2003 (12) TMI 55 - SC - Customs

Supreme Court rules rewards discretionary, no legal right to claim specific amount

The Supreme Court allowed the appeal by the Union of India, setting aside the High Court's orders and dismissing the writ petition. The respondent's ... Ex-gratia payment - reward to informer - discretion of competent authority - non-retrospective application of amended policy - writ of mandamus - requirement of statutory dutyEx-gratia payment - reward to informer - discretion of competent authority - Whether the informer had a legal right to claim the balance amount of reward as a matter of right and whether the High Court could issue a writ of mandamus directing payment of a quantified ex-gratia reward. - HELD THAT: - The scheme dated 30-3-1985 treats reward as an ex-gratia payment to be granted at the absolute discretion of the competent authority having regard to multiple evaluative factors (specificity and accuracy of information, risk undertaken, nature of help, whether perpetrators were apprehended, etc.). The Court held that no legal right to claim a reward accrues as such and that the High Court erred in issuing a writ of mandamus to compel payment of a specified amount. A mandamus lies only to enforce a statutory duty; where payment is ex-gratia and discretionary, there is no statutory obligation to be compelled. The writ petition failed to furnish the requisite particulars to enable judicial weighing of the discretionary factors which are within the exclusive domain of the Department, and the High Court's peremptory directions for payment were therefore unwarranted. [Paras 12, 13, 14]The respondent had no legal right to claim the reward as a matter of right and the High Court wrongly issued a writ of mandamus directing payment of a quantified ex-gratia amount; the writ petition is dismissed on this ground.Non-retrospective application of amended policy - reward to informer - Whether the amended reward guidelines of 30-3-1989 (requiring final reward to be paid only after actual realisation of duty/penalty/fine) applied to the respondent's claim which was first made after the Collector's order dated 5-3-1993. - HELD THAT: - The Court applied settled principle that an ex-gratia scheme does not give rise to a vested right protectable against subsequent amendments; reward entitlement must be considered in terms of the policy in force when the claim is considered. The respondent first pressed his claim in 1993 after adjudication, at which time the 1989 amendment was in force. Therefore the amended guidelines governed the respondent's entitlement. Moreover, factual material showed that except for a single redemption fine of Rs. 2 lakhs no other amounts had been realised, limiting any entitlement under the amended policy. The High Court's reliance on the pre-1989 policy and direction to pay additional sums was therefore legally unsustainable. [Paras 10, 11, 14]The 1989 amendment applied to the respondent's claim made in 1993; the High Court erred in applying the earlier policy and in directing payment contrary to the amended guidelines.Final Conclusion: The appeals by special leave are allowed; the High Court orders directing payment of further reward are set aside and the writ petition is dismissed, and the respondent's cross-appeal is dismissed. Issues Involved:1. Entitlement to reward for providing information on customs duty evasion.2. Applicability of guidelines for reward payment.3. Legitimacy of issuing a Writ of Mandamus for reward payment.Issue-wise Detailed Analysis:1. Entitlement to Reward for Providing Information on Customs Duty Evasion:The respondent filed a writ petition claiming a reward for providing information about customs duty evasion by M/s. Sanjeevani and M/s. FOMETA. The information led to the confiscation of goods and imposition of penalties. The learned Single Judge acknowledged that the respondent provided the information leading to the seizure and adjudication proceedings, entitling him to a reward. However, the counter-affidavit from the Department did not admit that the investigation was solely based on the respondent's information. The High Court's decision was based on the assumption that the respondent's information was crucial, but this was not substantiated.2. Applicability of Guidelines for Reward Payment:The Union of India argued that the amended guidelines of 30-3-1989, which state that rewards should be paid only after actual realization of duty, fine, and penalty, should apply. The High Court held that the revised guidelines could not be applied retrospectively and that the original guidelines of 30-3-1985 should govern the reward payment. However, the Supreme Court found this view erroneous. It emphasized that the claim for reward was made in 1993, and thus, the guidelines in force at that time, which were the amended guidelines of 1989, should apply. The Supreme Court referenced Union of India v. R. Padmanabhan, asserting that rewards being ex-gratia payments are subject to the guidelines in force at the time of consideration and actual grant.3. Legitimacy of Issuing a Writ of Mandamus for Reward Payment:The Supreme Court highlighted that a Writ of Mandamus can only be issued where there is a statutory duty imposed by law. Since the reward is an ex-gratia payment and not a statutory right, no Writ of Mandamus can compel the payment of a specific amount as a reward. The guidelines clearly state that rewards are at the absolute discretion of the competent authority and cannot be claimed as a matter of right. The High Court's directive to pay a quantified amount was thus legally unsustainable, as it overstepped the discretionary nature of reward payments.Conclusion:The Supreme Court allowed the appeal by the Union of India, setting aside the High Court's orders and dismissing the writ petition. The respondent's appeal was also dismissed, affirming that rewards are discretionary and subject to guidelines in force at the time of consideration, with no legal right to claim a specific amount. The case underscores the principle that ex-gratia payments like rewards cannot be mandated through judicial orders unless there is a statutory obligation.