Amrit Lal Mehta vs Director General Of Revenue ...
2012 Latest Caselaw 1304 Del

*                IN THE HIGH COURT OF DELHI AT NEW DELHI
+                   WRIT PETITON (CIVIL) NO. 5361/2011

                            Reserved on: 20th December, 2011
%                           Date of Decision:27th February, 2012

        AMRIT LAL MEHTA                               ...Petitioner
                               In person.

                               VERSUS
        DIRECTOR GENERAL OF REVENUE INTELLIGENCE &
        OTHERS                           .....Respondents

Through Mr. Vikas Garg, Sr. Standing Counsel & Mr. Vikas Gautam, Jr. Standing Counsel for respondent Nos. 1 and 2.

Ms. Sweety Manchanda, Advocate for respondent No. 3.

CORAM:

HON'BLE MR. JUSTICE SANJIV KHANNA HON'BLE MR. JUSTICE R.V. EASWAR

SANJIV KHANNA, J.:

Amrit Lal Mehta in 1987 provided information imputing

evasion of customs duty on import of machinery by J.K.

Synthetics Limited.

2. The petitioner by this writ petition impugns the quantum of

award released to him, inter alia, contending that he was earlier

sanctioned reward @ 20% of the customs duty vide certificates

dated 26th March, 1998, 24th May, 2004 and 27th June, 2006 on

the principal amount of tax, i.e., customs duty of Rs.1.21 crores

but the same has been reduced on the penalty and fine amount

of Rs.2.5 crores to 15% on Rs.30 lacs vide certificate dated 14th

February, 2008, to 8.33% on next Rs.60 lacs vide certificate

dated 5th May, 2009 and to 8.28% on the balance Rs.1.60 crores

vide certificate dated 11th May, 2010. It is prayed that the

respondents should be directed to pay the reward @ 20% on the

entire duty including penalty and fine.

3. The respondents herein Director General of Revenue

Intelligence and Investigation, Chairman, Central Board of

Excise and Customs and Union of India have not disputed that

they had levied and recovered duty of Rs.1,21,37,611/- and

penalty etc. of Rs.2.50 crores pursuant to the

assessment/penalty order passed.

4. In order to appreciate the controversy and the contentions

raised by the parties, we have to refer to the chequered history

and the litigations inter se parties.

5. Vide certificate dated 26th March, 1998, the petitioner was

granted interim part reward of Rs.6 lacs. The petitioner in 2003

filed Writ Petition (Civil) No. 7586/2003 alleging delay and failure

on the part of the respondents to make payment of the balance

reward. This writ petition was disposed of vide order dated 20th

April, 2004. The Division Bench observed that payment of

reward was dependent upon actual realisation of dues. It was

held that "adjustment" was a method to recover the dues and the

Revenue authorities had recovered Rs.2.29 crores by way of

adjustment. Reference was made to decisions of the Supreme

Court in Union of India versus C. Krishna Reddy, (2003) 12

SCC 627 and Union of India versus R. Padmanabhan, (2003)

7 SCC 270 and it was, inter alia, directed as under:-

"11. We are not quantifying any sum but, we are directing the respondent to make the payment of the final reward amount in terms of the policy. The amount shall be paid within a period of 15 days from the date on which a copy of this order is produced by the petitioner with interest at the rate of 15% per annum failing which the amount shall be paid at the rate of 18% per annum and the additional 3% per annum shall be borne by the responsible officer who is not taking immediate action in the matter."

6. Revenue preferred a Special Leave Petition, which was

granted and registered as Civil Appeal No. 7482/2004. This

appeal was disposed of vide order dated 26th April, 2005. The

Supreme Court noticed that the Reward Committee had

approved further payment of Rs.3.5 lacs in their meeting

pursuant to the order passed by the High Court in the Writ

petition (Civil) No. 7586/2003 and observed to this extent the

parties cannot have any grievance.

7. However, the Supreme Court did not approve of some of

the observations/directions made by the High Court in the order

dated 20th April, 2004 and it was, inter alia, directed as under:-

" However, considering the fact that it has been held by this Court in the cases of Union of India & Ors. vs. C. Krishna Reddy reported in 2003 (10) SCALE 1050 as well as in Union of India vs. R. Padmanabhan reported in (2003) 7 SCC 270 and in the Reward Scheme that there is no vested right in the person to claim a reward and that the payment can, at the highest, be an ex-gratia payment. There is absolutely no justification to grant interest on such ex-gratia payment. We, therefore, set aside the portion of the High Court order where the interest is directed to be paid as well as the portion awarding costs.

                       Save as above, we see no reason to
                interfere.    The Civil Appeal stands
                dismissed."

8. In this order dated 26th April, 2005 passed by the Supreme

Court, it was also noticed that a contempt petition had been filed

by the petitioner herein before the High Court for the non-

compliance of the order dated 20th April, 2004 and against

quantification of Rs.9.5 lacs (Rs.6 lacs+Rs.3.5 lacs) as the

reward payable. It was clarified that the dismissal of the appeal

before the Supreme Court would not affect the contentions of

the parties in this contempt petition.

9. The aforesaid contempt petition being Contempt Case(C)

No. 613/2004 was disposed of by a detailed decision dated 8th

December, 2005. The Division Bench referred to the reward

policy and quoted paragraphs 4.1, 5.1 and 7.1 of the same. For

the sake of convenience, these are reproduced below:-

"4.1 Informers and Govt. servants will be eligible for reward upto 20% of the net sale- proceeds of the contraband goods seized and/or amount of duty evaded plus amount of fine and penalty levied/imposed and recovered. However, in respect of gold, silver, opium and other narcotic drugs etc. seized under the provisions of the Customs Act, 1962/Narcotic Drugs and Psychotropic Substances (NDPS) Act, 1985, the overall ceiling of reward will be as per specific rates indicated in the Annexure. These ceilings would be subject to periodical revision in the light of the price fluctuations of these items, for which periodical intimations may be sent to the DGRI/DGNCB, who, in turn, will send suitable recommendations to the Ministry, for appropriate revision, as and when warranted.

xxx 5.1 Reward is purely an ex-gratia payment which, subject to guidelines, may be granted on the absolute discretion of the authority competent to grant rewards and cannot be claimed by anyone as a matter of right. In determining the reward which may be

granted, the authority competent to grant reward will keep in mind the specificity and accuracy of the information, the risk and trouble undertaken, the extent and nature of the help rendered by the informer, whether information gives clues to persons involved in smuggling, or their associates etc., the risk involved for the Govt. servants in working out the case, the difficulty in securing the information, the extent to which the vigilance of the staff led to the seizure, special initiative, efforts and ingenuity displayed, etc. and whether, besides the seizure of contraband goods, the owners/organizers/financiers/racketeers as well as the carriers have been approached or not.

xxx 7.1 Final rewards, both to officers as well as informers, should be sanctioned and disbursed only after conclusion of adjudication/appeal/revision proceedings. The final reward will be determined on the basis of the net sale proceeds of goods seized/confiscated (if any) and/or the amount of additional duty/fraudulently claimed Drawback recovered plus penalty/fine recovered, and the total reward admissible, i.e., advance and final reward put together, will not exceed the ceiling of 20% of the net sale proceeds ( if any) plus amount of additional duty/fine/penalty recovered or the amount of drawback fraudulently claimed recovered, as the case may be. This will be subject to instructions in para 4.3 above as regard rewards to Govt. Servants is concerned. The advance/interim reward sanctioned and disbursed, if any, shall be adjusted from the final reward to be paid to the officers/informers."

10. It was thereafter observed that use of the term "upto 20%"

for the quantum and as a ceiling of reward, clearly means that

the reward cannot exceed 20% of the duty/penalty evaded. This

is the outer limit. It was further observed that paragraph 5

forbids grant of reward as a matter of routine. Thereafter, the

Division Bench referred to R. Padmanabhan's case (supra)

wherein it was observed that reward under the scheme was

purely an ex gratia payment but the same could not be denied or

refused arbitrarily. Being an ex gratia payment, no right accrues

to any one, till it is determined and awarded. The following

paragraph from R. Padmanabhan's case (Supra) was quoted:-

"8. .....The rewards are also to be and can be "up to 20%" or as the case may be and not that invariably it must be as a rule 20% of the estimated market value. Reward is purely an ex gratia payment, subject to the Guidelines on the discretion of the competent authority, though it cannot arbitrarily be denied or refused at whim or fancy and it should specifically conform with and must be shown to fall or be claimed within the four corners of the Scheme and not by any deviation or modulation of the Scheme, as the courts think it should be and if it cannot come strictly within the four corners of it, such claim may have to be dealt with only under the residuary powers enabling the grant of reward. That apart, being ex gratia, no right accrues to any sum

as such till it is determined and awarded and, in such cases, normally it should not only be in terms of the Guidelines and policy in force, as on the date of consideration and actual grant but has to be necessarily with reference to any indications contained in this regard in the Scheme itself.... ....Therefore, the reward could not have been allowed in this case completely ignoring the amendments, which came into force in April 1989, merely because the seizure was in February 1989."

11. The Division Bench also quoted from the case of C.

Krishna Reddy (supra), in which it has been held as under:-

"12. The scheme or the policy of the Government of India dated 30-3-1985 shows that the authority competent to grant the reward, while taking a decision regarding the entitlement of the person concerned has to keep many factors in his mind like specificity and accuracy of the information, the risk and trouble undertaken, the extent and nature of the help rendered by the informer, whether information gives clues of the persons involved in smuggling or their associates, the difficulty in securing the information, the risk involved for the government servants in working out the case and whether apart from seizure of contraband goods, the owners/organisers/financiers/racketeers have been apprehended. The scheme further mentions that reward is an ex gratia payment and subject to the guidelines and may be granted on the absolute discretion of the competent authority and further that no one can claim the reward as a matter of right. The High Court in writ jurisdiction cannot examine or weigh the various factors which have to be taken into consideration

while deciding a claim regarding grant of reward. These are matters exclusively within the domain of the authorities of the Department as they alone can weigh and examine the usefulness or otherwise of the information given by the informer. In the writ petition filed by the respondent, no details had been given on the relevant issues. If the grant of reward cannot be claimed as a matter of right, it is not understandable as to how a writ of mandamus can be issued commanding the Government to give a particular amount by way of reward. Though this specific plea was taken in paras 18 and 21 of the counter-affidavit, yet neither the learned Single Judge nor the Division Bench adverted to this aspect of the matter.

13. It is well settled by a catena of decisions of this Court that a writ of mandamus can be granted only in a case where there is a statutory duty imposed upon the officer concerned and there is a failure on the part of that officer to discharge the statutory obligation. The chief function of the writ is to compel performance of public duties prescribed by statute and to keep subordinate tribunals and officers exercising public functions within the limit of their jurisdiction. Therefore, in order that a mandamus may issue to compel the authorities to do something, it must be shown that there is a statute which imposes a legal duty and the aggrieved party has a legal right under the statute to enforce its performance. [See Bihar Eastern Gangetic Fishermen Coop. Society Ltd. v. Sipahi Singh, AIR para 15, Lekhraj Sathramdas Lalvani v. N.M. Shah, Dy. Custodian cum Managing Officer and Umakant Saran (Dr.) v. State of Bihar.]"

12. The Division Bench observed that the authority competent

to grant the reward has to take a decision regarding entitlement

keeping in mind several factors. The courts cannot examine or

weigh those factors which are exclusively within the domain of

the authorities. It was held that the Supreme Court had declared

that no one had a legal right to claim reward particularly when

the scheme itself stipulated that the payment was ex gratia and

may be granted at the discretion of the competent authority.

Mandamus cannot be issued in the absence of a statutory duty.

After referring to the case law, the Division Bench of the High

Court in their decision dated 8th December, 2005 elucidated and

gave the following directions:-

"15. The direction issued by this Court in the writ petition filed by the petitioner has of necessity to be understood in the context of the above legal position. That is particularly so when the question is whether the amount of reward has or has not been properly quantified by the respondents. The respondents had a two-fold option available to them in that regard. The first was to determine a lump sum amount by way of reward taking into consideration the nature of the information and all other relevant facts and circumstances and either pay the same in lump or relate the payment to the realisation of duty from the defaulting party. The other option was to determine an appropriate percentage of the realisations which could not in terms of the policy be

more than 20% and grant the same to the petitioner depending upon the recoveries made by them from time to time. No such decision appears to have been taken. What is mentioned is that a final reward representing 20% of the "amount realised" has been sanctioned in favour of the petitioner. That leaves the question, regarding future realisations and the petitioner's entitlement on the basis of the same, open. It is not clear whether the respondents intend to sanction any further amounts in favour of the petitioner with further recoveries being made by them, nor is it clear whether the amount of Rs.9.5 lacs already sanctioned represents the total amount regardless of the percentage it makes vis-à-vis the realisations. That is an aspect which ought to have been addressed by the reward Committee to put an end to the confusion and avoid multiplicity of legal proceedings in the Court. If the reward Committee intends granting a reward on the basis of a percentage of the realisations made, it can say so in which event the petitioner may have to wait for realisations and seek redress as and when the amount due on that basis is withheld by the respondents. In case, however, the Committee determines in its wisdom a lump sum amount in full and final settlement of the claim for reward, it can do even that to give quietus to the controversy. In either case a decision that is clear as to the total quantum of the reward whether lump sump or by reference to percentage of realisations shall have to be taken. That decision is for the present not discernible from the record placed before us but the omission to take a decision does not appear to be either deliberate or contumacious so as to call for any action in contempt. The problem in our

opinion lies more with the understanding of the purport of the orders passed by this Court than any wilful neglect or defiance of the directions issued on the subject. It is therefore high time that the respondents take an appropriate decision on the subject to avoid any further procrastination of the matter.

16. In the result, we dispose of this petition with the following directions:

(i) The respondents shall quantify the amount payable to the petitioner in terms of the direction issued by this Court in W.P. (C) No. 7586/2003 and the observations made here-in-above within a period of six months from today;

(ii) In case, the respondents decide to grant any further amount to the petitioner by way of reward, the amount, so sanctioned, shall be released in his favour without undue delay not later than two months from the date of such determination; and

(iii) The final decision of the competent authority, taken in terms of the direction of this Court, issued in W.P. (C) No. 7586/2003 and those contained in this order, shall be communicated to the petitioner, who shall then have the liberty to seek appropriate redress in separate writ proceedings which the petitioner shall be free to file, if otherwise legally maintainable."

13. Pursuant to the aforesaid directions, the reward committee

has sanctioned rewards of Rs.14 lacs, Rs.4.5 lacs, 5 lacs and

13.25 lacs vide certificates dated 27th June, 2006, 14th February,

2008, 5th May, 2009 and 11th May, 2010. The certificate dated

27th June, 2006 for Rs.14 lacs was towards part payment of the

principal amount of Rs.1.21 crores. Thus, the petitioner was

paid Rs.23.5 lacs on recovery of Rs.1.21 crores by certificates

dated 26th March, 1998 for Rs.6 lacs, 24th May, 2004 for Rs.3.5

lacs and 27th June, 2006 for Rs.14 lacs. The maximum reward

payable on Rs.1.21 crores was Rs.24.27 lacs. The certificates

dated 14th May, 2008, 5th May, 2009 and 11th May, 2010 are in

respect of penalty/fine of Rs.13 lacs, Rs. 60 lacs and Rs.1.60

crores, respectively (total penalty amount is Rs.2.50 crores).

The reward on the penalty amount has been paid @ 15%,

8.33% and 8.28% on the respective amounts mentioned above.

Thus, in all reward of Rs.46,25,000/- has been paid to the

petitioner.

14. At the very outset, we may notice and reject the contention

of the petitioner that he is entitled to reward @ 20% and this is

the mandate of the scheme. The petitioner has referred to

decision in R. Padmanabhan's case (supra) and paragraph 8

thereof which has been quoted above. The petitioner is

misreading the observations made therein. The said

observations were quoted by the Division Bench in the order

dated 8th December, 2005 and have been rightly understood and

interpreted. The use of the word "upto 20%" does not mean that

as a rule 20% of the tax dues should be paid as a reward. This

is an outer/upper limit and the reward can be for a lower amount.

In R. Padmanabhan's case (supra), the Supreme Court

observed that different criteria can be applied for payment of

reward to Government servants and citizens. In the latter case,

the Government should be liberal and the criteria and parameter

for rewards to informants and government servants can be

different.

15. The Revenue has placed before us copy of the Minutes of

the six Reward Committees and we have examined the same.

The Reward Committee in its meeting held on 12th August, 1997

had sanctioned advance reward of Rs.6 lacs. It was noticed that

under the policy, the petitioner was entitled to reward upto 50%

of the amount due to him as appeals were pending. This was an

interim award, which was awarded as the information was

provided by the petitioner in 1987. It may be noted that till then

no amount had been recovered. This interim award does not

help the case or submissions made by the petitioner.

16. The second Reward Committee was held on 11th May,

2004, pursuant to the directions issued by the High Court in Writ

Petition (Civil) No. 7586/2003. The said Reward Committee in

the minutes dated 11th May, 2004 has observed:-

" Coming to the admissibility of final reward in the impugned case, it is important to note that as per reward policy, reward is purely an ex-gratia payment and as per para 5.1 of the policy, its quantum depends on various factors such as specificity and accuracy of the information, risk and trouble undertaken etc. As already stated, maximum permissible reward in a case is 20% of the amount recovered. The Committee has gone through the facts of the case as well as the letter dated 29th April, 2004 submitted by the Informer, giving details of the information furnished by him.

The Committee observes that the information given by the informer was very generic in nature and the informer does not deserve reward at the maximum rate of 20%. After taking into consideration the amount of duty confirmed i.e. Rs.1.21 crores, recovery of Rs.47.8 lakhs in the impugned case and the relevant facts, the Committee is of the view that total reward amounting to of Rs.9.5 lakhs can be paid to the informer in the impugned case. Accordingly, after adjusting advance reward Rs.6 lakhs already paid, final reward of Rs.3.5 lakhs (Rs. Three lakhs fifty thousand only) is sanctioned to the informer."

(emphasis supplied)

17. We may also note that aforesaid minutes were examined

in Cont. Cas.(C) No. 613/2004, which was disposed of by an

order of remit dated 8th December, 2005.

18. The third Reward Committee was convened pursuant to

the directions issued in the order dated 8th December, 2005 in

Contempt Case (C) No. 613/2004. The said Reward Committee

in its meeting held on 19th May, 2006 observed as under:-

"4. An amount of Rs.9.5 lakhs has been sanctioned and paid to the informer as per decision of the Reward Committee Meetings dated 12.08.97 and 11.05.04. The maximum amount of reward that can be considered in the case in terms of the reward policy on the basis of the realization of Rs.1.21 crores is Rs.24.27 lakhs.

5. The Committee after considering the facts of the case, the specificity of the information and the role played by the informer in this case sanctions a final reward of Rupees Fourteen lakhs only (Rs.14 lakhs) to the informer."

19. One distinguishing and important factor may be noted.

The aforesaid rewards sanctioned were in respect of tax

demand, i.e., customs duty, which was evaded. It was not in

respect of fine and penalty.

20. The first and the third Reward Committees' minutes dated

12th August, 1997 and 19th May, 2006, do not quantify the

reward in the percentage terms. The second Reward

Committee's minutes had recorded that the petitioner did not

deserve reward at the maximum rate of 20% as the information

given was very generic. The second Reward Committee held

on 11th May, 2004, took into consideration the recovery made

and other factors and had accordingly sanctioned Rs.6,00,000/-.

However, observations of the said Reward Committee have to

be read with the directions/observations made by the High Court

in W.P. (C) No. 7586/2003, which were modified by the

Supreme Court and the directions issued in the contempt

proceedings mentioned above. In the third Reward Committee's

meeting held on 19th May, 2006, a further reward of

Rs.14,00,000/- was sanctioned to the petitioner. This Reward

Committee referred to the specificity of the information and the role

played by the petitioner as an informer.

21. The next meeting of the Reward Committee was held on 6th

November, 2007 but the minutes of the said meeting are signed by

members on different dates. This Reward Committee recorded

and held:-

"5. Pursuant to the said directions, a Reward Committee met on 19.05.2006. The said Reward Committee after taking into consideration the directions of Hon'ble High Court of Delhi had observed in its meeting held on 19.05.2006 that "the maximum amount of reward that can be considered in the case in terms of the reward policy on the basis of realisation of Rs.1.21 crores is Rs.24.27 lakhs". The said Reward Committee after considering the facts of the case, the specificity of the information and the role played by the informer sanctioned a final reward of Rs.14 lakhs to the informer.

6. The present Reward Committee further observes that pursuant to the decision of the aforesaid Reward Committee, the Additional Director General, DRI had informed the informer on 22.11.06 that the reward was sanctioned by the aforesaid Reward Committee on the basis of the recovery made so far, and that in the event of any further recovery in the case, the Reward Committee will take a view in the matter"

7. After taking into consideration the above facts, role of the informer, and the fact that further Rs.30 lakhs has been recovered, as intimated vide Commissioner of Central Excise Jaipur-I letter C. No.V(6)49/AE/JPR- I/2002/PT./469 dated 15/19.07.2007 against the penalty of Rs.2.5 crores, the Committee sanctions an amount of part final reward of Rs.4.5 lakhs (Rs.4,50,000/-) to the informer. The Committee further decides that henceforth the reward to the informer will be paid at the rate of 15% of the amount realised in future out of the unrealised penalty amount."

(emphasis supplied)

22. It is clear from the aforesaid minutes that the Reward

Committee had held and decided that henceforth the reward to

the petitioner should be paid @ 15% on penalty amount of Rs.

2.5 crores. Reward of Rs.4.5 lacs was sanctioned as Rs.30 lacs

had been recovered out of penalty and fine payable. It was

decided that reward @ 15% shall be paid on the penalty amount

which would be realised in future.

23. The next meeting of the Committee was held on 26th

March, 2009. Mr. A.C. Buck, Chief Commissioner of Customs

was a Member of this Committee as well as the Committee

which had sanctioned the reward in its meeting held on 6th

November, 2007. In this meeting, it was observed and held as

under:-

"6. After taking into consideration the foregoing facts, role played by the informer in giving the information of a very generic nature and the fact that a further amount of Rs.60 lakhs has been recovered since the Reward Committee met last, as has been intimated vide Additional Commissioner (AE), Jaipur-I's letter C.No.IV(6)49/AE/JPR-

1/02/Pt./1113 dated 28.05.2008 the Committee sanctions an amount of part final reward of Rs.5 (five) lakhs to the informer. The Committee further decides not to bind the future Committees by laying down the percentage of the amount to be realised in future in determining the amount of reward

to be paid in future in the event of further future recovery."

(emphasis supplied)

24. Reading of the aforesaid minutes would show that it was

decided that the petitioner should be paid Rs.5 lacs out of Rs.60

lacs, which had been recovered. It was also observed that the

information given by the petitioner was of a very generic nature.

The Committee over ruled the observations and directions given

in the meeting held on 6th November, 2007 that in future the

petitioner would be paid 15% of the amount realised. Rs.5 lacs

out of Rs.60 lacs works out to 8.33% and is substantially lower

than rate of 15% fixed earlier.

25. The last meeting of the Committee was held on 10th

March, 2010 and in this meeting Mr. A.C. Buck was also present

but as the Director General of Central Excise Intelligence. In

this meeting it was held as under:

"6. After taking into consideration the foregoing facts, role played by the informer in giving the information of a very generic nature and the fact that a further amount of Rs.160 lakhs has been recovered, on account of penalty amount, since the Reward Committee met last, as has been intimated vide Assistant Commissioner, Central Excise Kota Division's letters

C.No.V(19)19/J.K. Recovery/03/part.II/628 dated 14-07-2009 and C.No.V(19)19/J.K. Recovery/03/part. II/249 dated 17-02-2010 the Committee sanctions an amount of part final reward of Rs.13.25 lakhs (Rs. Thirteen lakh and twenty five thousand only) to the informer. This is full and final settlement of the reward amount to the informer."

26. The amount of reward on Rs.160 lacs was reduced to

8.28% or Rs.13.25 lacs. It was further observed that the

information was of a very generic nature.

27. We have quoted above the minutes of various meetings in

which rewards have been awarded. In the first three minutes,

reward has been awarded @ 19.4% that is nearly the maximum

possible rate. The said reward was on the principal amount of

customs duty of Rs.1.21 crores and, therefore, the Reward

Committee was competent to award a lower amount/percentage

on the penalty and fine amount but this is not the reason and

ground given in the last two minutes of the Reward Committee.

The Reward Committee in the last two minutes has opined that

the information given by the petitioner was of generic nature and

according to the role played, the petitioner is entitled to reward

@ 8.33% on Rs.60 lacs and 8.28% on Rs.160 lacs. There is a

contradiction between the findings recorded in the minutes of the

Reward Committee dated 6th November, 2007 in which it was

decided that the petitioner would be paid reward @ 15% on all

future realisation of the penalty amount. There is, therefore,

merit in the contention of the petitioner that there is element of

arbitrariness, inconsistency and disagreement in the three

minutes. In the last two minutes as a result of variance with the

finding recorded in the minutes dated 6th November, 2007 and

the earlier meeting on the 11th May, 2004 the rewarded amount

had come down to 8.33% and 8.28%. Reward is to be awarded

by the Reward Committee keeping in mind several aspects

including specificity and accuracy of information, risk and trouble

taken, extent and nature of help rendered by the informer, etc.

The information furnished was the same, but there is substantial

variance in the amount rewarded. On the basis of the same

information, reward on the penalty and fine amount has varied

between 15% to 8.28%. Same very information was held to be

good to make re-award @ 15% but subsequently held to be

generic and not specific and, therefore, the reward was reduced

to 8.33% and then 8.28%. The difference in monetary terms in

view of the quantum is substantial. It is not as if the Reward

Committee in the meeting dated 6th November, 2007 did not

know the quantum of penalty and fine. The said amount of

Rs.2.5 crores had been already quantified and is mentioned in

the first minutes of the meeting of the Reward Committee held

on 12th August, 1997.

28. In these circumstances, we pass an order of remit and ask

the Reward Committee to consider afresh the rewards awarded

vide minutes dated 26th March, 2009 and 10th March, 2010. We

are not inclined to pass an order of remit in respect of the

meeting held on 6th November, 2007. Percentage and extent of

reward, which can be awarded in case of principal amount, i.e.,

customs duty and the penalty/fine amount can vary and need

not be the same. The amount of reward already paid can also

be relevant criteria. We do not express any opinion on whether

or not reward already sanctioned/paid is sufficient or not. This is

for the reward committee to examine. We have merely

considered the reasons recorded in the minutes dated 26th

March, 2009 and the 10th march, 2010 and find that they are

arbitrary and cannot be reconciled with the earlier finding and

reasoning.

29. As noticed above, this case has had several rounds of

litigation. We, therefore, hope and expect that the Reward

Committee will be convened expeditiously and will dispose of

the issue after examining the details. We clarify that we have

not expressed any opinion on whether or not the petitioner is

entitled to an enhanced reward or reward @15% or even at a

lower rate. The findings/observation made in the meeting dated

6th November, 2007 will not be binding on the Reward

Committee, and they shall independently apply their mind. We

have interfered only because there was contradiction in the

reasons referred to by the Reward Committee, which is nothing

but an error in the decision making process. The Reward

Committee will examine the claim on the basis of the

policy/guidelines or the scheme. The petitioner will be at liberty

to make a written representation, which will be placed before the

Reward Committee. The said written representation will be filed

within a period of three weeks from today. The writ petition is

disposed of. No costs.

-sd-

(SANJIV KHANNA) JUDGE

-sd-

( R.V. EASWAR ) JUDGE FEBRUARY 27, 2012/VKR