Manmeet Kaur vs Union Of India & Anr.
2012 Latest Caselaw 7145 Del

           *IN THE HIGH COURT OF DELHI AT NEW DELHI

%                                   Date of decision: 13th December, 2012

+                               W.P.(C) No.6609/2012

       MANMEET KAUR                                      ..... Petitioner
                  Through:             Mr. Amit Agarwal & Mr. Pradeep
                                       Chhindra, Advs.
                                    Versus
    UNION OF INDIA & ANR.                       .... Respondents

Through: Mr. Rajeeve Mehra, ASG with Mr. Sumeet Pushkarna, CGSC with Mr. Gaurav Sharma & Mr. Aditya Malhotra, Advs. for UOI.

CORAM :-

HON'BLE THE CHIEF JUSTICE HON'BLE MR. JUSTICE RAJIV SAHAI ENDLAW

RAJIV SAHAI ENDLAW, J

1. This writ petition, filed in public interest, by an Advocate practicing

in this Court, draws the attention of this Court to the state of affairs

prevailing in the Securities Appellate Tribunal, Mumbai, established under

The Securities and Exchange Board of India Act, 1992 (SEBI). It is stated,

that the said Tribunal was constituted to hear appeals against the orders of

the Adjudicating Officers and comprises of a Presiding Officer and two

technical members; that only a sitting or a retired Judge of the Supreme

Court or a sitting or a retired Chief Justice of a High Court is eligible to be

appointed as the Presiding Officer of the said Tribunal; that the last

Presiding Officer of the Tribunal retired on 28 th November, 2011 and none

has been appointed as the Presiding Officer till date; that treating the

absence of the Presiding Officer as temporary, the Ministry of Finance has

vide order dated 5th December, 2011, invoking Rule 5(2) of the Securities

Appellate Tribunal (Procedure) Rules, 2000, permitted the sittings of

Tribunal to be presided over by one of the technical members; that since

then the Tribunal comprising only of technical members has been

entertaining, adjudicating and disposing of appeals.

2. It is the contention of the petitioner that such functioning of the

Tribunal without the Presiding Officer and the order dated 5 th December,

2011 are illegal and the Rule aforesaid invoking which the order dated 5 th

December, 2011 has been issued is ultra vires the SEBI Act and the law.

Reliance in this regard is placed on L. Chandra Kumar Vs. Union of India

(1997) 3 SCC 261, R.K. Jain Vs. Union of India (1993) 4 SCC 119, Union

of India Vs. R. Gandhi (2010) 11 SCC 1 and judgment dated 13th

September, 2012 of the Supreme Court in W.P.(C) No.210/2012 titled

Namit Sharma Vs. Union of India.

3. It is further the contention of the petitioner that the cases before the

said Tribunal involve intricate questions of law and which cannot be

adjudicated without a person with wide adjudicatory experience and

qualifications and status defining a Presiding Officer and which the

members of the Tribunal do not have.

4. It is yet further the contention of the petitioner that such absence of

the Presiding Officer cannot be treated as temporary. In this regard it is

stated that the search for the Presiding Officer was not commenced in time

and the counsel for the petitioner has argued that since the date of retirement

of the earlier Presiding Officer was known, the selection process ought to

have been initiated well in advance to avoid any contingency as has arisen. It

is contended that even now there is inaction in the matter of appointment of

Presiding Officer.

5. The petitioner further contends that the absence of the Presiding

Officer also vitiates the process of selection of a member of the Tribunal. It

is contended that the process for such selection for a member in place of one

of the Members who is to retire on 27th December, 2012 has begun and an

officiating Presiding Officer cannot take the place of a Presiding Officer

who is to be a member of the Selection Committee. In this context it is

pleaded that though Rule 3 of the Securities Appellate Tribunal (Salaries,

Allowances and other Terms and Conditions of Presiding Officer and other

Members) Rules, 2003 provides that appointment of Presiding Officer or

Members shall not be invalidated merely for the reason of any vacancy or

any defect in the constitution of the Selection Committee but the said Rule

cannot provide a carte blanche power to the executive to remain cognizant

of the defects and yet take actions with the presence of such defects only to

subsequently claim the shelter of the said provision.

6. It is yet further contended that civil servants are being given illegal

preference in the matter of appointment as Members of the Tribunal.

Reliance in this regard is again placed on R. Gandhi supra.

7. This petition came up first before us on 17 th October, 2012 when we

had directed the learned ASG appearing on advance notice to inform us as to

what steps are being taken for selection of Presiding Officer and had also

directed that the said appointment be expedited.

8. The learned ASG has today produced the records pertaining to

appointment of the Presiding Officer before us and on the basis thereof has

contended that no Judge of the Supreme Court or Chief Justice of High

Court, sitting or retired, have shown willingness to take up the appointment

as Presiding Officer of the Tribunal and which has led to the proposal for

amendment of the SEBI Act to make even a sitting or a retired Judge of the

High Court eligible for appointment as the Presiding Officer. It is contended

that amendment to the said effect is proposed to be moved in the

Parliamentary session underway.

9. In the face of the aforesaid, we can only direct the Government to

ensure that the proposed amendment to the SEBI Act is moved within the

current Parliamentary session and the consequent steps also taken in right

earnest to ensure appointment of the Presiding Officer of the Tribunal at the

earliest. We direct accordingly.

10. The counsel for the petitioner has pressed for other reliefs claimed in

the petition, of quashing of the order dated 5 th December, 2011 supra, of

declaration of Rule 5(2) supra as ultra vires and unconstitutional, of

quashing of process of selection of member and issuance of directions to

ensure that civil servants or bureaucrats who have retired or are on the verge

of retirement are not inducted as members of the Tribunal.

11. It being the plea of the petitioner as aforesaid that the functioning of

the Tribunal in the absence of a Presiding Officer is illegal, the petitioner

also seeks the interim relief of stay of the order dated 5 th December, 2011; of

stay of the process initiated of selection of member and which would have

the effect of bringing the functioning of the Tribunal to a standstill.

12. Finding it a little strange as to why an Advocate practicing in this

Court should be interested in bringing the functioning of a Tribunal situated

in Mumbai to a standstill, we have enquired from the counsel for the

petitioner as to the locus of the petitioner to maintain the present petition

even in public interest and drawn the attention of the counsel to Kusum

Ingots & Alloys Ltd. Vs. Union of India (2004) 6 SCC 254 reiterating that

vires of a statutory provision cannot be challenged in a vacuum and without

any cause of action. It is also enquired from the counsel whether the

petitioner Advocate has any practice or cases before the Tribunal.

13. The counsel for the petitioner has fairly stated that the petitioner is not

a legal practitioner before the Tribunal and has never appeared before the

Tribunal. He has however contended that she as an Advocate is entitled to

maintain a challenge to statutory provisions in public interest and reference

in this regard is made to S.P. Gupta Vs. Union of India (1981) Suppl. (1)

SCC 87, S.P. Sampath Kumar Vs. Union of India (1987) 1 SCC 124 and

to Salem Bar Association Vs. Union of India (2003) 1 SCC 49 (where

amendments of the year 2002 to the CPC were challenged) and Pareena

Swarup Vs. Union of India (2008) 14 SCC 107.

14. The counsel however again fairly admits that in none of the said

judgments the aforesaid question was raised or decided. The Supreme Court

in a catena of decisions has held that a decision is an authority for what it

decides and not for what can logically be deduced therefrom. (See

Bhavnagar University v. Palitana Sugar Mill Pvt. Ltd (2003) 2 SCC 111,

Bharat Forge Co. Ltd. v. Uttam Manohar Nakate (2005) 2 SCC 489 and

Inderpreet Singh Kahlon v. State of Punjab AIR 2006 SC 2571). Lord

Halsbury in Quinn v. Leathem [1901] A.C. 495 said, "...The other is that a

case is only an authority for what it actually decides. I entirely deny that it

can be quoted for a proposition that may seem to follow logically from it.

Such a mode of reasoning assumes that the law is necessarily a logical code,

whereas every lawyer must acknowledge that the law is not always logical at

all...". The judgments mentioned in preceding paragraph, can thus not be

treated as precedents to the maintainability of this petition filed in public

interest though by an Advocate but who is not a practitioner in the field and

before the Tribunal grievance with respect to functioning whereof is made.

15. The Supreme Court recently in Ayaaubkhan Noorkhan Pathan

Vs. The State of Maharashtra MANU/SC/0939/2012 has again cautioned

the courts against entertaining public interest litigation filed by unscrupulous

persons, as such meddlers do not hesitate to abuse the process of the court. It

was held that the right of effective access to justice, which has emerged with

the new social rights regime, must be used to serve basic human rights,

which purport to guarantee legal rights and, therefore, a workable remedy

within the framework of the judicial system must be provided. The courts,

whenever any public interest is invoked, must examine the case to ensure

that there is in fact, genuine public interest involved. It was also directed that

the courts must maintain strict vigilance to ensure that there is no abuse of

the process of court and that, "ordinarily meddlesome bystanders are not

granted a Visa".

16. Public interest litigation has its genesis in providing access to justice

to persons who by reasons of poverty, helplessness or disability or socially

or economically disadvantaged position, are unable to themselves approach

the court for relief. (see Vinoy Kumar Vs. State of U.P. AIR 2001 SC 1739).

That is not the position here. Persons appealing to or parties to proceedings

before the Tribunal can neither be classified as poor or helpless or suffering

from any disability or disadvantage. That is not the argument of the counsel

for the petitioner also. On the contrary the learned ASG has invited our

attention to judgment dated 26th November, 2012 of the Division Bench at

Bombay where the relief sought of prohibiting the members of the Tribunal

from functioning was declined and the Government was held to be justified

in issuing the order dated 5 th December, 2011 for dealing with the present

contingency. All these circumstances lead us to suspect the motives in filing

the present petition, as aforesaid intended to bring the functioning of the

Tribunal to a standstill.

17. The Supreme Court, in Ghulam Qadir Vs. Special Tribunal (2002) 1

SCC 33, while holding that the orthodox Rule regarding locus standi, that

rights under Article 226 of the Constitution of India can be enforced only by

an aggrieved person (except in the case of a writ for habeas corpus or quo

warranto) has undergone a sea change in the context of writ petitions filed in

public interest, still observed that a mere stranger having no right would still

not have locus standi. The Supreme Court in Ayaaubkhan Noorkhan

Pathan supra also summarized the law in this regard to the effect that a

person who raises a grievance, must show how he has suffered legal injury

and generally, a stranger having no right whatsoever cannot be permitted to

intervene in the affairs of others. Reliance can also be placed on Ravi

Yashwant Bhoir Vs. District Collector, Raigad (2012) 4 SCC 407.

18. We may however clarify that public interest litigation affecting the

administration of justice, at the instance of the Advocates practicing in the

court/fora and representing litigants before that court/fora can be entertained

in as much as those lawyers would have locus to the extent of being directly

affected by the functioning of the said courts/foras. However as aforesaid,

the petitioner herein who is represented through another counsel who is

registered with the Bar Council of Rajasthan and has given the address of his

Jaipur office also are indeed strangers and not concerned with the Tribunal

qua functioning whereof grievance has been made. We are thus not inclined

to entertain the present petition, which appears to be for the benefit of

persons interested in delaying the proceedings before the Tribunal, rather

than in public interest. It is the averment in the petition itself that the

Tribunal deals with matters of high monetary value and we are sure that any

of the parties to the said matters is competent to, if aggrieved, have access to

courts.

19. We also do not find the reliefs claimed in this petition, aimed at

bringing the functioning of the Tribunal to a standstill to be in public

interest. We however hasten to clarify that our observations herein are in the

context of locus standi to maintain the petition only and are not meant to

come in the way of any person aggrieved by the order of the Tribunal and

desirous of challenging the same on the same grounds as raised in this

petition. The Supreme Court, in Guruvayoor Devaswom Managing

Committee Vs. C.K. Rajan (2003) 7 SCC 546 though laid down the

following guidelines in relation to public interest litigations:-

"(i) The Court in exercise of powers under Article 32 and Article 226 of the Constitution of India can entertain a petition filed by any interested person in the welfare of the people who is in a disadvantaged position and, thus, not in a position to knock the doors of the Court.

(ii) Issues of public importance, enforcement of fundamental rights of large number of public vis-a-vis the constitutional duties and functions of the State, if raised, the Court treat a letter or a telegram as a public interest litigation upon relaxing procedural laws as also the law relating to pleadings.

(iii) Whenever injustice is meted out to a large number of people, the Court will not hesitate in stepping in Articles

14 and 21 of the Constitution of India as well as the International Conventions on Human Rights provide for reasonable and fair trial.

(iv) The common rule of locus standi is relaxed so as to enable the Court to look into the grievances complained on behalf of the poor, the deprived, the illiterate and the disabled who cannot vindicate the legal wrong or legal injury caused to them for any violation of any constitutional or legal right.

(v) When the Court is prima facie satisfied about variation of any constitutional right of a group of people belonging to the disadvantaged category, it may not allow the State or the Government, from raising the question as to the maintainability of the petition.

(vi) Although procedural laws apply to PIL cases but the question as to whether the principles of res judicata or principles analogous thereto would apply depend on the nature of the petition as also facts and circumstances of the case.

(vii) The dispute between two warring groups purely in the realm of private law would not be allowed to be agitated as a public interest litigation.

(viii) However, in an appropriate case, although the petitioner might have moved a Court in his private interest and for redressal of the personal grievances, the Court in furtherance of the public interest may treat it necessary to enquire into the state of affairs of the subject of litigation in the interest of justice.

(ix) The Court in special situations may appoint Commission, or other bodies for the purpose of investigating into the allegations and finding out facts. It may also direct management of a public institution taken over by such committee.

(x) The Court would ordinarily not step out of the known areas of judicial review. The High Courts although may

pass an order for doing complete justice to the parties, it does not have a power akin to Article 142 of the Constitution of India.

(xi) Ordinarily the High Court should not entertain a writ petition by way of Public Interest Litigation questioning constitutionality or validity of a Statute or a Statutory Rule."

but nevertheless held that it is difficult to draw a strict line of

demarcation as to which matters and to what extent PILs should be

entertained. We have examined the present matter on the touchstone of

above guidelines and having given our anxious consideration to the matter in

entirety, are of the opinion that the present is not a fit case for being

entertained any further, in public interest.

20. We therefore dismiss this petition save for the directions contained in

para 9 hereinabove. Inspite of our observations aforesaid, we refrain from

imposing costs.

RAJIV SAHAI ENDLAW, J

CHIEF JUSTICE

DECEMBER 13, 2012 pp