Wp(Md)/16943/2014 Of G.mariappan v. The Deputy Commissioner Of Income Tax In W.p

BEFORE THE MADURAI BENCH OF MADRAS HIGH COURT THE HONOURABLE MR.JUSTICE S.M.SUBRAMANIAM G.Mariappan... Petitioner The Deputy Registrar of Co-operative Societies,Srivilliputhur Circle,Virudhunagar District.... Respondent Prayer: Writ Petition filed under Article 226 of the Constitution ofIndia, to issue a Writ of Certiorari, to call for the recordsrelating to the impugned proceedings issued by the respondent inTha.Na.No.01/2013-2014 (Na.ka.4122/11/Sa.Pa), dated 04.06.2014 andto quash the same insofar as the petitioner is concerned . ORDER The sur-charge order issued under Section 87 of the TamilNadu Co-operative Societies Act, dated 04.06.2014, is underchallenge in the present writ petition. 2.The writ petitioner was employed in combined RamanathapuramDistrict Central Co-operative Bank Limited and retired from serviceon attaining the age of superannuation on 31.08.1998. On account ofthe allegation of causing financial loss to the bank, the surchargeproceedings were initiated against the petitioner under Section 87of the Act and after adjudication, the competent autority, namely,the Deputy Registrar of Co-operative Societies passed a final orderin the surcharge proceedings under Section 87 of the Act inproceedings, dated 04.06.2014. Challenging the said order, thehttps://hcservices.ecourts.gov.in/hcservices/present writ petition is filed. 3.This Court is of the opinion that the present writpetition cannot be entertained, in view of the fact that against thefinal orders passed under Section 87 of the Tamil NaduCo-operative Societies Act. The aggrieved persons has to approachthe Special Tribunal for Co-operative Cases / Principal DistrictJudge of the concerned District under Section 152 of the Tamil NaduCo-operative Societies Act. Thus, the statutory appeal is providedand the Special Tribunal for Co-operative Cases are instituted bythe Government under the provisions of the Act. The SpecialTribunal for Co-operative Societies are now presided over by thePrincipal District Judge concerned and therefore, the writpetitioner is having an efficacious alternate remedy under theprovisions of the Act. Over looking such efficacious alternateremedy is not preferrable. Exhausting such remedy provided underthe statute is the proper remedy and entertaining a writ petitionunder Article 226 of the Constitution of India is an exception.This apart, certain disputed issues raised by the respective partiescannot be adjudicated in writ proceedings under Article 226 of theconstitution of India. Thus, the writ petitioner has to exhaust thealternate appeal remedy provided under Section 152 of the Act bypreferring an appeal before the Special Tribunal for Co-operativeCases / Principal District Judge concerned, for the purpose ofadjudication to issues in respect of exhausting the alternateremedy. This Court has exclusively dealt with the issues, withreference to the Judgment of the Hon'ble Supreme Court of India, inthe case of M/s.Hyundai Motor India Limited Vs. The DeputyCommissioner of Income Tax in W.P.No.22508 of 2017, dated 16.07.2018and the relevant paragraphs are extracted hereunder:- “...19.Unnecessary or routine invasion into thestatutory powers of the competent authorities under astatute should be restrained by the ConstitutionalCourts. Frequent or unnecessary invasions in theexecutive power will defeat the constitutionalperspectives enshrined under the Constitution of India.Undoubtedly, the separation of powers under the IndianConstitution has been narrated and settled in umpteennumber of judgments. Separation of powers demarcated inthe Constitution of India is also to be considered, whileexercising the powers of judicial review in the matter ofdispensing with the appeal remedy provided for anaggrieved person under a statute. If the High Courtsstarted interfering with such Appellate powers withoutany valid and substantiated reasons, then the verypurpose and object of the statute and provision of appealunder the statute became an empty formality and the HighCourts also should see that the provisions of appealcontemplated under the statutes are implemented in itsreal spirit and in accordance with the procedureshttps://hcservices.ecourts.gov.in/hcservices/contemplated under the rules constituted thereon. While entertaining a writ petition as narrated by the ApexCourt, the provision of efficacious alternative remedyunder the statute also to be considered. If the writpetitions are entertained in a routine manner, by notallowing the competent Appellate authority to exercisetheir powers under the provisions of the statute, thenthis Court is of an opinion that the power of judicialreview has not exercised in a proper manner. Thus, it isnecessary for this Court to elaborate the legal principlesettled in respect of the separation of powers under theConstitution of India. 1. Madras Bar Association vs. Union of India (UOI)(25.09.2014 - SC) : MANU/SC/0875/2014 If the historicalbackground, the preamble, the entire scheme of theConstitution, relevant provisions thereof includingArticle 368 are kept in mind there can be no difficultyin discerning that the following can be regarded as thebasic elements of the constitutional structure. (Thesecannot be catalogued but can only be illustrated): (1) The supremacy of the Constitution. (2) Republican and Democratic form of government andsovereignty of the country. (3) Secular and federal character of the Constitution. (4) Demarcation of power between the Legislature, theexecutive and the judiciary. (5) The dignity of the individual secured by the variousfreedoms and basic rights in Part III and the mandate tobuild a welfare State contained in Part IV. (6) The unity and the integrity of the Nation. 2. Holiness Kesavananda Bharati Sripadagalvaru v.State of Kerala and Anr. [MANU/SC/0445/1973 : (1973) 4SCC 225]. That separation of powers between the legislature, theexecutive and the judiciary is the basic structure of theConstitution is expressly stated by Sikri, C.J. 3. P. Kannadasan and Ors. v. State of T.N. andOrs. [MANU/SC/0650/1996 : (1996) 5 SCC 670] the SupremeCourt noted that the Constitution of India recognised thedoctrine of separation of powers between the three organsof the State, namely, the legislature, the executive andthe judiciary. The Court said: It must be remembered that our Constitution recognisesand incorporates the doctrine of separation of powersbetween the three organs of the State, viz., thehttps://hcservices.ecourts.gov.in/hcservices/ Legislature, the Executive and the Judiciary. Even thoughthe Constitution has adopted the parliamentary form ofgovernment where the dividing line between thelegislature and the executive becomes thin, the theory ofseparation of powers is still valid. 3. P. Kannadasan and Ors. v. State of T.N. andOrs. [MANU/SC/0650/1996 : (1996) 5 SCC 670] the SupremeCourt noted that the Constitution of India recognised thedoctrine of separation of powers between the three organsof the State, namely, the legislature, the executive andthe judiciary. The Court said: It must be remembered that our Constitution recognisesand incorporates the doctrine of separation of powersbetween the three organs of the State, viz., thehttps://hcservices.ecourts.gov.in/hcservices/ Legislature, the Executive and the Judiciary. Even thoughthe Constitution has adopted the parliamentary form ofgovernment where the dividing line between thelegislature and the executive becomes thin, the theory ofseparation of powers is still valid. 4. State of Tamil Nadu and Ors. vs. State ofKerala and Ors. (07.05.2014 - SC) : MANU/SC/0425/2014 121. On deep reflection of the above discussion, in ouropinion, the constitutional principles in the context ofIndian Constitution relating to separation of powersbetween legislature, executive and judiciary may, inbrief, be summarized thus: (i) Even without express provision of theseparation of powers,the doctrine of separation of powersis an entrenched principle in the Constitution of India. The doctrine of separation of powers informs theIndian constitutional structure and it is an essentialconstituent of rule of law. In other words, the doctrine of separation of powerthough not expressly engrafted in the Constitution, itssweep, operation and visibility are apparent from thescheme of Indian Constitution. Constitution has madedemarcation, without drawing formal lines between thethree organs- legislature, executive and judiciary. Inthat sense, even in the absence of express provision forseparation of power, the separation of power betweenlegislature, executive and judiciary is not differentfrom the constitutions of the countries which containexpress provision for separation of powers. (ii) Independence of courts from the executive andlegislature is fundamental to the rule of law and one ofthe basic tenets of Indian Constitution. Separation of judicial power is a significantconstitutional principle under the Constitution of India. (iii) Separation of powers between three organs--legislature, executive and judiciary--is also nothing buta consequence of principles of equality enshrined inArticle 14 of the Constitution of India. Accordingly,breach of separation of judicial power may amount tonegation of equality Under Article 14. Stated thus, alegislation can be invalidated on the basis of breach ofthe separation of powers since such breach is negation ofequality Under Article 14 of the Constitution. (iv) The superior judiciary (High Courts andSupreme Court) is empowered by the Constitution tohttps://hcservices.ecourts.gov.in/hcservices/declare a law made by the legislature (Parliament and State legislatures) void if it is found to havetransgressed the constitutional limitations or if itinfringed the rights enshrined in Part III of theConstitution. (v) The doctrine of separation of powers appliesto the final judgments of the courts. Legislature cannotdeclare any decision of a court of law to be void or ofno effect. It can, however, pass an amending Act toremedy the defects pointed out by a court of law or oncoming to know of it aligned. In other words, a court's decision must alwaysbind unless the conditions on which it is based are sofundamentally altered that the decision could not havebeen given in the altered circumstances. State legislatures) void if it is found to havetransgressed the constitutional limitations or if itinfringed the rights enshrined in Part III of theConstitution. (v) The doctrine of separation of powers appliesto the final judgments of the courts. Legislature cannotdeclare any decision of a court of law to be void or ofno effect. It can, however, pass an amending Act toremedy the defects pointed out by a court of law or oncoming to know of it aligned. In other words, a court's decision must alwaysbind unless the conditions on which it is based are sofundamentally altered that the decision could not havebeen given in the altered circumstances. (vi) If the legislature has the power over thesubject-matter and competence to make a validating law,it can at any time make such a validating law and make itretrospective. The validity of a validating law,therefore, depends upon whether the legislature possessesthe competence which it claims over the subject-matterand whether in making the validation law it removes thedefect which the courts had found in the existing law. 20.This Court is of a strong opinion thatinstitutional respects are to be maintained by theconstitutional Courts. Whenever there is a provision foran appeal under the statute, without exhausting theremedies available under the statute, no writ petitioncan be entertained in a routine manner. Only onexceptional circumstances, the remedy of appeal can bewaived, if there is a gross injustice or if there is aviolation of fundamental rights ensured under theConstitution of India. Otherwise, all the aggrievedpersons from and out of the order passed by the originalauthority is bound to approach the Appellate Authority.The Constitutional Courts cannot make an appeal provisionas an empty formality. Every Appellate Authority createdunder the statute to be trusted in normal circumstancesunless there is a specific allegation, which issubstantiated in a writ proceedings. Thus, theinstitutional functions and exhausting the appealremedies by the aggrieved persons, are to be enforced inall circumstances and writ proceedings can be entertainedonly on exceptional circumstances. Rule is to prefer anappeal and entertaining a writ is only an exception. Thisbeing the legal principles to be followed, this Courtcannot entertain the writ petitions in a routine mannerhttps://hcservices.ecourts.gov.in/hcservices/ by waiving the remedy of appeal provided under thestatute. 22.When an effective alternative remedy isavailable, a writ petition cannot be maintained 1. In City and Industrial Development Corporation v. DosuAardeshirBhiwandiwala and Ors. MANU/SC/8250/2008 :(2009) 1 SCC 168, this Court had observed that: The Court while exercising its jurisdiction under Article226 is duty-bound to consider whether: (a) adjudication of writ petition involves any complexand disputed questions of facts and whether they can besatisfactorily resolved; (b) the petition reveals all material facts; (c) the Petitioner has any alternative or effectiveremedy for the resolution of the dispute; (d) person invoking the jurisdiction is guilty ofunexplained delay and laches; (e) ex facie barred by any laws of limitation; (f) grant of relief is against public policy or barred byany valid law; and host of other factors. 2. KanaiyalalLalchand Sachdev and Ors. vs. Stateof Maharashtra and Ors. (07.02.2011 - SC) :MANU/SC/0103/2011 It is well settled that ordinarilyrelief Under Articles 226/227 of the Constitution ofIndia is not available if an efficacious alternativeremedy is available to any aggrieved person. (See SadhanaLodh v. National Insurance Co. Ltd.; Surya Dev Rai v. RamChander Rai and SBI v. Allied Chemical Laboratories.) 3. Commissioner of Income Tax and Ors. v.ChhabilDass Agarwal, MANU/SC/0802/2013 : 2014 (1) SCC603, as follows: (d) person invoking the jurisdiction is guilty ofunexplained delay and laches; (e) ex facie barred by any laws of limitation; (f) grant of relief is against public policy or barred byany valid law; and host of other factors. 2. KanaiyalalLalchand Sachdev and Ors. vs. Stateof Maharashtra and Ors. (07.02.2011 - SC) :MANU/SC/0103/2011 It is well settled that ordinarilyrelief Under Articles 226/227 of the Constitution ofIndia is not available if an efficacious alternativeremedy is available to any aggrieved person. (See SadhanaLodh v. National Insurance Co. Ltd.; Surya Dev Rai v. RamChander Rai and SBI v. Allied Chemical Laboratories.) 3. Commissioner of Income Tax and Ors. v.ChhabilDass Agarwal, MANU/SC/0802/2013 : 2014 (1) SCC603, as follows: Para 15. while it can be said that this Court hasrecognised some exceptions to the Rule of alternativeremedy i.e. where the statutory authority has not actedin accordance with the provisions of the enactment inquestion, or in defiance of the fundamental principles ofjudicial procedure, or has resorted to invoke theprovisions which are repealed, or when an order has beenpassed in total violation of the principles of naturaljustice, the proposition laid down in ThansinghNathmalcase, Titaghur Paper Mills case and other similarjudgments that the High Court will not entertain apetition Under Article 226 of the Constitution if aneffective alternative remedy is available to thehttps://hcservices.ecourts.gov.in/hcservices/ aggrieved person or the statute under which the actioncomplained of has been taken itself contains a mechanismfor redressal of grievance still holds the field.Therefore, when a statutory forum is created by law forredressal of grievances, a writ petition should not beentertained ignoring the statutory dispensation. 4. Authorized Officer, State Bank of Travancoreand Ors. vs. Mathew K.C. (30.01.2018 - SC) :MANU/SC/0054/2018 The petitioner argued that the SARFAESIAct is a complete code by itself, providing forexpeditious recovery of dues arising out of loans grantedby financial institutions, the remedy of appeal by theaggrieved under Section 17 before the Debt RecoveryTribunal, followed by a right to appeal before theAppellate Tribunal under Section 18. The High Court oughtnot to have entertained the writ petition in view of theadequate alternate statutory remedies available to theRespondent. The interim order was passed on the veryfirst date, without an opportunity to the Appellant tofile a reply. Reliance was placed on United Bank of Indiavs. Satyawati Tandon and others, 2010 (8) SCC 110, andGeneral Manager, Sri Siddeshwara Cooperative Bank Limitedand another vs. Ikbal and others, 2013 (10) SCC 83. Thewrit petition ought to have been dismissed at thethreshold on the ground of maintainability. The DivisionBench erred in declining to interfere with the same. TheSupreme Court agreed to the arguments and held the samealso noted that the writ petition ought not to have beenentertained and the interim order granted for the mereasking without assigning special reasons, and that toowithout even granting opportunity to the Appellant tocontest the maintainability of the writ petition andfailure to notice the subsequent developments in theinterregnum. 5. State of Himachal Pradesh v. Gujarat AmbujaCement Ltd. reported at AIR 2005 SC 3856, the SupremeCourt explained the rule of 'alternate remedy' in thefollowing terms Considering the plea regardingalternative remedy as raised by the appellant-State.Except for a period when Article 226 was amended by theConstitution (42nd Amendment) Act, 1976, the powerrelating to alternative remedy has been considered to bea rule of self imposed limitation. It is essentially arule of policy, convenience and discretion and never arule of law. Despite the existence of an alternativeremedy it is within the jurisdiction of discretion of theHigh Court to grant relief under Article 226 of theConstitution. At the same time, it cannot be lost sighthttps://hcservices.ecourts.gov.in/hcservices/of that though the matter relating to an alternative remedy has nothing to do with the jurisdiction of thecase, normally the High Court should not interfere ifthere is an adequate efficacious alternative remedy. Ifsomebody approaches the High Court without availing thealternative remedy provided the High Court should ensurethat he has made out a strong case or that there existgood grounds to invoke the extraordinary jurisdiction. 6. K.S. Rashid and Sons v. Income TaxInvestigation Commission and Ors., AIR (1954) SC 207;Sangram Singh v. Election Tribunal, Kotah and Ors., AIR(1955) SC 425; Union of India v. T.R. Varma, AIR (1957)SC 882; State of U.P. and Ors. v. Mohammad Nooh, AIR(1958) SC 86 and M/s K.S. Venkataraman and Co. (P) Ltd.v. State of Madras, AIR (1966) SC 1089, ConstitutionBenches of the Supreme Court held that Article 226 of theConstitution confers on all the High Courts a very widepower in the matter of issuing writs. However, the remedyof writ is an absolutely discretionary remedy and theHigh Court has always the discretion to refuse to grantany writ if it is satisfied that the aggrieved party canhave an adequate or suitable relief elsewhere. The Court,in extraordinary circumstances, may exercise the power ifit comes to the conclusion that there has been a breachof principles of natural justice or procedure requiredfor decision has not been adopted. 7. First Income-Tax Officer, Salem v. M/s. ShortBrothers (P) Ltd., [1966] 3 SCR 84 and State of U.P. andOrs. v. M/s. Indian Hume Pipe Co. Ltd., [1977] 2 SCC 724. There are two well recognized exceptions to thedoctrine of exhaustion of statutory remedies. First iswhen the proceedings are taken before the forum under aprovision of law which is ultra vires, it is open to aparty aggrieved thereby to move the High Court forquashing the proceedings on the ground that they areincompetent without a party being obliged to wait untilthose proceedings run their full course. Secondly, thedoctrine has no application when the impugned order hasbeen made in violation of the principles of naturaljustice. We may add that where the proceedings itself arean abuse of process of law the High Court in anappropriate case can entertain a writ petition. 23.Considering the above judgments of the ApexCourt, this Court is of an opinion that the writpetitioner has not established that there is a violationof principles of natural justice nor there is an errorapparent on record. No exceptional circumstances havehttps://hcservices.ecourts.gov.in/hcservices/ 23.Considering the above judgments of the ApexCourt, this Court is of an opinion that the writpetitioner has not established that there is a violationof principles of natural justice nor there is an errorapparent on record. No exceptional circumstances havehttps://hcservices.ecourts.gov.in/hcservices/ been established in the present writ petition. If at all,the writ petitioner is aggrieved in respect of the fixingof average rate of royalty payment, then it is left opento them to approach the Disputes Resolution Panel andthereafter, if they are further aggrieved in respect ofthe fixing of average rate of royalty payment, then theyare liberty to approach the ITAT constituted for thepurpose of adjudicating the issues. This being theefficacious remedy available under the statute for thewrit petitioner, there is no reason to entertain a writpetition under Article 226 of the Constitution of India,so as to adjudicate the merits and the demerits nowraised before this Court in the present writ petition inrespect of fixing of average rate of royalty payment...” 4.In view of the Judgment cited supra, the writ petitionerhas to approach the competent forum, namely, the Special Tribunalfor Co-operative Cases constituted under Section 152 of the TamilNadu Co-operative Societies Act 1983. The writ petitioner is atliberty to do so. In the event of preferring any appeal withcondone delay application, the period of pendency of the writpetition also to be considered for condoning the delay by thetribunal. 5.With these observations, the writ petition standsdismissed. No costs. Consequently, connected miscellaneous petitionis closed. Sd/-Assistant Registrar (CO) ToThe Deputy Registrar of Co-operative Societies,Srivilliputhur Circle, Virudhunagar District. +1 CC to M/s.F.DEEPAK, Advocate ( SR-80980[F] dated 09/08/2019 )+1 CC to M/s.SPL GP ( SR-81525[F] dated 13/08/2019 )