1994 (1) TMI 88 - SC - Central Excise

High Power Committee required for Union-SOE disputes; appeals filed without clearance must be referred and are stayed pending resolution

SC held that a High Power Committee was instituted to resolve disputes between the Union and state-owned enterprises to avoid costly litigation. Appeals ... Clarifications required regarding the setting-up and functioning of the High Power Committee for resolving disputes between Union of India on the one hand and its Public Sector Undertakings on the other - misconceptions arising out of the memo of the Cabinet Secretariat - HELD THAT:- The purpose of setting up this High Power Committee was to ensure that as far as possible, the controversies between a Ministry and a Ministry of the Government of India, a Ministry and a Public Sector Undertaking of the Government of India and between Public Sector Undertakings themselves are resolved by recourse to the High Power Committee and that time consuming and expensive litigation is avoided. Wherever appeals, petitions etc. are filed without the clearance of the High Power Committee, so as to save limitation, the appellant or the petitioner as the case may be, shall within a month from such filing, refer the matter to the High Power Committee with prior notice to the Designated Authority in Cabinet Secretariat of Government of India authorised to receive notices in that behalf. Sri. K.T.S. Tulsi, learned Additional Solicitor General, stated that in order to coordinate these references of the High Power Committee the Government proposes to nominate the Under Secretary (Coordination) in the Cabinet Secretariat as the nodal authority to coordinate these references. The reference shall be deemed to have been made and become effective only after a notice of the reference is lodged with the said nodal authority. The reference shall be deemed to be valid if made in the case of the Union of India by its Secretary, Ministry of Finance Department of Revenue, and in the case of Public Sector Undertakings by its Chairman, Managing Director or chief Executive, as the case may be. It is only after such reference to the High Power Committee is made in the manner indicated that the operation of the order or proceedings under challenge shall be suspended till the High Power Committee resolves the dispute or gives clearance to the litigation. If the High Power Committee is unable to resolve the matter for reasons to be recorded by it. It shall grant clearance for the litigation. The High Power Committee shall submit a half yearly report--- instead of quarterly report as earlier indicated---to this Court as to the number of matters referred to it and the manner in which they were dealt with and disposed of. The report for the half-year ended 31st December, 1993 shall be lodged before 31st January, 1994 and for every half year thereafter within one month of the expiry of the half year. Issues:Clarifications required regarding the functioning of the High Power Committee for resolving disputes between Union of India and its Public Sector Undertakings.Analysis:The Supreme Court addressed the need for clarifications regarding the functioning of the High Power Committee established to resolve disputes between the Union of India and its Public Sector Undertakings. The purpose of the Committee was to facilitate the amicable resolution of controversies to avoid costly and time-consuming litigation. It was clarified that the Committee's role was not to eliminate statutory remedies available to the Union of India and its corporations but to ensure that disputes are first examined by the Committee before proceeding to court or tribunal. The Committee consisted of representatives from various ministries to monitor and resolve disputes effectively.The Court emphasized that all disputes, including pending matters before any court or tribunal, should be referred to the High Power Committee within a month for expeditious resolution. While parties were not barred from filing appeals or petitions before courts or tribunals to save limitation, clearance from the High Power Committee was mandatory before proceeding. Any court or tribunal where a dispute was raised had the obligation to demand clearance from the Committee; otherwise, proceedings would not continue.In cases where appeals or petitions were filed without the Committee's clearance, the matter must be referred to the Committee within a month of filing. The Government proposed the nomination of a nodal authority in the Cabinet Secretariat to coordinate these references. The operation of any order or proceedings under challenge would be suspended until the High Power Committee resolved the dispute or provided clearance for litigation. The Committee was required to submit a half-yearly report to the Court detailing the matters referred and their resolutions.Overall, the judgment aimed to streamline the resolution process for disputes between the Union of India and its Public Sector Undertakings by ensuring the mandatory involvement of the High Power Committee before resorting to litigation, thus promoting efficient and effective dispute resolution mechanisms.