Court Mandates Committee on Disputes Approval for Bank Appeals

The court ruled in favor of the requirement for a public sector bank to obtain approval from the Committee on Disputes (COD) before pursuing an appeal. Emphasizing the importance of COD clearance, the court set a deadline for the bank to seek approval within one month of filing the appeal. Additionally, the judgment highlighted the judicially evolved practice of utilizing Alternative Disputes Resolution (ADR) mechanisms to resolve disputes before litigation, as mandated by a Supreme Court order. Non-granting of clearance by the COD was deemed to result in dismissal of the appeal, underscoring the mandatory nature of seeking prior clearance for litigation.

---

---

Issues:
1. Requirement of approval from the Committee on Disputes (COD) for pursuing an appeal by a public sector bank.
2. Judicially evolved practice of referring disputes to an Alternative Disputes Resolution (ADR) mechanism.
3. Mandate for obtaining clearance from the High-Powered Committee (now COD) before litigation.
4. Consequences of non-granting of clearance by the COD.
5. Mandatory nature of prior clearance by COD for litigation.

Analysis:
1. The judgment involves the appeal by a public sector bank against the Tribunal's decision for the assessment year 1995-96. The bank, as a public sector undertaking, is required to obtain approval from the Committee on Disputes (COD) for pursuing the appeal, as stated in the memorandum of appeal. The court acknowledges the need for COD clearance and sets a deadline for the bank to seek approval within one month from the filing of the appeal.

2. The court delves into the judicially evolved practice of referring disputes between government branches or between the government and public sector undertakings to an Alternative Disputes Resolution (ADR) mechanism. This practice aims to resolve disputes amicably before resorting to litigation, as mandated by a Supreme Court order. The court emphasizes the importance of exploring ADR processes before taking disputes to court or a tribunal.

3. The judgment highlights the mandate for obtaining clearance from the High-Powered Committee, now known as the Committee on Disputes (COD), before initiating litigation. It cites a Supreme Court order that outlines the procedure for approaching the COD for clearance, emphasizing the suspension of proceedings until the COD resolves the dispute or grants clearance for litigation.

4. The consequences of non-granting of clearance by the COD are discussed in the judgment, citing a case where the Supreme Court clarified that if COD clearance is not obtained, the appeal cannot be entertained and should be dismissed as not maintainable. The court underscores the role of the COD in preventing frivolous litigation and ensuring fair decisions.

5. The judgment reiterates the mandatory nature of prior clearance by the COD for litigation, emphasizing that if clearance is refused, the party seeking to litigate must abide by it. The COD is expected to decide definitively on whether to grant clearance or refuse permission for litigation, without keeping the party in suspense. The court sets a deadline for the appellant to report on the application made to the COD, emphasizing compliance with the Supreme Court's directive on seeking COD clearance within a stipulated timeframe.

---