Calcutta High Court
Hiralal @ Hiranand vs Commissioner Of Customs (Airport) & Ors on 19 September, 2013
Author: Sambuddha Chakrabarti
Bench: Sambuddha Chakrabarti
IN THE HIGH COURT AT CALCUTTA
CONSTITUTIONAL WRIT JURISDICTION
ORIGINAL SIDE
Present:
The Hon'ble Justice Sambuddha Chakrabarti
W. P. No. 224 of 2013
Hiralal @ Hiranand
Versus
Commissioner of Customs (Airport) & Ors.
For the petitioner : Mr. Sudhir Kumar Mehta, Advocate
For the respondent
Customs Authorities : Ms. Shampa Sarkar, Advocate Heard on : 19.03.2013 and 02.04.2013 Judgement on : 19.09.2013 The Court : The respondents have raised an objection to the maintainability of the writ petition and as such the issue of maintainability is taken up as a preliminary one.
The present writ petition has been filed praying for a writ in the nature of Mandamus commanding the respondents to release foreign exchange retained by the respondents authorities and for other reliefs.
The petitioner is an accused of the offence of illegal export of currencies of various description and amount as well as Indian currency of Rs. 1,38,000/-. He was also caught carrying bank cheques and bank drafts which were not declared by him. A show cause notice was issued to him and the Joint Commissioner of Customs by an order dated May 20, 2009 confiscated the goods and allowed redemption fine of Rs. 5,00,000/- in lieu of confiscation and imposed penalty of Rs. 1,80,000/-. In an appeal before the Commissioner of Customs (Appeal) the amount of fine was reduced to 3,00,000/- and penalty to Rs. 90,000/-.
In a cross revision preferred by both the parties the Joint Secretary, Ministry of Finance to the Government of India, Department of Revenue held that since the exchange were not declared under s. 77 of the Customs Act they were liable for confiscation and the fine and penalty imposed by the adjudicating authority were restored. The customs authorities were directed to release the Indian equivalent of foreign currency in Indian currency after deducting the amount of fine and penalty.
The petitioner asked for release of the foreign currency and the implementation of the order of the revisional authority. Since this was not done he filed a writ petition in the year 2011 challenging the order passed by the respondents and the inaction on the part of the respondent authorities in releasing the amount equivalent to foreign exchange. The writ petition was disposed of by a learned single judge of this court by an order dated December 21, 2011 by granting liberty to the petitioner to file a representation before the Commissioner of Customs (Airport), Kolkata in terms of the order passed by the revisional authority. It was further directed that if such revision was filed the same should be disposed of by the respondent no. 1 by passing a reasoned order within four weeks from the date of communication of the order in terms of the order passed by the revisional authority. The learned single judge further granted liberty to the petitioner to file appropriate application before the appropriate forum for other reliefs as prayed for in that writ petition.
According to the petitioner nothing was returned pursuant to the order passed by the Commissioner of Customs (Appeal) and the petitioner, therefore, filed the second writ petition being WP 576 of 2012 inter alia praying for a writ in the nature of Mandamus commanding the respondents to release the equivalent amount of foreign exchange in implementation of the order passed by the revisional authority. The petitioner also prayed for an ad interim order of injunction directing the respondents to implement the order passed by the revisional authority to return the equivalent amount of the foreign exchange on such terms as the court deemed fit and proper and for other reliefs.
By an order dated July 25, 2012 a learned single judge of this court disposed of the second writ petition by directing the Commissioners of Customs, Airport and Administration to pay the petitioner the equivalent amount of the seized currency in Indian currency forthwith and in any case within 30 days from the date of the communication of the order.
According to the petitioner since in spite of the order passed by this court in the earlier writ petition the respondents did not return the full foreign currency seized and retained equivalent amount of Indian currency the petitioner has filed the present writ petition for the reliefs as mentioned therein.
The respondents have taken a strong objection to the maintainability of the writ petition which, according to them, is barred by the principles analogous to res judicata as also constructive res judicata. According to them the petitioner cannot approbrate and reprobate. He cannot pray for implementation of the order of the revisional authority and at the same time impugn the same after almost two years. The order dated June 21, 2011 has already been complied with by the petitioner inasmuch as the petitioner had already deposited the redemption fine and penalty and sought for release of the confiscated goods in lieu of payment of redemption fine and penalty.
The respondents had contended that the petitioner had deposited the redemption fine which is the value of the confiscated goods as contemplated under Section 125 of the Customs Act and personal penalty as contemplated under section 112(1). The petitioner has acted in terms of the order and, therefore, cannot challenge the same by this writ petition.
Mr. Sudhir Kumar Mehta, the learned advocate for the petitioner has submitted that there is neither any accord nor satisfaction. After the payment of redemption fine and penalty the petitioner has still a right to prefer an appeal. Paying redemption fine and penalty does not foreclose the right of appeal or to pursue the legal remedies available to him. Mr. Mehta submits that payment of redemption fine and penalty is necessary for the purpose of filing an appeal and for availing himself of the other legal remedies available. According to him the learned single judge disposing of the first writ petition had given the petitioner liberty to file the purported application before the appropriate forum and for other reliefs. The petitioner has interpreted this order as issues being kept open which militates against the possibility of the writ petition being hit by the principle analogous to res judicata.
So far as the second writ petition is concerned, the petitioner argues, entitlement to take release of the goods after payment of the redemption fine is distinct from challenging the confiscation order. It was only by way of abundant precaution that the petitioner pleaded to have reserved the right to challenge the order of confiscation and penalty by a separate proceeding. Mr. Mehta has referred to paragraph 57 of the writ petition wherein it has been pleaded that the second writ petition was filed for the limited purpose of return of the seized currency for which redemption fine was paid without prejudice to the rights and contentions of the petitioner and keeping and reserving the issue of seizure of currency and confiscation thereof to be pursued by the petition in a separate proceeding.
In support of his contention the petitioner has referred to the case of Mool Shankar Singh -Vs.- Regional Manager, PNB and Anr., reported in (2004) 9 SCC 754 for a proposition that even where the earlier writ petition was allowed for making representation and the representation was rejected by the authorities the latter writ petition seeking relief from the High Court would not be a bar since the High Court has not considered the matters on merits.
The next case referred to by the petitioner is Jeypore Sugar Company Limited -Vs.- Sales Tax Officer and Ors., reported in (1998) 9 SCC 358 wherein the appellant initially challenged its exigibility to sales tax on the ground that the sale was in course of export. This contention having been rejected a petition was filed seeking clarification of the order and for a prayer to permit the appellant to approach the sales tax authorities concerned for appropriate relief on the basis of a certain form. This petition was dismissed as withdrawn. The subsequent application was rejected by the High Court on the ground of constructive res judicata. The Supreme Court had held that it would not be just and proper to deny relief to the appellant which was otherwise due on the ground that earlier it had only assailed the question of exigibility to tax. According to the Supreme Court that the plea which is now taken could have been taken earlier but that should not be a ground to deny the relief to the appellant as the technical plea of constructive res judicata should not stand in the way in a case of the present nature.
Mr. Mehta further referred to the case of Paul Industires (India) -Vs.- Union of India and Ors., reported in (2004) 13 SCC 340 for a proposition that after withdrawal of the earlier writ petition to file the rectification petition before the settlement commission the subsequent writ petition challenging the order of rejection by the settlement commission could not be rejected on the ground of withdrawal of the earlier writ petition.
In the case of Daryao and Ors. -Vs.- State of UP and Ors., reported in AIR 1961 SC 1457 the Supreme Court held that if a writ petition filed by a party is considered on the merits as a contested matter and is dismissed the decision thus pronounced would continue to bind the parties unless it is otherwise modified or reversed in appeal or other proceedings permissible under the Constitution. If the petition is dismissed not on the merits but because of the laches of the party he has an alternative remedy to avail himself of. The dismissal of the writ petition would not constitute a bar to a subsequent petition under Article 32 of the Constitution except in cases where the facts thus found by the High Court may themselves be relevant under Article 32 of the Constitution.
According to the petitioners the present petition is not barred by res judicata or accord and satisfaction.
Ms. Shampa Sarkar, the learned advocate for the respondents has submitted that the order complained of has already been complied with by the petitioner by depositing the redemption fine and penalty. The analogy given by the petitioner of disputes relating to chartered vessels exporters pay the differential duty and preferred appeal thereafter is equally not applicable to the facts of the case.
Ms. Sarkar has made a subtle distinction that payment of a redemption fine and penalty was made to get the Indian equivalent of the foreign currency and not as a predeposit of duty for filing the appeal before the Commissioner. Section 129E of the Customs Act provides that a person desirous of appealing against a decision relating to any duty and interest demanded in respect of goods shall pending the appeal deposit with the proper officer the duty and interest demanded or the penalty levied.
The substance of the respondents' submissions cannot be brushed aside. I find sufficient substance in the submission of Ms. Sarkar that since this is not a case of evasion of duty Section 129E of the Customs Act has no manner of application. It is a settled position of law that a party who has acted in terms of an order cannot challenge the same subsequently. In the case of Jayanta Nath Majumder -Vs.- State of West Bengal and Others, reported in 1997(1) CHN 137 it has been held by a division bench of this court in the context of an industrial dispute that if a party accepts the order impugned he is no longer a party aggrieved and he cannot be allowed to maintain the appeal. In that case the petitioner without challenging the award had accepted it and the division bench held that having done so he could not be allowed to seek recourse to challenge the award. The division bench further held that in a writ petition the order of the court is discretionary even if he may prove his legal right. The question of conduct of a party is very important in a writ proceeding.
There is sufficient substance in the submission of Ms. Sarkar that if the order of the revisional authority is struck down the petitioner in any case will not be entitled to ask for the refund of the redemption fine as that this is not provided under the Customs Act.
It appears that the petitioner also cannot get back the seized articles. These goods have been exhibited in the court trial pending before the appropriate court. As such if the petitioner is aggrieved his remedy lies in approaching the criminal court.
In the case of Shyam Telelink Limited now Sistema Shyam Teleservices Limited -Vs.- Union of India, reported in 2010(7) Supreme 244 the Supreme Court had held: "....... The maxim qui approbat non reprobate (one who approbates cannot reprobate)......" is firmly embodied in English Common Law and often applied by courts in this country. It is close to the doctrine of benefits and burden which at its most basic level provides that a person taking advantage under an instrument which both grants a benefit and imposes a burden cannot take the former without applying the latter. A person cannot approbate and reprobate or accept and reject the same instrument.
This settled principle is based on a very ancient enunciation of law. Justice Honyman in Smith -Vs.- Baker reported in 1878 LR 8 CP 350 held that a man cannot at the same time blow hot and cold. He cannot say at one time that the transaction is valid and thereby obtain some advantage to which he could never be entitled on the footing that it is valid, and at another time say that it is void for the purpose of securing some further advantage.
In the case of R. N. Gosain -Vs.- Yashpaldhir, reported in AIR 1993 SC 352 the court had held the doctrine that a person who approbates cannot reprobate is based on the doctrine of election which postulates that no party can accept and reject the same instrument.
The doctrine of election applies to cases when a man as against another has two alternative but mutually exclusive courses to resort to and he is to make an election between the two. If he by his conduct induces the other man to believe that he is pursuing a certain course leaving aside the other and as a result of it that induced other man alters his course of action he is not permitted to subsequently alter his stand by resorting to the other course which he had intentionally decided not to follow. Spencer Bower and Turner in their celebrated work on estoppel by representation had explained the essence of the doctrine of election:
"It is of the essence of election that the party electing shall be "confronted" with two mutually exclusive courses of action between which he should mast, in fairness to the other party, make his choice. ................ In election he is always found confronted by a choice of two alternatives one of which he must eventually choose, to the exclusion of the other."
(Ref. Spencer Bower and Turner - The Law Relating to Estoppel by Representation - 3ed Edition, Indian Reprint, Calcutta 1994 - pp. 313-314) The same authors included conduct of litigants within the four fields to which the doctrine may be applied. Courts also have persistently applied this doctrine to this area. The whole thing boils down to whether a person having reaped the benefit out of a judgement to the litigation can still question the validity of the same.
In re Lart. Wilkinson -Vs.- Blades., reported in 1896(2) Chancery 788 Chitty J. had held that a person who is fully cognizant of the proceedings and who stands by and deliberately takes the benefit of a decision on the construction of a will under which a particular fund is distributed, is estopped by his conduct from reopening any of the questions covered by the former judgement by means of a fresh action. Although this judgement was delivered in the context of the construction of a will the principle deducible therefrom is of universal application. A litigant who has taken the benefit either in whole or in part of a decision of an inferior tribunal is precluded from a plea by way of an appeal or otherwise between the same parties that the decision was wrong or even if it was partly right was erroneously decided as to the residues. He is thus estopped from raising any such plea.
Reference may be made to another case where the same principle was applied in the context of an action for specific performance of a contract or alternatively for damages. In the case of Meng Leong Development Pte Ltd. -Vs. Jip Hong Trading Co Pte Ltd., reported in (1985)1 All ER 120 the Judicial Committee of the Privy Council held that the purchaser had made an election to accept the trial Judge's Award of damages and abandoned his right of appeal seeking specific performance when he demanded and accepted the deposit of damages passed by the trial Court. It was further held that since the vendor had altered his position to his detriment by raising and paying over the damages when he would not have been required to do so if the purchaser had sought specific performance on appeal, the purchaser was estopped from seeking specific performance on appeal. Lord Templeman delivering the majority judgement held that "the vendor was only liable to pay damages or to perform the contract and was not bound to suffer the infliction of both remedies, even with the hope of recovering from the effect of one of them in due course, subject to any order the court might care to make about costs or delay. The vendor having been obliged by the purchaser to comply with the order to pay damages was harassed by the order for specific performance. Once the damages had been raised and paid and accepted the purchaser was estopped by election from appealing against the order for the payment of those damages."
The petitioner while seeking the implementation of the order passed by the respondent authorities and having complied with the same by paying the redemption fine cannot after the lapse of a good deal of time turn around and challenge the same.
This writ petition must be held to be barred on the further ground of being hit by the principle analogous to res judicata and constructive res judicata. A full bench of the Supreme Court in the case of The Direct Recruit Class II Engineering Officers Association and Ors. -Vs.- State of Maharashtra and Ors., reported in AIR 1990 SC 1607, had held that where the High Court dismissed a writ petition after hearing the matter on the merit a subsequent petition in the Supreme Court under Article 32 on the same facts and for the same reliefs filed by the parties will be barred by the general principle of res judicata. The judgement of the High Court under Article 226 of the Constitution passed after a hearing on the merits must bind the parties till set aside in appeal. Again in the case of State of Uttar Pradesh -Vs.- Nawab Hussain, reported in AIR 1977 SC 1680 the Supreme Court after discussing the general principles of res judicata held that it might be that the same set of facts could rise to two or more causes of action. If in such a case a person is allowed to chose and sue upon one cause of action at one time and to reserve other for subsequent litigation that would aggravate the burden of litigation. This is an abuse of the process of the court. This rule has been referred to as a constructive res judicata which in reality is an aspect of the general principle.
In the first writ petition the petitioner had prayed for a writ in the nature of Mandamus commanding the respondents to release the foreign exchange seized and the Indian currency and return the redemption fine and penalty respectively deposited by the petitioner etc. In the present writ petition also the petitioner has made the same prayer seeking a Mandamus commanding the respondents to release the foreign exchange retained by the respondents authorities and for other reliefs.
Thus I find sufficient merit in the preliminary objection by the respondents regarding the maintainability of the writ petition. It will not be proper to admit the petition. The preliminary objection succeeds.
The writ petition is dismissed.
There shall, however, be no order as to costs.
Urgent photostat certified copy of this order, if applied for, be supplied to the parties subject to compliance with all requisite formalities.
(SAMBUDDHA CHAKRABARTI, J.) S. Banerjee