2010 (4) TMI 432 - SC - FEMA

Writ petitions not maintainable when efficacious remedy exists under Section 35 of FEMA; cannot bypass statutory appeal route

SC held the writ petition was not maintainable where an efficacious statutory remedy existed under Section 35 of FEMA. Allowing a writ despite ... Appeal to the High Court on a question of law - any decision or order of the Appellate Tribunal - writ jurisdiction under Article 226 - statutory remedy - self imposed limitations on exercise of Article 226 jurisdiction - efficacious remedy - pre deposit requirementAny decision or order of the Appellate Tribunal - appeal to the High Court on a question of law - Scope of Section 35 of FEMA - whether 'any decision or order' of the Appellate Tribunal includes interlocutory as well as final orders and therefore is appealable to the High Court on a question of law. - HELD THAT: - Section 35 confers a statutory right of appeal to the High Court 'from any decision or order of the Appellate Tribunal' on a question of law. The Court held that the word 'any' must be given its ordinary wide meaning in the absence of contrary statutory intent and, therefore, embraces all decisions or orders of the Tribunal. The right of appeal is a creature of statute and its ambit must be determined from the statutory language; where the statute does not restrict appeals to final orders alone, no judicial curtailment by interpretation is warranted. The Court illustrated this construction by reference to authorities on the meaning of 'any' and comparable statutory schemes where the statute expressly limits appeals to final orders; by contrast FEMA's Section 35 contains no such restriction and thus includes interlocutory orders subject to the limitation that appeals lie only on questions of law. [Paras 21, 23, 24, 29]Section 35 of FEMA permits appeal to the High Court against 'any decision or order' of the Appellate Tribunal on a question of law, and the expression includes interlocutory as well as final orders.Writ jurisdiction under Article 226 - statutory remedy - self imposed limitations on exercise of Article 226 jurisdiction - efficacious remedy - pre deposit requirement - Whether a writ petition under Article 226 is ordinarily maintainable to challenge an order of the Appellate Tribunal under FEMA when Section 35 provides an appellate remedy to the High Court. - HELD THAT: - FEMA constitutes a complete code with Chapter V (Sections 16-35) and attendant rules providing an integrated remedial scheme for adjudication and appeal. Where a statute creates a special remedy for enforcement of statutory rights or liabilities, that statutory remedy must ordinarily be invoked and the writ jurisdiction of the High Court should not be invoked to bypass the statutory machinery. Although Article 226/32 remain constitutionally available, their exercise is subject to well recognized self imposed limitations and to the legislative intent manifested in the statute. The Court applied precedents which hold that writ relief should not normally be entertained where an efficacious statutory remedy exists, except in exceptional circumstances such as complete lack of jurisdiction, breach of natural justice, or enactment being ultra vires; none of those exceptions was shown in the present case. Consequently, a writ petition impugning an order of the Tribunal declining dispensation of pre deposit was not ordinarily maintainable when Section 35 provides appeal to the High Court. [Paras 36, 38, 41, 49, 50]A writ petition under Article 226 challenging an order of the Appellate Tribunal under FEMA is not ordinarily maintainable where an efficacious statutory appeal to the High Court is available under Section 35; the statutory remedy should be invoked.Final Conclusion: The appeal is dismissed on the ground that a writ petition under Article 226 is not ordinarily maintainable to challenge an order of the Appellate Tribunal under FEMA; Section 35 affords an appeal to the appropriate High Court against 'any decision or order' of the Tribunal on a question of law (including interlocutory orders). The appellant is granted liberty to file an appeal before the appropriate High Court within thirty days, which forum is to consider limitation sympathetically in the circumstances. Issues Involved:1. Territorial Jurisdiction of the High Court2. Maintainability of Writ Petition under Article 226 against an order of the Tribunal3. Interpretation of Section 35 of the Foreign Exchange Management Act (FEMA)Issue-wise Detailed Analysis:1. Territorial Jurisdiction of the High Court:The High Court of Delhi dismissed the writ petition on the grounds of lack of territorial jurisdiction. The court relied on the decision in Ambica Industries v. Commissioner of Central Excise, interpreting Section 35 of FEMA. The court reasoned that a High Court must consider whether the person, authority, or government is located within its territories or if a significant part of the cause of action has arisen within its territories. The court emphasized that allowing litigants to choose any High Court based on convenience would lead to forum shopping and judicial anarchy.2. Maintainability of Writ Petition under Article 226 against an order of the Tribunal:The Supreme Court questioned the maintainability of the writ petition against an order of the Tribunal in view of Section 35 of FEMA. The appellant argued that the writ jurisdiction of the High Court is part of the basic structure of the Constitution and cannot be ousted by Section 35 of FEMA. However, the Supreme Court held that FEMA is a complete code in itself, providing a comprehensive network of provisions for adjudication and appeal. The court emphasized that when a statutory forum is created for redressal of grievances, a writ petition should not be entertained, ignoring the statutory dispensation. The court cited several precedents, including Thansingh Nathmal and others v. The Superintendent of Taxes, Dhubri, and Titaghur Paper Mills Co. Ltd. and another v. State of Orissa and Another, to support its view that the statutory remedy must be availed of before seeking discretionary relief under Article 226.3. Interpretation of Section 35 of FEMA:Section 35 of FEMA allows an appeal to the High Court from 'any decision or order' of the Appellate Tribunal on a question of law. The appellant contended that this section only applies to final orders. However, the Supreme Court clarified that the word 'any' in this context means 'all,' and thus, appeals can be filed against any order or decision of the Appellate Tribunal on a question of law. The court referenced various judgments to support this interpretation, including Beckett v. Sutton, Ellerine Bros. (Pty) Ltd. and Another v. Klinger, and Satyanarain Biswanath v. Harakchand Rupchand. The court also noted that other statutes, such as the Family Courts Act, 1984, and the Code of Civil Procedure, explicitly limit appeals to final orders, whereas FEMA does not impose such a limitation.Conclusion:The Supreme Court dismissed the appeal, holding that the writ petition was not maintainable as the appellant had an efficacious remedy under Section 35 of FEMA. The court directed that the appellant could file an appeal before the appropriate High Court within thirty days, and the appellate forum should consider the question of limitation sympathetically, given that the appellant was bona fide pursuing his case under Article 226 of the Constitution. The parties were left to bear their own costs.