When a person could not pay back his bank loan, the bank auctioned off the gold ornaments he had deposited as security. The state government asked the bank to pay sales tax on the amount but it refused. The bank contended that selling gold is not part of the banking business and, in this case, the ornaments were sold only to recover unpaid dues. This transaction, therefore, does not come within the ambit of “sale” so sales tax should not be levied. The Supreme Court, however, held that according to the Schedule of the Banking Regulation Act, banks are required to show income from non-performing assets and profit from the sale of such assets. As the sale of assets takes place in the course of the banking business, the bank is liable to pay sales tax, the court held (Federal Bank Ltd vs State of Kerala).
The Society of Marine Biology challenged the qualifications stipulated for recruiting people to teach fisheries science. The society was of the opinion that marine biology is equivalent to fisheries science and students of the subject should be allowed to apply for the post along with students of fisheries science and those with a postgraduate degree in industrial fisheries. Pointing out that fish processing technology was a part of fisheries science curriculum, Kerala High Court held that as those with degrees in marine biology had no exposure to fish processing, they could not be recruited as fisheries science teachers (Society of Marine Biology vs State of Kerala).
Liable for liability
After giving birth to a baby girl, a woman underwent a sterilisation operation. Soon after that, she found her baby missing. Although an FIR was immediately lodged, her baby could not be traced. She lodged a case against the hospital, asking for compensation. The hospital contended that it was the police’s job to find the baby and that they had done their duty by co-operating during investigations. The Supreme Court held that the hospital authorities could not escape liability for the incident and directed the hospital to pay the woman Rs 1 lakh along with interest from the date of filing the petition as compensation for the mental agony caused (Smt. M. Gita Devi vs Secretary Department of Health).