Sanjay Pandey & Ors vs Central Board Of Direct Taxes
2014 Latest Caselaw 5699 Del

*     IN THE HIGH COURT OF DELHI AT NEW DELHI

+                     W.P.(C) 3805/2014

                                            Decided on : 12.11.2014
IN THE MATTER OF
SANJAY PANDEY & ORS                               ..... Petitioners
                      Through : Mr. Sanjeev Rajpal, Advocate

                      versus

CENTRAL BOARD OF DIRECT TAXES                   ..... Respondent
                   Through : Mr. R.V. Sinha and
                   Mr. A.S. Sinha, Advocates

CORAM
HON'BLE MS.JUSTICE HIMA KOHLI

HIMA KOHLI, J. (ORAL)

1. The present petition has been filed by the petitioners praying

inter alia for quashing the order dated 12.11.2013, passed by the

respondent/CBDT, declining to promote them w.e.f. 23.9.2010, the

date when the DPC was held.

2. On 24.9.2014, it was recorded that the petitioners, who were

working on the post of Additional Commissioners of Income Tax,

Department of Revenue, Ministry of Finance, have a grievance that the

respondent/CBDT has violated the order dated 6.7.2012 passed by the

Division Bench in a batch of writ petitions filed by them, including

WP(C)No.8017/2010 filed against the order dated 2.11.2010 passed

by the Central Administrative Tribunal (CAT), Principal Bench, New

Delhi. On the aforesaid date, learned counsel for the petitioners was

requested to address arguments on the maintainability of the present

petition as the petitioners have approached the High Court directly,

when as per the guidelines in the case of L. Chandra Kumar vs. Union

of India & Ors. reported as (1997) 3 SCC 261, in the first instance,

their remedy lies before the Tribunal, since respondent/CBDT, being a

part of the Central Government, comes under its jurisdiction. Learned

counsel had sought an adjournment to enable him to examine the

aforesaid aspect and address arguments.

3. Today, Mr. Rajpal, learned counsel for the petitioners states that

once notice to show cause was issued in the present petition on

30.5.2014, this Court is precluded from raising the question of

maintainability of the petition or going into the issue of lack of

jurisdiction for the reason that any such decision would amount to

reviewing the order dated 30.5.2014, which is impermissible in law. To

substantiate his argument, learned counsel relies on a decision of the

Supreme Court in the case of State Bank of India & Ors. vs. Labour

Enforcement Officer (Central) and Anr., reported as (1997) 10 SCC

258.

4. It may be observed that the Administrative Tribunals Act, 1985

is a self-contained Code. Central Administrative Tribunals that have

been constituted in terms of Article 323(A) & Article 323(b) of the

Constitution of India, have the requisite jurisdiction to determine all

service disputes, including the vires of statutes or statutory rules. In

view of the fact that judicial review is one of the basic features of the

Constitution of India, in the well known case of L. Chandra Kumar

(supra), the Supreme Court had clarified that the High Courts and the

Supreme Court shall have the powers of judicial review over the

decision of the Tribunal but it had gone on to lay down a road map to

be followed by litigants governed under the aforesaid Statute, for

seeking legal recourse. In this context, following observations of the

Supreme Court are relevant:-

"93. Before moving on to other aspects, we may summarise our conclusions on the jurisdictional powers of these Tribunals. The Tribunals are competent to hear matters where the vires of statutory provisions are questioned. However, in discharging this duty, they cannot act as substitutes for the High Courts and the Supreme Court which have, under our constitutional setup, been specifically entrusted with such an obligation. Their function in this respect is only supplementary and all such decisions of the Tribunals will be subject to scrutiny before a Division

Bench of the respective High Courts. The Tribunals will consequently also have the power to test the vires of subordinate legislations and rules. However, this power of the Tribunals will be subject to one important exception. The Tribunals shall not entertain any question regarding the vires of their parent statutes following the settled principle that a Tribunal which is a creature of an Act cannot declare that very Act to be unconstitutional. In such cases alone, the concerned High Court may be approached directly. All other decisions of these Tribunals, rendered in cases that they are specifically empowered to adjudicate upon by virtue of their parent statutes, will also be subject to scrutiny before a Division Bench of their respective High Courts. We may add that the Tribunals will, however, continue to act as the only courts of first instance in respect of the areas of law for which they have been constituted. By this, we mean that it will not be open for litigants to directly approach the High Courts even in cases where they question the vires of statutory legislations (except, as mentioned, where the legislation which creates the particular Tribunal is challenged) by overlooking the jurisdiction of the Tribunal concerned." (emphasis added)

5. Thus, it was clarified that a cause of action that had arisen

subsequent to the decision in the case of L. Chandra Kumar (supra),

shall have to be agitated before the Tribunal in the first instance and

the jurisdiction of the Division Bench of the concerned High Court

under Article 226 of the Constitution of India can be invoked only after

approaching the Tribunal and obtaining a decision from it. As was

discussed in the aforesaid case, the jurisdiction of the High Court

under Article 226 of the Constitution of India has not been completely

ousted. The only fetter imposed on the said discretion is that as the

first step, the litigants shall approach the Tribunal that will continue to

act like courts of first instance in respect of areas of law for which they

have been constituted and only after a decision is taken by the

Tribunal, can they approach the Division Bench of the High Court

within whose jurisdiction the Tribunal falls. Further, if aggrieved by the

decision of the Division Bench of the concerned High Court, the

aggrieved party can move the Supreme Court under Article 196 of the

Constitution of India.

6. In the present case, indisputably, in the first round of litigation,

the petitioners had approached the Tribunal for relief as a court of first

instance. After the Tribunal had passed an order, the aggrieved parties

including the petitioners herein had approached the Division Bench of

this Court by filing writ petitions which were disposed of vide common

judgment and order dated 6.7.2012. Now, for the counsel for the

petitioners to urge that the petitioners are well entitled to approach a

Single Judge of this Court directly for relief, which would lie in the first

instance before the Tribunal, is found to be quite untenable and is

turned down.

7. Coming next to the submission made by learned counsel for the

petitioners that once a notice to show cause was issued in the present

petition on 30.5.2014, any decision to non-suit the petitioners on the

ground of lack of jurisdiction amounts to a review, it may be noted

that the competence of a Court to try and entertain a case goes to the

very root of its jurisdiction. The jurisdiction of the Court is of various

types, including inherent, territorial and pecuniary. While objections in

respect of the pecuniary, personal and territorial jurisdiction ought to

be ordinarily raised at the earliest opportunity and the Court is well

empowered to decline to entertain such an objection at a later stage or

if it is raised very belatedly, when it comes to lack of inherent

jurisdiction, nothing can confer the same on the Court, either by

waiver or on account of oversight.

8. Resultantly, when inherent jurisdiction is lacking in a court, mere

issuance of a notice to show cause in the writ petition, cannot be

treated as a waiver. If it comes to the notice of the Court at any stage

of the proceedings, whether suo moto, or otherwise, that there is a

question that needs to be examined with regard to maintainability of a

petition on the ground of lack of inherent jurisdiction, then there can

be no question of waiver of such an objection only on account of the

fact that notice to show cause has been issued in the petition. Even

otherwise, if notice came to be issued in the present petition, the

respondent/CBDT is not barred from raising the same when filing their

counter affidavit, which has yet to be filed.

9. Pertinently, the Registry had listed the present petition before

the Court with an objection that it was maintainable before the

Tribunal. It appears that the said objection was not brought to the

notice of the predecessor Bench at the time of admission, may be

because none was present on behalf of the respondent/CBDT on the

said date to assist the Court. It appears that notice came to be issued

in the writ petition without examining the aforesaid aspect. However,

on the very next date of hearing, i.e., on 24.09.2014, Mr. Sinha had

appeared for the respondent/CBDT and raised the objection of

maintainability of the petition and learned counsel for the petitioners

was called upon the satisfy the court on that aspect.

10. The submission made by learned counsel for the petitioners that

such a detection is not fundamental in character or does not amount to

anything more than an irregularity in exercise of jurisdiction or that

show cause notice having been issued in the petition, the Court is

barred from questioning the same subsequently, is found to be devoid

of merits and is rejected.

11. Further, reliance placed by him on the decision of the Supreme

Court in the case of State Bank of India and Ors (supra) will also not

be of any assistance to the petitioners for the reason that in the

aforesaid case, aggrieved by the prosecution launched against the

appellant/Bank under Section 24 of the Contract Labour (Regulation

and Abolition) Act, 1970, it had moved the High Court under Section

482 Cr.PC for quashing the said prosecution. The High Court had

declined to grant any relief to the appellant/Bank and aggrieved by the

said order, the appellant/Bank had approached the Supreme Court,

where it was claimed that another Single Judge of the very same High

Court had quashed a similar prosecution initiated against the Bank, by

accepting their contention that in view of Section 1(4), the Act had no

application to their establishment at the relevant point in time. Taking

note of the aforesaid submission, the Supreme Court had observed

that if the Single Judge was unable to share the views expressed by

another Judge on an identical point, the matter ought to have been

referred to the Division Bench in accordance with legal propriety and

resultantly, the SLP filed by the Bank was allowed.

12. In the present case, no decision has been taken either on merits

or on the issue of maintainability of the present petition on the ground

of lack of jurisdiction. Simply because notice to show cause was issued

to the respondent/CBDT on the first date, will not preclude this Court

from examining the aspect of inherent jurisdiction on a subsequent

date. Nor would issuance of the notice prevent the respondent/CBDT

from taking the plea of lack of inherent jurisdiction in this court at the

first available opportunity or at the time of filing the counter affidavit

or even thereafter. It is commonplace for the respondents to raise a

number of preliminary objections, including legal objections as to the

maintainability of the petition, both orally and when filing a reply and it

is equally commonplace for the Courts to allow such objections, if

found valid. A show-cause notice is nothing but a notice to the

respondent to show cause as to why a petition should not be admitted

for hearing. This Court is therefore of the opinion that no "view" was

taken by the predecessor Bench on the issue of maintainability of the

present petition, for the order dated 24.9.2014 to be treated as a

"review" of an earlier order.

13. In the instant case, the petitioners are working on different posts

with the respondent/CBDT and they have raised a grievance with

regard to their promotions. In such a situation, they cannot be

permitted to bypass the forum of the Tribunal and approach a Single

Judge of the High Court directly for relief. It is for the petitioners to

follow the route charted out by the Supreme Court in the case of L.

Chandra Kumar (supra). Only after they exhaust their remedy before

the Tribunal, can the petitioners approach the High Court in appeal,

and in that eventuality, their petition would have to be placed before

the Division Bench for appropriate orders.

14. Accordingly, the notice dated 30.5.2014 is discharged and the

writ petition is dismissed as not maintainable directly in the High

Court. However, liberty is granted to the petitioners to approach the

Tribunal for appropriate relief, in accordance with law.

(HIMA KOHLI) JUDGE NOVEMBER 12, 2014 sk/rkb