many as 10 strikes by workers during 2013- 14 ( till December 2013) in the state. The number of strikes was four during 2009- 10, six during 2010- 11, eighteen during 201112, and 20 during 2012- 13. Arya said on various occasions such as the Global Investors Summit, employers, particularly in the private- sector, had demanded that the age- old labour laws be amended to reflect the current reality as well as the dynamics of the market. The minister said a change in labour laws would help " both labourers and the employers". Private- sector jobs are crucial because it is not possible to give government jobs to everyone, Arya added. "Scholarships to sons and daughters of labourers as well as recognition to employers have been initiated for the first time. It would help strengthen employer- labourer relations further," he noted. Muktesh Varshney, principal secretary in the labour department, observed that there have been cases of employers encroaching upon the financial and other securities of the labourers. This will not be allowed, he said, adding that the government would do everything to avoid situations that create dispute between employers and labourers. Business chambers such as Madhya Pradesh Laghu Udyog Sangh, Confederation of Indian Industry, Mandideep Industries Association, Govindpura Industries Association, Madhya Pradesh Textile Industry Association, etc, have oft- repeated the demand to maintain minimum wages at par with those of other states. For full reports, visit www. business- standard. com |
| Insurers can't escape compensation by apologising |
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Jimmy Bharucha was insured under a Parivar Mediclaim Policy of National Insurance Company. The policy, for a sum insured of ₹ 2 lakh, incepted on February 27, 2007. It was renewed with every year without break. In the fifth year of the health insurance policy, that is, between February 27, 2011 and February 26, 2012, Bharucha developed certain symptoms ( in May- June 2011), later diagnosed as coronary heart disease. In August 2011, he underwent an angioplasty at Hinduja Hospital. The total expenses came to ₹ 2.25 lakh. Since the expenses exceeded the sum insured, Bharucha restricted his claim to the sum insured of ₹ 2 lakh. Heritage Health TPA ( third party administrator), which processed the claim, rejected it on the ground that the medical history disclosed hypertension and diabetes for the previous 10 years. So it was not payable during the fourth year of the policy. Though Bharucha pointed out that the policy was in its fifth year and the claim was payable, no heed was paid to his representation. Bharucha filed a consumer complaint before the South Mumbai District Forum, alleging deficiency in service and unfair trade practice. While the TPA did not bother to contest the complaint, the insurance company admitted the claim had been wrongly repudiated. But it added a twist by alleging the claim file had been returned to Bharucha, and so it was unable to process the claim but could not produce any evidence to support this statement. Later, during arguments, the insurance company added another twist by stating the maximum amount payable was 50 per cent of the sum insured. So, the insurer was willing to settle the claim by paying ₹ 1 lakh. SG Chabukswar, delivering the judgement on behalf of the bench along with Presiding Officer S M Ratnakar rejected this contention. The Forum noted 50 per cent of the sum insured was applicable only to claims arising during the inception year of the policy. Since the claim had arisen in the fifth policy period, the Forum ruled the 50 per cent clause was not applicable. The claim could extend to the entire sum insured. The Forum accordingly held the claim amount would be payable to the extent of the sum insured, and directed the insurance company to pay Bharucha ₹ 2 lakh, along with nine per cent interest from the date of repudiation. The Forum observed that merely an apology from the insurance company would not absolve it of its liability to compensate the consumer. It awarded ₹ 10,000 as compensation for physical and mental harassment. Another ₹ 3,000 was awarded towards costs. It is time the grievance cells of the insurance companies realise they have to play a meaningful role. They should function effectively by looking into consumer grievances, rather than act in a mechanical fashion without application of mind. This would save the insurance company from the liability to pay compensation and avoid harassment to the consumer. The author is a consumer activist CONSUMER IS KING JEHANGIR GAI |
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| BRIEF CASEN [1] M J ANTONY | |
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The Supreme Court has held that a company which takes over another is liable to pay damages for default in payment of contributions to the provident fund committed by the latter. The damages is punitive in nature and it could be recovered from the transferee employer, the court held in the judgment, Mcleod Russel India vs Regional PF Commissioner, Jalpaiguri. In this case, Saroda Tea Company defaulted in payment of PF contributions. Later it was taken over by Eveready Industries, later named Mcleod Russel. According to the take- over agreement, the Mcleod cleared all PF arrears of the tea company. However, it contested the imposition of penalty for the default of the tea company. It pointed out the agreement in which the damages was the liability of the tea company. The Calcutta High Court rejected the argument. On appeal, the Supreme Court upheld the high court view and underlined that even if there was such an agreement, the liability was that of the new employer. The court asked the company to pay interest on the damages also. >>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>> Director can't be tried without company Prosecution of a director of a company for issuing a cheque which bounces cannot be sustained if the company is not made a party, the Supreme Court has ruled while setting aside the decision of the Delhi High Court in the case, Anil Gupta vs Star issued three cheques to Star India, which bounced. It filed criminal complaints under Section 138 and 141 of the Negotiable Instruments Act to the distributing company and the director. They moved the high court to quash the complaint on the ground of limitation. The high court quashed the complaint against the company but allowed the prosecution of the director, though he had argued that he was only vicariously liable for the default. He moved the Supreme Court. It relied upon earlier decisions and emphasised that proceedings against a director cannot be continued in the absence of the company. >>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>> Pre- deposit rule doesn't bar order to pay The Supreme Court has ruled that the National Consumer Commission can direct a company which appeals against the state commission order to deposit half of the decreed amount as acondition to hear the appeal. The Consumer Protection Act has a similar that the statutory provision was different from the power of the commission to pass interim order. The statutory provision was a condition precedent to entertain an appeal. The commission can pass interim order on the basis of the merit of the appeal during the proceeding, the court explained. Several companies against whom state commissions had passed awards for deficiency in service and unfair trade practices moved the National Commission to set aside the orders. The National Commission ordered that they must first deposit half the amount decreed by the state commissions. The companies moved the appeals, titled Shreenath Corp vs Consumer Education and Research Society, against the order. The Supreme Court dismissed all of them. >>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>> Creditor can stand outside revival plan The Delhi High Court has ruled that neither the Board for Industrial and Financial Reconstruction ( BIFR) nor the Appellate Authority for Industrial and Financial Reconstruction ( AAIFR) can compel a bank to join or continue in a recovery scheme for a sick company. A creditor bank can opt out of the scheme and realise outstanding dues from the company according to law, the judgment in the case, Indusind Bank Ltd vs ITI Ltd said. The order of the appellate authority to the bank to continue in the consortium of creditor banks set up to revive the firm was set aside. The company had approached BIFR following which the board set up the consortium. It set up an operating agency headed by State of Bank of India to revive the company, according to the Sick Industrial Companies Act. Indusind Bank was reluctant to join the consortium. But it was compelled by AAFIR by an order. The bank appealed to the Supreme Court arguing that no one can be compelled to enter into a contract without one's consent and that participation in the consortium agreement as a creditor has to be based upon volition and not compulsion. The Supreme Court accepted this contention. >>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>> Injunction against trade name The Bombay High Court has passed an injunction against Twilight Mercantile Ltd in a trade mark petition moved by Medley Pharmaceuticals Ltd alleging violation of trade names of its medicines. Medley is manufacturing medicines with the trade names O2 and OTwo. The other company introduced a medicine with the brand name O2B. On the application of Medley, the court found that the names were bound to be confusing because they were " phonetically, visually and structurally similar." Therefore, Twilight was barred from " exhibiting for sale and advertising pharmaceutical and medicinal preparation under the trade mark O1B and or O1B" PLUS till the issues are finally decided. >>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>> Gratuity payment can be stopped The Calcutta High Court held last week that service regulations of a public sector bank will override the provisions of the Payment of Gratuity Act. The court set aside the decision to the contrary of the controlling authority under the Act in its judgment, United Bank of India vs north India was terminated for sanctioning loans violating norms and causing losses to the tune of ₹ 26 crore. His services were terminated and gratuity forfeited though the disciplinary proceedings continued. The bank's view was that under the service regulations, the employer would be entitled to forfeit the damage suffered out of the amounts payable towards gratuity. The labour commissioner and the controlling authority under the Act ruled that gratuity cannot be denied as the main Act will prevail over the regulations. They maintained that the statute was a beneficial legislation and therefore, any regulation inconsistent with the object of the Act was not valid. The high court ruled that they were wrong. It explained that according to the 1970 law taking over and establishing the public sector bank, the regulations were specifically framed by the Board of Directors. " It is a special piece of subordinate legislation which because of their very special nature must give pre- eminence and precedence over the general principal or any general provision of law covering the same field. All that the court is required to find that in such a situation, the subordinate legislation is not overreaching or overstepping the principal Act." A weekly selection of key court orders | |
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