1998 (1) TMI 295 - HC - Central Excise

High Court Jurisdiction over Tribunal Orders: Chandra Kumar Principle Applies

The Court concluded that the Supreme Court judgment in L. Chandra Kumar v. Union of India applies to all Tribunals, including CEGAT, as the power of ... Judicial review of Tribunal’s orders - Writ jurisdiction against CEGAT orders Issues Involved:1. Whether the Supreme Court judgment covered the CEGAT also.2. Whether this Court was incompetent to judicially review the orders passed by the CEGAT at Delhi.3. Whether the two writ petitions were liable to be rejected because of the availability of an alternate statutory remedy under Section 35L of the Excise Act.Issue-wise Detailed Analysis:1. Whether the Supreme Court judgment covered the CEGAT also:The central controversy revolves around the applicability of the Supreme Court's judgment in L. Chandra Kumar v. Union of India to the Customs, Excise and Gold (Control) Appellate Tribunal (CEGAT). The respondents argued that the Supreme Court judgment was limited to Tribunals established under Articles 323A and 323B of the Constitution, and since CEGAT was created under the Customs Act and the Central Excise Act, it was outside the purview of this judgment. The petitioners countered this by emphasizing that the Supreme Court had declared the power of judicial review under Articles 226/227 as part of the basic structure of the Constitution, which applies to all Tribunals, irrespective of their origin. The Court concluded that the power of judicial review vested in the High Courts under Articles 226/227 extends to all Tribunals, including CEGAT, as it forms a basic feature of the Constitution. This interpretation was supported by the language in paragraphs 91 and 92 of the Chandra Kumar judgment, which underscored that all decisions of Tribunals would be subject to the High Court's writ jurisdiction.2. Whether this Court was incompetent to judicially review the orders passed by the CEGAT at Delhi:The respondents argued that only the Delhi High Court had jurisdiction to review CEGAT's orders because its headquarters were located in Delhi. The petitioners refuted this by pointing out that the Supreme Court judgment did not restrict jurisdiction to the location of the Tribunal's headquarters. Instead, the term 'territorial jurisdiction' should be interpreted in the context of Article 226(1) and (2), which allows High Courts to issue writs if the cause of action arises within their territorial limits. The Court agreed with the petitioners, stating that the High Court's jurisdiction under Article 226 extends to any person or authority within its territorial limits if the cause of action arises there. Additionally, the CEGAT Notification No. 5/95, dated 31-5-1995, placed Madhya Pradesh within the territorial jurisdiction of its Northern Bench, allowing it to hold sittings in Madhya Pradesh. Therefore, the M.P. High Court was competent to review the CEGAT's orders.3. Whether the two writ petitions were liable to be rejected because of the availability of an alternate statutory remedy under Section 35L of the Excise Act:The respondents contended that the writ petitions should be dismissed due to the availability of an alternative statutory remedy under Section 35L of the Excise Act, which provides for an appeal to the Supreme Court. The petitioners argued that the Supreme Court had effectively excluded direct appeals under Section 35L, instead providing for an appeal by special leave under Article 136 against the orders of the High Court's Division Bench. The Court noted that the rule of exhausting statutory remedies is a matter of policy and does not bar the Court's jurisdiction. It is well established that where a Tribunal acts outside its jurisdiction or contrary to natural justice, the plea of an alternative remedy becomes irrelevant. Moreover, the remedy under Section 35L is restrictive and not efficacious enough to oust the writ jurisdiction. Consequently, the availability of an alternative remedy under Section 35L did not bar the maintainability of the writ petitions.Conclusion:The Court overruled the respondents' preliminary objections and held that CEGAT is subject to the writ and supervisory jurisdiction of the High Court under Articles 226/227. The M.P. High Court was competent to entertain the writ petitions against CEGAT's orders, even though they were passed at its New Delhi headquarters. The alternative statutory remedy under Section 35L did not preclude the maintainability of the writ petitions. The registry was directed to post the writ petitions for further proceedings before an appropriate Bench.