TaxTMI 
TaxTMI 
1997 (2) TMI 115
X X X X Extracts X X X X
X X X X Extracts X X X X
....(`CEGAT' for short) the order passed by the Additional Collector of Customs, Bombay dated 5th June, 1989 agreeing with the notings made by the Assistant Collector of Customs dated 31st May, 1989 recommending release of the imported goods to the common appellant on payment of full customs duty. The CEGAT took the view that Respondent No. l in both these appeals had no locus standi to prefer appeals against the said order. The High Court of Delhi by the impugned judgment has taken a contrary view and has ruled in favour of the locus standi of these respective respondents. 2.Before we deal with the aforesaid question it will be necessary to note the relevant background facts leading to the present controversy between the parties. They project a chequered history. The common appellant, Northern Plastics Ltd., which will hereinafter be referred to as `the appellant' for the sake of convenience, is said to have obtained Small Scale Industries Registration (SSI Registration) on 24th August, 1985 for slitting and confectioning of jumbo rolls of various types of films. The registration, according to the appellant, was obtained under the Industries (Development & Regulation) Act, 19....
X X X X Extracts X X X X
X X X X Extracts X X X X
....aforesaid period worked up to Rs. 572 lacs according to the appellant. The Assistant Collector of Customs (Bombay) had not granted the requisite relief of concessional import duty payable for the imported consignments of the appellant. Hence a writ petition being Civil Writ Petition No. 2021 of 1988 was moved by the appellant in the High Court of Delhi where principal relief sought was for the grant of benefit of the aforesaid customs exemption notification. A prayer was also made for issuance of COB licence by the competent authorities under the IDR Act. Initially the appellant had not joined M/s. `HPF', a public sector undertaking in the said writ petition as a respondent as it was merely a business rival of the appellant. However on an application by the HPF a Division Bench of the High Court by its order dated 8th May, 1989 allowed it to be a party respondent in the appellant's petition. In the aforesaid writ petition filed by the appellant before High Court of Delhi initially an order was passed by a learned Single Judge directing removal and release of the jumbo rolls imported by the appellant at Bombay at concessional rate of customs duty. However this interim order ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ed as withdrawn by this Court. After HPF's Special Leave Petition was dismissed as withdrawn by this Court on 27th June, 1989 a writ appeal was moved by the HPF before a Division Bench of the Bombay High Court against the order of learned Single Judge refusing to grant ex parte stay in writ petition of HPF, but no interim relief was granted by the High Court even in this writ appeal. Under these circumstances HPF filed an appeal to CEGAT on 28th June, 1989 against the order of Additional Collector of Customs (Bombay) dated 5th June, 1989. An ex parte interim order was obtained from CEGAT for a week up to 6th July 1989. HPF then withdrew the writ petition before the Bombay High Court. In the meantime the status quo order granted by CEGAT expired on 6th July, 1989 and it was not extended. HPF then filed a writ petition before the High Court of Delhi being Writ Petition No. 1932 of 1989 against the order dated 7-7-1989 passed by CEGAT and the Division Bench of the High Court passed an ex parte stay of the order of the Additional Collector of Customs dated 5th June, 1989 on 12th July, 1989. The High Court of Delhi by its order dated 17th July, 1989 disposed of Writ Petition No. 193....
X X X X Extracts X X X X
X X X X Extracts X X X X
....129A of the Act and that they had sufficient locus standi in public interest to maintain their appeals. In the result the Division Bench of the High Court partly allowed the writ petitions of both the first respondents in these appeals moved by the Union of India as well as HPF and passed the following order : "We have held that the Union of India and M/s. Hindustan Photo Films Ltd. are aggrieved persons' and can maintain an appeal under Section 129A of the Customs Act. The main question in the writ petition at the root of the entire controversy between the parties is whether the said importation of the photo-sensitized material at Bombay was legal or not would now be decided by the Appellate Tribunal. But assuming that M/s. Northern Plastics Ltd. takes an appeal against our order to the Supreme Court and our decision is reversed, still the question of the legality of the importation would be open to the parties to be argued in this writ petition before us. Thus, till the main question of legality of importation is finally disposed of, in the interests of justice, it is necessary that the subject-matter of the controversy, viz. the imported goods, are preserved in the custody ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....on involved in controversy between the parties in these appeals. 4.For the purpose of these appeals we shall assume that the order of Assistant Collector of Customs (Bombay), as approved by the Additional Collector of Customs (Bombay), of 1st June, 1989 was in itself appealable to CEGAT under Section 129A of the Act being a decision and order passed by an adjudicating authority under Section 122 of the Act. We assume as aforesaid for the simple reason that Shri Dave, learned senior counsel for the appellant has vehemently contended that the said endorsement of the Additional Collector of Customs was of an administrative nature and was not appealable. Neither CEGAT nor the High Court of Delhi has considered that question and as that question strictly does not arise for our consideration in the present appeals for deciding the controversy between the parties we have assumed as aforesaid. Rival Contentions 5.Shri Dave, learned senior counsel for the appellant has vehemently contended that the Division Bench of the High Court had patently erred in taking the view in the impugned common judgment that HPF as well as Industries Ministry of the Union of India were `aggrieved persons'....
X X X X Extracts X X X X
X X X X Extracts X X X X
....uage of Section 129A sub-section (1) of the Act the Industries Ministry of the Union of India as well as HPF could be said to be `persons aggrieved'. That according to the Industries Ministry of Union of India the appellant had imported goods which were liable to confiscation under the Act and, therefore, the order of the Additional Collector of Customs (Bombay) was patently erroneous. That it affected the public revenue as well as the effective implementation of IDR Act and, therefore, it could not be said that the Industries Ministry did not represent sufficient public interest to maintain the appeal before CEGAT. Learned counsel for HPF in his turn submitted that HPF which is wholly owned Government company where more than Rs. 400 crores are sunk by Central Government from public coffers is a limb of the Union of India itself and when such large extent of public funds are involved in the working of HPF it cannot be said that it did not represent sufficient public interest to maintain the appeal against the order of Additional Collector of Customs by which huge quantity of illegally imported goods were sought to be released in favour of the appellant. That such goods, if perm....
X X X X Extracts X X X X
X X X X Extracts X X X X
....-section (1) of Section 46 unless the tax had been paid'. Such conditions merely regulate the exercise of the right of appeal so that the same is not abused by a recalcitrant party and there is no difficulty in the enforcement of the order appealed against in case the appeal is ultimately dismissed. It is open to the Legislature to impose an accompanying liability upon a party upon whom legal right is conferred or to prescribe conditions for the exercise of the right. Any requirement for discharge of that liability or the fulfilment of that condition in case the party concerned seeks to avail of the said right is a valid piece of legislation, and we can discern no contravention of Article 14 in it...." 9.It has also to be noted that the wider concept of locus standi in public interest litigation moved before this Court under Article 32 of the Constitution of India which itself is a fundamental right or under Article 226 before High Courts which also offers a constitutional remedy cannot be imported for deciding the right of appeal under the statutory provisions contained in the Customs Act. Whether any right of appeal is conferred on anyone against the orders passed under the ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ppointed day, or (b) the Collector (Appeals) under Section 128A, is not legal or proper, direct the proper officer to appeal on his behalf to the Appellate Tribunal or, as the case may be, the Customs and Excise Revenues Appellate Tribunal established under Section 3 of the Customs and Excise Revenues Appellate Tribunal Act,1986, against such order. (3) Every appeal under this section shall be filed within three months from the date on which the order sought to be appealed against is communicated to the Collector of Customs, or as the case may be, the other party preferring the appeal." Section 129D(1) of the Act also deserves to be noted at this stage. It reads as under : "129D. Powers of Board or Collector of Customs to pass certain orders. - (1) The Board may, of its own motion, call for and examine the record of any proceeding in which a Collector of Customs as an adjudicating authority has passed any decision or order under this Act for the purpose of satisfying itself as to the legality or propriety of any such decision or order and may, by order, direct such Collector to apply to the Appellate Tribunal or, as the case may be, the Customs and Excise Revenues Appellate Tr....
X X X X Extracts X X X X
X X X X Extracts X X X X
....Section 129A(1) of the Act. So far as departmental authorities themselves are concerned including the Collector of Customs no direct right of appeal is concerned on Collector to prefer appeal against his own order before the CEGAT. However there is sufficient safeguard made available to the Revenue by the Act for placing in challenge erroneous orders of adjudication as passed by the Collector of Customs by moving the Central Board of Excise and Customs under Section 129D(1) for a direction to the Collector to apply to the CEGAT for determination of such point arising out of the decision or order as may be specified by the Board of Revenue in this connection. Similarly a statutory remedy is provided to the Collector of Customs in connection with orders of the Appellate Collector of Customs passed immediately before the appointed day and also in connection with the orders passed by Collector of Customs under Section 128A, to direct proper officer to appeal on his behalf as laid down by Section 129A(2). Revisional powers are also conferred on the Central Board of Excise and Customs against the orders of Collectors of Customs as provided by Section 129DA(1) as well as on the Central Go....
X X X X Extracts X X X X
X X X X Extracts X X X X
....`person aggrieved' other than the arraigned party before the Collector of Customs as an adjudicating authority it must be shown that such a person aggrieved being third party has a direct legal interest in the goods involved in the adjudication process. It cannot be a general public interest or interest of a business rival as is being projected by the contesting respondents before us. In this connection we may refer to a Constitution Bench judgment of this Court in the case of Adi Pherozshah Gandhi v. H.M. Seervai, Advocate General of Maharashtra, Bombay [1970 (2) SCC 484]. Question before the Constitution Bench in that case was as to whether Advocate General of the High Court who was to be issued a notice in disciplinary proceedings by the Bar Council as per the provisions of Section 35(2) of the Advocates Act, 1961 had locus standi to prefer an appeal against the order of the disciplinary authority under Section 37 of the Advocates Act before Bar Council of India. A majority of the Constitution Bench took the view that the Advocate General had no such locus standi. He could not be said to be a `person aggrieved' by the decision of the disciplinary authority exonerating th....
X X X X Extracts X X X X
X X X X Extracts X X X X
....order had been made. A `person aggrieved' must be a man who has suffered a legal grievance, a man against whom a decision has been pronounced which has wrongfully deprived him of something, or wrongfully refused him something, or wrongfully affected his title to something." A Bench of four learned Judges of this Court in the case of Jasbhai Motibhai Desai v. Roshan Kumar Haji Bashir Ahmed and others [(1976) 1 SCC 671] had to examine the scheme of Bombay Cinemas Regulation Act, 1958 and a rule therein with a view to finding out whether a rival cinema owner could appeal against a No Objection Certificate granted to an applicant who wanted to establish a cinema theatre of his own. Sarkaria, J., speaking for the Court observed that under the relevant provisions of the Regulations no right was conferred by way of special interest on such a rival cinema owner as he did not satisfy the test of `person aggrieved'. Nor could he be treated to be a valid objector being resident of the locality or person to whom any special right of objection was conferred by the statutory scheme. Thus he was merely a rival cinema owner who was likely to be adversely affected in his commercial interes....
X X X X Extracts X X X X
X X X X Extracts X X X X
....e sunk by the Union of India in its company HPF it could not be said that the Union of India through the Ministry of Industries was a total stranger and had no locus standi whatsoever to challenge the order of the Additional Collector of Customs. So far as the Union of India is concerned we may proceed on the basis that it may have to subserve a larger public interest by raising the present dispute and may legitimately feel aggrieved by the order of the Additional Collector of Customs. But even if it is so, the statutory procedure laid down by the Parliament in its wisdom for enabling the challenge to the adjudication order of the Collector of Customs by way of appeals or revisions as per the aforesaid relevant statutory provisions, to which we have made a mention, has got to be followed in such an eventuality. Bypassing the said statutory procedure a direct frog leap to CEGAT is contra-indicated by the statutory scheme of the Act. If such direct appeals are permitted the very scheme of Section 129D(1) would get stultified. It must, therefore, be held that direct appeal filed by the Union of India through Industries Ministry to CEGAT under Section 129A(1) was clearly incompetent. I....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... (supra) by this Court. Consequently the appeal filed by HPF before the CEGAT also must be treated to be incompetent and could not be covered by the sweep of Section 129A(1) of the Act. 13.Learned counsel for HPF invited our attention to a decision of a two-member Bench of this Court in the case of K. Ramadas Shenoy v. The Chief Officers, Town Municipal Council, Udipi and others [1975 (1) SCR 680]. In that case a resident in a locality wherein a cinema building was being constructed contrary to the binding Town Planning Scheme, was held to be entitled to challenge the said violation of the Scheme by construction of cinema building. Said decision is rendered on its own facts. The statutory Scheme was for the benefit of persons residing in the locality. Under the said Scheme the Municipal authorities owed a public duty and obligation under the statute to see that the residential area is not spoiled by unauthorised construction. Under these circumstances it was held that the aggrieved party had sufficient locus standi under Article 226 of the Constitution of India to move the High Court against the violation of the statutory scheme by the Municipal authorities. It is easy to visualis....
X X X X Extracts X X X X
X X X X Extracts X X X X
....he High Court will stand dismissed. However writ petition filed by the Union of India being Civil Writ Petition No. 3023 of 1989 will have to be permitted to proceed further on remaining controversy before the High Court in so far as Union of India seeks to challenge the order of Collector of Customs, Bombay dated 1st/5th June, 1989. As we have taken the view that Union of India could legitimately challenge the said order before appropriate forum in public interest and as it has wider locus standi at least in proceedings under Article 226 of the Constitution of India if not before CEGAT, its challenge in the writ petition under Article 226 against the said order cannot be told off the gates. That challenge will have to be examined by the High Court under Article 226 on its own merits. It is obvious that it will be open to the appellant as contesting respondent to try to support the impugned order of the Assistant Collector/Collector of Customs on all legally permissible grounds. In short the said controversy between the Union of India on the one hand and the appellant on the other in Union of India's Writ Petition No. 3023 of 1989 will have to be examined by the Division Bench ....