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TaxTMI 
TaxTMI 
2023 (2) TMI 1244
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.... notice by email of today's listing. 2. This appears to be a fourth round of litigation by the Petitioner. It is a major supplier of Over Head Equipment to the Indian Railways. This equipment consists inter alia of copper conductors used in railway electrification. We are not entering into any larger controversy today since our objective is to test whether there is a case made out for urgent relief. Amongst the contracts that the Petitioner undertakes are contracts for the supply of jointless Hard Drawn Grooved Copper Contract Wire or HDGC wire. 3. On 22nd June 2018, the Petitioner had a contract for the supply of such HDGC wires. One of the components or raw materials for manufacturing HDGC wires are what are called CCC Rods. They compulsorily have to be purchased only from an approved supplier, one of which is HCL. To make the CCC Rods, Copper Cathodes are required raw materials. These have to conform to certain requirements of the London Metal Exchange and have to be a Grade A quality. HCL could not get the required Cathodes and therefore the Petitioner obtained these from Sumitomo Japan and supplied these Copper Cathodes to HCL so that it could manufacture....
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....aside: 1. the Impugned Show Cause Notice dated 2nd August 2022 (Exhibit "B" hereto); and 2. the Impugned Delisting Letter dated 10th November 2022 (Exhibit "A" hereto). (b) that this Hon'ble Court be pleased to issue a Writ of Mandamus or any other writ in the nature of Mandamus or any other appropriate writ, direction or order directing the Respondents and their officers and agents not to take any steps in any manner in furtherance of the Impugned Delisting letter dated 10th November 2022; (c) that without prejudice and in the alternative to prayers (a) and (g) and in the event that the Respondent authorities take the view that the Impugned Delisting Letter prevents the Petitioner from completing the existing contracts, this Hon'ble Court be pleased to issue a Writ of Certiorari or any other writ in the nature of Certiorari or any other appropriate writ, direction or order staying the operation, implementation and effect of the Impugned Delisting Letter dated 10th November 2022 in so far as it pertains to existing contracts." 4. The challenge is to a de-listing letter of 10th November 2022 at Exhibit "A" at page 79. The effect of it i....
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.... Mr. Doctor accepts that payment for the HDGC wires was actually made, but what was withheld related to the supply of HDGC wires which did not use CCC rods obtained from HCL. 12. On 30th March 2021, the Research Designs and Standards Organisation (RDSO), the 3rd Respondent, issued a notice de-listing the Petitioner for alleged job-work. 13. Apar Industries filed a Writ Petition on 22nd April 2021. This Court directed the Respondents to accept Apar Industries' bid for Railway tenders and not to award tenders until final disposal of Apar Industries appeal before the Appellate Authority. Time to dispose of the appeal was periodically extended and, in the meantime, Apar Industries was allowed to participate in all tenders, these not to be finalized. On 9th June 2021, the Appellate Authority confirmed the order of de-listing. Apar Industries filed a second Writ Petition challenging the Appellate Authority's order. That order was stayed by this Court. One of the reasons was that the show-cause notice did not indicate a proposed de-listing. It also noted that there was no quality defect, deficiency or deviation from quality. 14. In the meantime, in the arbitral proceeding....
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....one on the basis that there was indeed and in fact a deterioration in quality. Once the supply by Apar Industries was found to be non-conforming in quality, then it really would make no difference why that nonconformity took place. It could then perhaps be further attributed to the fact that Sumitomo copper cathodes were being supplied to HCL. But this is a factual determinant, and it cannot be left to the realm of speculation, conjecture and surmise. 21. The other factual aspect is that the prohibition against job-work was actually introduced in the year 1st January 2021. The RDSO (the 3rd Respondent) specifications in force prior to that date did not contain such a prohibition. 22. Strangely, the impugned order makes reference in its subject line to these RDSO specifications with effect from 1st January 2021 but applies them to supplies made between 2019 and 2020. That could never have been done. 23. Lastly on the factual aspect of the matter, the following points must be kept in mind. (a) The copper cathodes from Sumitomo were inspected and found to conform to the necessary London Metal Exchange Standards. (b) The CCC rods manufactured by HCL using the....
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....relevant to what he has to consider. If he does not obey those rules, he may truly be said, and often is said, to be acting 'unreasonably'. Similarly, there may be something so absurd that no sensible person could even dream that it lay within the powers of the authority. ... In another, it is taking into consideration extraneous matters. It is unreasonable that it might almost be described as being done in bad faith; and in fact, all these things run into one another." ... "... it must be proved to be unreasonable in the sense that the court considers it to be a decision that no reasonable body can come to. It is not what the court considers unreasonable. ... The effect of the legislation is not to set up the court as an arbiter of the correctness of one view over another." 26. In Council of Civil Service Unions v. Minister for the Civil Service, [1983] UKHL 6 : [1984] 3 All ER 935 : [1984] 3 WLR 1174 Diplock LJ for the House of Lords spoke of 'irrationality' in these words: By 'irrationality' I mean what can by now be succinctly referred to as Wednesbury unreasonableness. It applies to a decision which is so outrageous in its ....
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.... 17. So far as the doctrine of proportionality is concerned, there is no gainsaying that the said doctrine has not only arrived in our legal system but has come to stay. With the rapid growth of administrative law and the need and necessity to control possible abuse of discretionary powers by various administrative authorities, certain principles have been evolved by courts. If an action taken by any authority is contrary to law, improper, irrational or otherwise unreasonable, a court of law can interfere with such action by exercising power of judicial review. One of such modes of exercising power, known to law is the "doctrine of proportionality". 18. "Proportionality" is a principle where the court is concerned with the process, method or manner in which the decision-maker has ordered his priorities, reached a conclusion or arrived at a decision. The very essence of decision-making consists in the attribution of relative importance to the factors and considerations in the case. The doctrine of proportionality thus steps in focus true nature of exercise--the elaboration of a rule of permissible priorities. ... 21. The doctrine has its genesis in th....
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.... me to be unnecessary and confusing.' and in the Daly case [R. v. Secy. of State for the Home Deptt., ex p Daly, (2001) 3 All ER 433 (HL)] Lord Cooke said: 'I think that the day will come when it will be more widely recognised that Associated Provincial Picture Houses Ltd. v. Wednesbury Corpn. was an unfortunately retrogressive decision in English administrative law, insofar as it suggested that there are degrees of unreasonableness and that only a very extreme degree can bring an administrative decision within the legitimate scope of judicial invalidation.' Although quoting and sympathising with these weighty opinions, and acknowledging that 'the Wednesbury test is moving closer to proportionality', the Court of Appeal has held that 'it is not for this Court to perform the burial rites'. That task must be left to the House of Lords, and meanwhile the law as laid down by the House in Brind case [R. v. Secy. of State for the Home Deptt., ex p Brind, (1991) 1 AC 696 : (1991) 1 All ER 720 : (1991) 2 WLR 588 (HL)], in which proportionality was rejected as part of English law, must linger on. Lord Irvine, L.C. has, however,....