Customs, Excise and Gold Tribunal - Delhi
Arunodaya Mills Ltd. vs Collector Of Customs on 29 July, 1988
Equivalent citations: 1989(19)ECC28, 1990ECR57(TRI.-DELHI), 1988(37)ELT459(TRI-DEL)
ORDER V.T. Raghavachari, Member (J)
1. This Bench of 3 Members was constituted under order dated 8.12.1987 of Shri G. Sankaran, Senior Vice-President, to hear submissions on the points of difference arising out of the orders of Shri K.S. Dillpsinhji, Member (Technical) and Shri K. Gopal Hegde, Member (Judicial) who heard arguments in these four appeals. The order dated 8.12.1987 was in terms of Section 129-0(5) of the Customs Act.
2. One of the parties [M/s. P.G. Textile Mills (P) Ltd.] had intimated under letter dated 7.7.1988 that they would not be appearing before us and that we may decide the matter on merits in their absence. Accordingly none was present on their behalf during the hearing before us.
3. At the commencement of the hearing Shri Dave appearing for M/s. Jayshree Textiles submitted that so far as his client is concerned there is no point of difference to be resolved since both the Members of the West Regional Bench had held in favour of his client and had ordered allowing that appeal. In the circumstances he submitted that there may not be any occasion for him or his client to participate in these proceedings. He requested Shri Chandrasekharan, Advocate appearing for the Department, to confirm whether it would be so. Shri Chandrasekharan then submitted that he could not affirm the same, since the Department was raising several objections which go to the root of the matter as to the right of this Bench to hear any submissions in this matter. Proceedings were then continued in the light of the above.
4. Shri Chandrasekharan, appearing for the Department, submitted that he would be raising 3 objections as to the validity of the proceedings before us. They were:
(i) There is no valid order of the West Regional Bench but of which any reference under Section 129-C(5) could arise and hence we were not entitled to hear the matter;
(ii) In any event the Section requires the two Members to jointly formulate the points on which they differ and, since, in the present instance, the formulation of the points of difference had been done by one of the Members only (Shri Hegde) there is ho proper reference under Section 129-C(5) on which we could hear submissions; and
(iii) the reference to this Bench under Section 129-C(5) could be only under the order of the President of the Tribunal but that in the present instance the order dated 8.12.1987 is by the Senior Vice-President and for that reason this Bench has not been validly constituted and could not hear submissions.
Shri K. Srinivasan, Consultant, appearing for M/s. L.D. Textiles opposed all these submissions. Shri Parasurampuria for M/s. Arunodaya Mills Ltd. also opposed these submissions. Shri Hardeep Anand, Advocate, representing Shri 0. Dave (on the day when the turn of M/s. Jayshree Textiles came up for making submissions) submitted that he would adopt the submissions of Shri K. Srinivasan and Shri Parasurampuria and would on this ground oppose the submissions for the Department.
5. In respect of the first submission of Shri Chandrasekharan as mentioned above, his argument was that under Section 129-C(5) of the Customs Act the Bench (where members differ on a particular point) has to make the reference to the President incorporating therein the points on which they differ and in the present Instance there was no such order of the Bench since by the time Shri Hegde recorded his order Shri Dilipsinhji was no longer in service having retired earlier. It is seen from the records that Shri Dilipsinhji had signed his order on 7.8.1987. He had retired from service on 14.8.1987. Shri Hegde had signed his order on 16.11.1987. Thereafter he had formulated the points of difference on 18.11.1987 and then submitted the records to the President. Shri Chandrasekharan's submission is that the order of reference could be deemed to have been passed on 16.11.1987 or 18.11.1987 only and since on that day Shri Dilipsinhji was no longer in service there Is no valid order of the West Regional Bench.
6. In support of this submission he relied on the decision of the Supreme Court in Surendra Singh v. State of Uttar Pradesh (AIR 1954 Supreme Court 194). In that case an appeal (against judgment in a sessions trial in which one accused had been sentenced to death and the other two to imprisonment) was heard by two Judges of the Allahabad High Court (Lucknow Bench) on 11.12.1952. Judgment was reserved on the conclusion of the hearing. Before the judgment could be delivered by the Bench, one of the Judges (Bhargava, J.) was transferred to Allahabad. At Allahabad he dictated the judgment (for himself and on behalf of his brother Judge) and signed the same at every page as well as at the end but did not date it. He sent the same to the other Judge at Lucknow (Kidwai, J.). Bhargava, J., thereafter died on 24.12.1952. On 5.1.1953 Kidwai, J. delivered the judgment sent to him by Bhargava, J. and signed it and dated the same as 5.1.1953. In the appeal to the Supreme Court the accused contended that there was no proper judgment of the Bench of the High Court which heard their appeal. This was on the basis that the date of judgment was 5.1.1953 but that on 5.1.1953 there could not have been a Bench to deliver the judgment as one of the Judges had died earlier. The Supreme Court accepted this contention and allowed the appeal directing that the appeal before the High Court shall be reheard by a proper Bench. Shri Chandrasekharan contends that the same reasoning would apply in the present instance also and "we should, therefore, hold that there is no proper order of the West Regional Bench In terms of which the President could act under Section 129-C(5) to constitute this Bench to hear points of difference arising out of the purported order of the West Regional Bench.
7. Before we take up consideration of that' argument, It would be better to refer to the objection raised by the appellants in connection with this argument. Their contention was that this Bench, constituted under the orders of the Senior Vice-President functioning as the President, is not entitled to hear any submission on the part of the Department regarding the validity of the present proceedings, but must proceed to hear the submissions on the points of difference only as had been accepted by the President to have been validily formulated. They contend that the argument, as to the competence of this Bench to hear submissions, could be raised by the Department, if so advised, only before any other duly constituted authority, such as the High Court, In proceedings Initiated therein for striking down the order dated 8.12.1987. It appears to us that this may not be a proper approach to this problem. We say so keeping In mind the other two submissions also of the Department. The other two submissions relate to the proper formulation of the points of difference as also the right of the Senior Vice-President to constitute this Bench. On the Issue of the Senior Vice-President being entitled to function as President in the present matter, the same would depend upon the construction of the notification relied on by the appellants as entitling the Senior Vice-President to function as President for discharge of the functions under Section 129-C(5). May be, ft may not be open to Members who have been constituted into a Bench by the orders of the Senior Vice-President (functioning as President under the notification) to question his right to do so. That may be a presentable argument. However, so far as the right of the Bench to hear submissions on the points of difference, the said jurisdiction could be traced not merely to the order dated 8.12.1987 but to the very provisions of Section 129-C(5) of the Act Itself. While the constitution of the Bench may be by an order of the President (and, therefore, not liable to be questioned by the Members of that Bench) the jurisdiction of the Bench to hear submissions on the points referred to therein could be traced to the right conferred on the Bench under Section 129-C(5). If that right is questioned [on the ground that there is no proper order at all under which proceedings could be taken under Section 129-C(5)] it cannot be said that the Bench before which this argument is raised is not competent to hear the said submissions (on the ground that the Bench has been constituted by the President).
8. In the case of Surendra Singh (supra) the Supreme Court made certain observations as to what would constitute a judgment or order, when the matter had been heard by a Bench of Judges. It took into consideration the fact that the matter before the Court arose out of criminal proceedings. However, it laid down certain general principles as to what would constitute a judgment, irrespective of whether the matter arose in a CM or a criminal manor or even otherwise. It is no doubt true that the observations of the Supreme Court were with reference to requirements of judgments or orders of Courts, which are always intimated to the parties, and to the world at large, by formal pronouncement or delivery in open court. A question may arise whether those observations would apply equally to cases such as judgments or orders of this Tribunal which need not necessarily, under the rules of the Tribunal, be announced or delivered in open Court, but, may, after judgment is reserved, be issued and communicated to the parties. It would appear to us that having regard to the ratio laid down in the judgment of the Supreme Court this aspect should not make any difference.
9. It would be appropriate at this stage to extract certain portions of the judgment of the Supreme Court to understand the ratio laid down.
(11) An important point therefore arises. It is evident that the decision which is so pronounced or Intimated must be a declaration of the mind of the Court as it is at the time of pronouncement. We lay no stress on the mode or manner of delivery, as that is not of the essence, except to say that it must be done In a judicial way in open Court. But however it is done it must be an expression of the mind of the Court at the time of delivery. We say this because that is the first judicial act touching the judgment which the Court performs after the hearing. Everything else uptill then Is done out of Court and is not intended to be the operative act which sets all the consequences which follow on the judgment in motion. Judges may, and often do discuss the matter among themselves and reach a tentative conclusion. That is not their judgment. They may write and exchange drafts. Those are not the judgments either, however, heavily and often they may have been signed. The final operative act is that which is formally declared in open Court with the Intention of making it the operative decision of the Court. That is what constitutes the "judgment."
(12) Now upto the moment the judgment is delivered Judges have the right to change their mind. There is a sort of 'locus paenitentiae', and indeed last minute alterations often do occur. Therefore, however much a draft judgment may have been signed beforehand, It is nothing but a draft till formally delivered as the judgment of the Court. Only then does it crystalise into a full-fledged judgment and become operative. It follows that the Judge who "delivers" the judgment, or causes It to be delivered by a brother Judge must be in existence as a member of the Court at the moment of delivery so that he can, if necessary, stop delivery and say that he has changed his mind. There is no need for him to be physically present in court but he must be in existence as a member of the Court and be In a position to stop delivery and effect an alteration should there be any last minute change of mind on his part. If he hands in a draft and signs it and indicates that he intends that to be the final expository of his views it can be assumed that those are still his views at the moment of delivery if he is alive and in a position to change his mind but makes no steps to arrest delivery.
But one cannot assume that he would not have changed his mind if he is no longer in a position to do so. A Judge's responsibility is heavy and when a man's life and liberty hang upon his decision nothing can be left to chance or doubt or conjecture; also, a question of public policy is involved. As we have indicated, It is frequently the practice to send a draft, sometimes a signed draft, to a brother Judge who also heard the case. This may be merely for his information, or for consideration and criticism. The mere signing of the draft does not necessarily indicate a closed mind. We feel it would be against public policy to leave the door open for an investigation whether a draft sent by a Judge was intended to embody his final and unalterable opinion or was only intended to be a tentative draft sent with an unwritten understanding that he is free to change his mind should fresh light drawn upon him before the delivery of judgment.
13. Views similar to this were expressed by a Full Bench of the Calcutta High Court consisting of nine Judges in the year 1867 in - 'Mahomed Akil v. Asadunnlssa Blbee', 9 WR 1 (FB) (B). In that case, three of the seven Judges who constituted the Bench handed in signed judgments to the Registrar of the Court. Before the judgment could be delivered, two of them retired and one died. A Full Bench of nine Judges was converted to consider whether the drafts of those three Judges could be accepted as judgments of the Court. Seton-Kerr, J. who had heard the case along with them, said -
"Certainly as far as I can recollect, they appeared to have fully made up their minds on a subject which they had very seriously considered, and on which they had had abundant opportunities of forming a final determination. I am, however, not prepared to say that they might not on further consideration have changed their opinions...." (13).
Despite this, ail nine Judges were unanimous in holding that those three opinions could not be regarded as judgments in the formal sense of the term. In our opinion, Jackson, J. expressed the law aright in these words:
"I have however always understood that it was necessary in strict practice that judgments should be delivered and pronounced in open Court. Clearly, we are met today 'for the first and only time' to give 'judgment' in these appeals; and it appears to me, beyond question, that Judges who have died or have retired from the Court cannot join in the judgment which is to be delivered today, and express their dissent from it." (p. 5).
Peacock, C.J. pointed out at page 30 -
The mere arguments and expressions of opinion of individual Judges who compose a Court, are not judgments. A judgment in the eye of the law is the final decision of the whole Court. It is not because there are nine Judges that there are nine judgments. When each of the several Judges of whom a simple Court is composed separately expresses his opinion when they are all assembled, there is still but one judgment, which is the foundation for one decree. If it were otherwise, and if each of the memoranda sent in on the present occasion were a judgment, there would be nine judgments in one case, some deciding one thing and some another, and each Judge would have to review his own judgment separately, if a review should be applied for."
We do not agree with everything which fell from the learned Chief Justice and the other Judges in that case but, in our opinion the passages given above embody the true rule and succinctly explain the reasons for ft."
10. It would be dear from the above that the Supreme Court came to the conclusion it did taking Into consideration the circumstance that an order of the Bench does not become final until the members of the Bench have had an opportunity to discuss the matter after, In suitable cases, drafts are prepared by the different members expressing different opinions and after such discussion either an agreed judgment emerges or the members decide to adhere to the opinion originally expressed and, thereafter, pronounce or Issue separate orders. The Supreme Court held that unless there was such ah opportunity for a discussion until the date of the final order, the drafts prepared, or even the fair judgment prepared by one or more (but not all) of the members, would not attain finality until, after discussion, a final decision is taken.
11. In the present instance it has already been seen that Shri Dilipsinhji wrote and signed his order on 7.8.1987. He had retired shortly thereafter on 14.8.1987. It Is not known whether Shri Dilipsinhji recorded his order after a discussion and after the two members agreed to differ. In any event, as the Supreme Court has observed, It would have been open to Shri Dilipsinhji to alter his opinion and agree with the opinion of Shri Hegde after Shri Hegde prepared his order. Such an opportunity was certainly not available in the present instance since long before 16.11.1987 Shri Dilipsinhji had retired. In the circumstances it appears to us that, applying the ratio of the judgment of the Supreme Court, it will have to be held that there was no proper order of the West Regional Bench since on 16.11.1987 (the date of the order) there was no West Regional Bench consisting of Shri Dilipsinhji and Shri Hegde.
12. In this connection we may also refer to the decision of the Supreme Court In the case of Sheonandan Paswan versus State of Bihar 1986 (1) Judgments Today 1132 (Supreme Court).
13. The opening paragraph of the judgment of the Khalid. J. (at page 1172 of the report) reads as follows:
"I regret I cannot persuade myself to agree with the judgment now pronounced by the learned Chief Justice, the last portion of which was received by me on 18.12.1986. It Is unfortunate that a discussion could not be held about this case by the Judges who heard this case after it was reserved for Judgment in September 1986. It was by a sheer accident that this appeal came before a Constitution Bench. 'Criminal Appeal Nos. 48 and 49 of 1983 were originally directed to be posted before a Constitution Bench and this appeal was also directed to be heard by a Constitution Bench because the same points were involved. Judgments are being pronounced today in those appeals dismissing them. I have agreed with the conclusion but not with the reasoning. Due to paucity of time I have written only a short Judgment there. This appeal has been pending for a long time. I am, therefore, pronouncing a Judgment of my own hurriedly prepared so that this matter can be given a quietus."
This would give an indication that Khalid. J. felt it necessary to record his judgment ateoimmediately so that It may be Included in the judgments under which the matter was being disposed of by the Supreme Court, the urgency for the judgment being immediately prepared being the impending retirement of the Chief Justice who was also one of the members of the Bench and whose judgment was the leading judgment. This would also In a way support the contention for the Department before us, that if a matter heard by a Bench of Judges is to be properly and legally disposed of, the judgment of all the members of the Bench should be ready and signed and either delivered or issued when all the member are serving and that, otherwise, it would not be a proper judgment If It Is announced or Issued after one of the members had retired.
14. Shri Srinivasan submitted that the defect if any is only In the matter of procedure and would not affect the validity of the judgment, in view of the discussion earlier, and In view of the obsrevations of the Supreme Court, we are unable to accept the contention that the defect (in that one of the members signed the judgment after the other had retired from service) was one of procedure only. He has referred to the decisions in Commissioner of Income Tax versus Royal Textiles [120 (1979) ITR 506]; Morari Lal v. S.K. Vad (AIR 1976 Supreme Court 313) and the judgment of the Bombay High Court (Panaj Bench) in writ petitions 66/87 and 67/87 in the case of Chowgule and Company (unpublished and copy of the judgment made available). In AIR 1976 Supreme Court 313, the Supreme Court stated that the machinery sections in any Act ought to be construed so as to effectuate the charging sections. It extracted an observation of Lord Dunedin in (1925) 10 tax cases 88 to the effect that a statute is designed to be workable, and the Interpretation thereof by a Court should be to secure that object unless crucial omission or dear direction makes that end unattainable. It appears to us that the observations of the Supreme Court in that case would not be of assistance to the appellants' in the present case since the said observation related to machinery provisions. In the light of the observations of Supreme Court in the case cited for the Department we are satisfied that the defect in the present case was not breach of a machinery provision only. Similarly, the Madras High Court judgment as well as the Bombay High Court judgment dealt with non-observance of the machinery provisions. Shri Srinivasan referred to certain observations In the judgment of the Bombay High Court where, after referring to certain decisions of the Supreme Court, it was held (at the end of para 37) that an irregularity in matters relating to form does not vitiate the Act or render it void unless there is a positive provision of law making it invalid. He submitted that in the absence of any provisions in the Customs Act to the effect that unless the judgment is signed by both members of the Bench when both of them are in service the judgment shall be invalid, we should not pronounce such a result.
15. In this connection it should be noted that the only provision as to how judgments are to be announced or issued by this Tribunal is under Rule 26 of the CEGAT Procedure Rules which lays down that every order of the Tribunal shall be in writing and shall be signed and dated by the members constituting the Bench concerned. This would Indicate that the date of the order would be the date when the last member signs the Judgment This rule also, therefore, Indicates that on that date all the members should be capable of constituting the Bench since the judgment would be of the Bench. It would be unnecessary to look into the rule for a further stipulation that unless all the members constituting the Bench were available on the date of the final order the order purported to be Issued would not be valid.
16. We are, therefore, satisfied, for the reasons mentioned earlier, that there Is no valid order of the West Regional Bench in pursuance of which action could have been taken under Section 129-C(5) of the Customs Act. As earlier mentioned, the jurisdiction of this Bench to near the matter would arise under the statute as well as under the order for constitution of this Bench by the competent authority in terms of that Section. Since we have held that there is no valid order of the West Regional Bench in pursuance of which further proceedings could be held under Section 129-C(5), it appears to us that it would be unnecessary, for the purposes of this case, to go into the other questions such as the proper formulation of the points of difference or the validity of the order dated 8.12.1987 of the Senior Vice President constituting this Bench. As earlier mentioned, even if the findings on these two points are to be against the Department this Bench would not be entitled to hear the matter in view of our finding on the first point urged for the Department. Hence, we do not record any findings on points (ii) and (iii) urged by Shri Chandrasekharan.
17. Following the finding on point No. (I) urged for the Department, we hold that the proceedings before this Bench are Incompetent and that appeals will have to be heard afresh by the West Regional Bench.