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M J Antony: Package insurance policy for honchos

Source : BUSINESS_STANDARD
Last Updated: Sun, Nov 25, 2012 19:21 hrs
​life insurance

An executive going in the company car is entitled to compensation in a road accident only if the vehicle is insured under the 'package policy', earlier known as comprehensive policy. The Supreme Court last week rejected the argument of National Insurance Company that it was not liable to indemnify the managing director of a company who was injured in an accident while riding the company car. The insurer contended that the policy taken by the company did not cover the executive as he was not a 'third party' under the policy. The tribunal found that the accident was caused by the rash and negligent act of the driver and the executive was awarded Rs 9 lakh in damages. The insurer appealed to the Madras High Court arguing that the executive was a non-fare passenger and no extra premium was paid to indemnify him. The high court rejected that also. The Supreme Court remitted the case to the tribunal to check the details of the policy, which was not available. If it is a package policy, the executive will be entitled to compensation from the insurance company.

Cheque bounce complaint valid

The Supreme Court ruled last week that a complaint of bounced cheque need not be signed in the first instance, but can be verified later before the magistrate. The Supreme Court rejected the argument of the accused person that the complaint against him was not signed and therefore not valid. He had sent 57 cheques as payment for supplying yarn by Reliance Industries. They were returned by the bank with the remark, "exceeds arrangement". The metropolitan magistrate recorded the verification statement and issued summons against the accused. He challenged it in several courts without success. The Supreme Court said in its judgment in the case, Indra Kumar vs RIL: "The complaint under Section 138 of the Negotiable Instruments Act without signature is maintainable when such complaint is verified by the complainant and the process is issued by the magistrate after due verification."

RBI objects to revival scheme

A division bench of the Delhi High Court last week set aside the judgment of the company judge in a petition moved by Reserve Bank of India, SEBI and others in the matter of CRB Capital Market Ltd and remitted the matter to the company court for consideration of the winding-up of the company. The company judge had sanctioned the revival scheme in the interest of depositors. However, RBI moved the division bench against the decision. It ruled that the scheme as sanctioned by the company court contravened the provisions of the RBI Act. It added that though a scheme can be envisaged in the course of a winding up petition under the RBI Act it has to be in conformity with the provisions of law. "We feel that the scheme as formulated in the present case is not bona fide, feasible or fair," the judgment said. RBI had vehemently contended that during the pendency of a winding up petition under the RBI Act no scheme under the Companies Act could be propounded or considered.

Geo indication of 'divine' ring

The Intellectual Property Appellate Tribunal has asked the Geographical Indication Registry to reconsider the issue of a hand-made finger ring made of gold and silver originating in a small town in Kerala. The Geographical Indication identifies and indicates the manufactured goods as originating in Payyannur. The geographical indication was "Payyannur Pavithra Ring". An association of local artisans was granted the registration. However, a jewellery firm opposed the registration, and argued that the history of the ring as provided by the association was false and gave another 18th century genesis to the ring. It also submitted that the ring was of divine significance and should not be commercialised, monopolised or patented. However, the registrar rejected the objections. The appellate board found that the artisans were not aware of the controversy. Therefore, the registrar was asked to publish the issue in a language newspaper with wide circulation. The board also asked the lawmakers to consider introducing a provision, as in the Land Acquisition Act, which requires each applicant to publish the intention so that people are made aware of the move for geographical indication registration.

'Judgment must disclose reasons'

The National Consumer Commission has asked the Rajasthan state consumer commission to reconsider its "cryptic" judgment as it has not given reasons for its conclusions. In this case, Standard Chartered Bank vs Himanshu Sharma, the complaint was about arbitrary and unilateral imposition of late charges/penalties. The district forum asked the bank to return the amount with interest and awarded Rs 50,000 as compensation. The bank appealed to the state commission, which dismissed the petition without giving reasons. The national commission stated that reasons were important and asked the state commission to hear all parties again and deliver a detailed judgment.


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