'  NATWAR TEXTILE PROCESSORS PVT. LTD. AND ANR. A  

v:  UNION OF INDIA AND' ORS.  

JANUARY 9, 1995  

[B.P. JEEVAN REDDY AND MRS. SUJATA V. MANOHAR, JJ.]  B  

Administration of Justice-Abuse of process of Court-Show cause  notice served in 1983-£.xcise duty allegedly payable by appellant is over  Rupees ten crores-Notice not proceeded with tis appellant filed writ peii,tions C  and appeal~ross abuse of process of cowt-Appellant to pay cost of Rs.  15,000 to respondents-Any duty found payable shall be paid by appellant  with interest @18% p.a. from date of notice upto date of payment-Excise  Authorities to dispose of matter expeditiously-No cowt or Tribunal shall  interdict proceedings until final orders passed.  

A notice dated December 28, 1983 was served upon the appelll!Dt by  the Central Exdse Aothoritles alleging that the appellant bad removed  power loom cotton fabrics worth Rupees sixty two crores without payment  

D  

of adse duty. It was stated that the appellant wroogfolly availed of  exemption ootificatloo and cleared the goods lo an lllidt manner. The  appellant cbullenged the vall"!ty of· the show cause notice by filing a writ E  petition which was dismissed lo September, 1984. Spedal Leave Petition  filed against the judgment of the High Court was also dismissed. The ·  appellant applied to the Central Exdse Aothorltles for Inspection of  certain documents. The request was rejected. The appeUaot filed. a writ  petltl'oo against lhe said refusal and withdrew it without seeking and F  obtaining the leave of the High Court to approach it again. He sought to  file an appeal before the Tribunal which was not maintainable in law. On  the Tribunal expressing a doubt as ·to the maintainability of the appeal,  the appellant withdrew the appeal uocooditlooally. It was dismissed as  withdrawn in May, 1986. Another writ petition was filed, against the very  same orde! of refusal of inspection of documents. The petition could not G  be disposed of early because the records were missing. The records bad to  be re-constructed. The writ petition was dismissed with strong condemna- tion of the appellant's conduct. Special Leave Petition was filed without  disclosing all the facts. The appellant obtained an interim order in Decem- ber, 1989. The SLP was posted only after a period of five years. H  

109

110 SUPREME COURT REPORTS [1995] 1 S.C.R.  

A The appellant submitted that his request for inspection or the docu·  

B  

ments Was justified one. It was also stated that similar request for inspec·  lion or documents was pending consideration in the case or another  

asses see.  

Disposing ol' the matter, this Court  

HELD : 1. The £act in the instant case disclose how persons without  

scruples are abusing the system or administration or justice in this  

country. The courts are therefor honest litigation. Persons like the  

petitioners try to use the courts to advance their oblique .ends and in the  C process the courts, the very system, is getting a bad name, In this case, for  

a period of eleven years, the show cause notice could not be proceeded With.  The appellant had been doing this because he thought that even if he was  

litble to pay any duty pursuant to the show cause notice, he would not be  liable to pay interest thereon since the Central Excise Act did not provide  

for granting of interest. In the circumstances of the case the very liliog of  D the writ petition was a gross abuse of the process of the court and so was  

tile present special leave petition/civil appeal. It is necessary in the ioierest  of justice that such tactics should not be allowed to pass muster and  

should, in no event, ~ allowed to benelit the persons indulging in them.  Stringent terms have to be imposed so that not only the appellant but  

E others minded like him shonld know that they should not play with the  courts and that ir they do so, they should not complain if they are mauled  

in the process. This is the price or abusing the process of court. The court  which is seized or the matter has the undoubted power to make such order  

as it thinks just and necessary to meet the ends or justice. It is the ' .  respondent who has invoked the jurisdiction of the High Court and this  

F Court. [115-H, 116·A·H, 117-A]  

2. The revenue authorities had been lax in not moving for early  disposal of the matter, in this cllurt at any rate. That does not however  explain, condone or justify the conduct of the appellant. So rar as plea or  

G fairness in action is concerned, it is well to remember that fairness is not  a one-way street. The authorities are undoubtedly bound to act fairly but  

so is the assessee • more particularly, when he seeks to invoke the discre·  tionary jurisdiction or the High Court or of this court. No person has a  licence to act unfairly and yet call upon others to act fairly. [117-F-G]  

· H 3. The cost payable by tJie appellant to the respondents are assessed

NA TW AR TEXTILE PROCESSORS v. U.O.I. [JEEV AN"REDDY, J.] 111  

at Rs. 15,000. In case any duty was found payable pursuant to the show A  cause notice mentioned above, the same shall be payable by the appellant  with interest @ 18% p.a. calculated from the date of show cause notice  upto the date of payment. The appropriate Central Excise Authorities shall  dispose of the matter expeditiously and no Court or Tribunal shall inter·  diet the said proceedings until final orders are passed thereon.  

[117-H, 118-A-C]  

CIVIL APPELLATE JURISDICTION : Civil Appeal No. 185 of  1995.  

From the Judgment and Order dated 16.10.89 of the Gujarat High  

B  

Court in S.C.A. No. 2885 of 1986. C  

Ashok H. Desai, Barish N. Salve, S. Ganesh and Ms. Bina Gupta for  the Appellants.  

J. Vellapally and P. Parmeswaran for the Respondents.  

The Judgment of the Court was delivered by  

B.P. JEEV AN REDDY, J. Leave granted. Heard counsel for the  parties.  

D  

This appeal arises from the judgment and order of the Gujarat High E  Court dismissing the writ petition filed by the appellant, being S.CA. No.  2885 of 1986. The writ petition filed in the High Court and the Special  Leave Petition filed in this Court against the judgment of the High Court  do, in our opinion, amount to gross abuse of process of court, a fact which  would be evident from the facts stated hereinafter. We are taking the facts F  from the judgment of the High Court and we may mention that the  correctness of none of those facts is disputed before us.  

A notice dated December 28, 1983 was served upon the appellant by  the Central Excise Authorities alleging that the appellant had clandestinely  removed power loom cotton fabrics worth Rupees sixty two crores without G  payment of excise duty during the period November 24, 1979 to July 31,  1983. The allegation was that the appellant wrongfully availed of exemption  notification and cleared the goods in an illicit manner. The appellant  challenged the validity of the said show cause notice by filing a writ petition  in the Gujarat High Court, being S.C.A. No. 4611 -of 1984, which was  disposed of on September 13, 1984 under the following order : H

A  

B  

c  

D  

E  

F  

G  

112 SUPREME COURT REPORTS (1995] 1 S.C.R.  

"No final action pursuant to the show cause notice had been taken.  It is for the petitioners to show cause. Their complaint before us is  that ceTtain documents on which tf1ey would like to rely, though the  excise auth01ities have indicated that they do not propose to rely on  them, are not made available to them despite their request and this  may vitiate the proceedings now taken as it would be in violation of  the principles or natural justice. Though we have been addressed  elaborately by the petitioners' counsel, we have not been persuaded  to agree that interference at this stage is called for. It is open to  the petitioners to urge all their contentions in answer to the show  

cause notice including their contention as to why the copies of the  documents sought for by them are necessary for the proper con- duct of their defence and as to how non supply of those copies  would vitiate the proceedings. We expect the excise authorities to  properly look into . all the contentions taken by the petitioners  including the contention of non-supply of copies. It is not necessary  to consider in this petition whether those copies would be relevant  and whether if not supplied now, the proceedings would have been  held to be bad.  

We do not think, on the facts averred in the petition, any case  has been made out for interference. Hence we are dismissing the  petition as premature. Dismissed."  

(Emphasis added)  

Against the said order of the High Court, the appellant approached  this court by way of Special Leave Petition (C) No. 11569 of 1984, which  was dismissed on May 6, 1985 under the following order :  

"The point as to the limitation before us can be raised in reply to  the show cause notice received by the petitioners. The request for  inspection of documents can also be raised by the petitioners, before  the Collector of Customs, Central Excise. We trust that the request  will be duly considered. The Special leave petition is dismissed  accordingly".  

(Emphasis added)  

H Meanwhile, the appellant had applied to the Central Excise

NATWAR TEXTILE PROCESSORS v. U.0.l. [JEEV AN REDDY, J.] 113  

Authorities for inspection of certain documents on July 16, 1984. It is A  evidently this request which finds a mention in the order of this court  aforesaid. This request was rejected by the authorities on December 16,  1985. The appellant then approached the Gujarat High Court by way of  S.C.A. No. 317 of 1986 questioning the refusal of inspection of documents  asked for by him. When the writ petition came up for hearing before a B  Division Bench on March 18, 1986, the appellant sought to withdraw the  writ petition. It was dismissed as withdra"n under the following order :  

"Mr. V.N. Nair on behalf of Mr. SJ. Nanavati wants permission of  the court to withdraw this petition as not pressed reserving liberty  to agitate this matter as and when he files an appeal td the Tnounal C  against the order of the Collector if at all such an eventuality arises.  Permission to withdraw is granted with the above said observations  and as such this writ petition is dismissed as withdrawn."  

(Emphasis added)  

It is obvious that the appeal to the Tribunal contemplated in the  aforesaid order was an appeal against the final orders passed pursuant to  the show cause notice. The idea was that the appellant can raise all  questions which are open to him in law in such appeal. However, seeking  

D  

to mis-interpret the said order of the High Court, the appellant filed an E  appeal before the CEGAT against the very same order dated December  16, 1985. On the Tribunal expressing a doubt as to the maintainability of  the appeal, the appellant withdrew the appeal unconditionally. It was  dismissed as withdrawn on May 15, 1986.  

Within two weeks of the dismissal of its appeal by the Tribunal, the F  appellant again approached the Gujarat High Court, during the summer  vacations, in the last week of May 1986. The prayers in the writ petition  are to the following effect :  

"(A) This Hon'ble Court may be pleased to issue writ of mandamus G  and/or any other writ in the nature of mandamus directing the  respondents to give the inspection of the documents mentioned as  serial Nos. 1, 2 and 4 in the letter dated 16th July, 1984 which is  at Annexure-D to this petition.  

(B) The Hon'ble Court may issue an appropriate writ, mandamus H

114 SUPREME COURT REPORTS (1995] 1 S.C.R.  

A or direction or order quashing and setting aside the order passed  by the Collector or Central Excise and customs, Baroda dated 16th  December, 1985 which is at Annexure-C to this petition."  

B  

It is evident that the writ petition was directed against the very same  order of the Excise Authorities (dated December 16, 1985) which was  already the subject matter of S.C.A. No. 317 of 1986, which was dismissed  as withdrawn without reserving any liberty to the appellant to approach the  High Comt again md which was also the subject matter of appeal before  the Tribunal which too was withdrawn by the appellant unconditionally.  Even so, the appellant succeeded in obtaining an interim order from the  

C High Court on June 23, 1986 which order was extended to September 1,  1986 pending final orders. While extending the interim order, the court  directed the matter to be posted for admission on September 22, 1986. It  did not so come up for admission, whereupon, the respondents (Central  Excise Authorities) moved the court for hearing the matter. It was found  

D that the record was missing. By an order dated October 7, 1989, the court  directed the record to be reconstructed and thereafter it was posted before  a Division Bench for final hearing. The above facts impelled the High  Court to make the following observations :  

E  

F  

G  

H  

"It is rather shocking and much painful to note that the matter filed  in the year 1986 has remained at the admission stage till today.  The facts disclosed prima facie reveal a very distressing state of  affairs. Had it been a matter pertaining to lower court or any other  Government Department we ourselves would have given ap- propriate directions for holding inquiry and for suitable actions to  be taken against persons responsible for such lamentable lapse.  However, since the question pertains to the administration of the  High Court itself, we ourselves would rather refrain from passing  any such order. But we direct: the Registrar of the High Court to  place a copy of this judgment before the learned Chief Justice  drawing his attention to this aspect. We hope and trust that the  learned Chief Justice will take suitable effective actions in the  matter, with a view to find out as to who is responsible for the  disappearance of t~e papers and why this was not brought to the  notice of the learned Chief Justice or to the notice of Court taking  up such matters and what steps are required to be taken for  preventing recurrence of such incidents. We hope and trust that

NATWAR TEXTILE PROCESSORS v. U.0.1. [JEEV AN REDDY, J.) 115  

suitable effective actions will be taken against persons who may be A  found responsible for causing disappearance of the papers and  also against persons who did not and/or could not prevent such  things to happen."  

The writ petition was accordingly dismissed.  

In the Special Leave Petition filed in this court, the following order  was made on December 11, 1989 :  

B  

"Issue notice on the special le~ve petition returnable on 6.2.90,  state in the notice that the matter will be disposed of at the notice  stage. In the meantime proceedings may go on but no final order C  will be passed.  

It is stated that the proceedings are at the stage where the  cross-examination of the )Vitnesses called by the department is in  

progress. It is further stated that the diaries which are the subject D  matters of this adjudications the witnesses called will not be cross- examined. In that view of the mat(\:r proceedings to that extent are  stayed."  

The record does not disclose that the Special Leave Petition was  posted on February 2, 1990 as directed in the aforesaid order. It was posted E  only sometime towards the end of 1994. It is not known who is responsible  for this state of affairs. This Court intended that the matter will be disposed  of at the notice stage itself soon after the service of the notice on the  respondents. The notice on the respondents was served immediately and  in fact they filed their counter-affidavit as early as March 26, 1990. Even F  so, the matter was not posted before the court. It is equally surprising that  the respondents too did not choose to take any steps for having the matter  posted early. The Registrar General is directed to bring this matter to the  notice of the Hon'ble Chief Justice for appropriate action to determine the  culpability, if any, of any member or members of the registry of this Court G  in not carrying out the orders aforesaid.  

The facts stated above disclose how persons without scruples are  

abusing the system of administration of justice in this country. They forget  that the courts are there for honest litigation. They think and they try to  use the courts to advance their oblique ends and in the process the courts, H

116 SUPREME COURT REPORTS [1995] 1 S.C.R.  

A the very system, is getting a bad name. Look at the facts of this case. The  show cause notice was issued in December, 1983. It was questioned imme- diately by the appellant by way of a writ petition which was dismissed in  September, 1984. The appellant carried the matter to this court, which was  dismissed in May, 1985. Meanwhile, he had applied for inspection of  

B certain documents, which was rejected in December, 1985. He filed a writ  petition against the said refusal and withdrew it without seeking and  obtaining the leave of the High Court to approach it again. Trying to  mis-interpret the orders of the High Court, he sought to file an appeal  before the Tribunal which was not najntainable in law. When that was  

C pointed out, he withdrew it unconditionally. Then he filed another writ  petition against the very same order of December, 1985 which was the  subject matter of S.C.A. No. 317 of 1986 in the Gujarat High Court and an  appeal· before the CEGAT, both of which were withdrawn unconditionally.  This latest writ petition could not be. disposed of early because the records  were said to be missing; the records had to be re-constructed. The writ  

D petition was dismissed with strong condemnation of the appellant's con- duct. In spite of the same, the appellant comes to this court and evidently  without disclosing all the facts, obtained an interim order in December,  1989. Though this court intended to dispose of the matter within a couple  of months, the Special Leave Petition did not see the light of the day for  

E a period of about five years with the result that a period of eleven years,  the show cause notice could not be proceeded with. The appellant has been  doing this because he thinks that even if he is liable to pay any duty  pursuant to the show cause notice, he would not be liable to pay interest  thereon since the Act does not provide for granting of interest. According  

F to the show cause notice, the duty payable is over Rupees ten crores. In  our opinion, the very filing of the writ petition, S.C.A 2885 of 1986, is a  gross abuse of the process of the court and so is the present Special Leave  Petition/Civil Appeal. It is necessary in the interests of justice that such  tactics should not be allowed to pass muster and should, in no event, be  

G allowed to benefit the persons indulging in them. Stringent terms have to  be imposed so that not only the appellant but others minded like him  should know that they should not play with the courts and that if they do  so, they should not complain if they are mauled in the process. This is the  price of abusing the process of court. The court which is seized of the  matter has the undoubted power to make such orders as it thinks just and  

H

NATWAR TEXTILE PROCESSORSv. U.0.1. [JEEV AN REDDY, J.J 117  

necesspy to meet the ends of justice. It should be remembered that it is A  the respondent who has invoked the jurisdiction of the High Court and this  

Court.  

Sri Ashok Desai, learned' counsel for the appellant submitted that his  

request for inspection of the documents is a justified one and that all that B  the appellant wanted to know was the names of the officers who visited the  appellants' factory, the dates and time of their visit so as to enable it to  defend itself effectively. We are, however, not prepared to entertain the  said submission inasmuch as the Gujarat High Court had rejected this very  submission in the earlier writ petition, S.C.A. No. 317 of 1986, with the  

observation that all these questions can be agitated by the appellant as and C  when he files an appeal before the Tribunal against the orders of the  

Collector, in case the Collector decides against him. The said order has  become final and cannot be re-opened in a subsequent writ petition.  

The appellant has filed written submission wherein it is stated that a D  similar request for inspection of documents is pending consideration in the  

case of another assessee in S.L.P. (C) No. 22023 of 1993 Bir/a Jute  Industries v. Union of India. The appellant has also sought to make out a  justification for his request for inspection. However, for the reasons stated  above, the said· submission could not have been raised in the writ petition E  from which this appeal arises for the reason stated in the preceding para.  The appellant has also sought to blame the Central Excise Authorities for  not moving fast for vacating the orders passed by the court or for early  disposal. We are surprised at this logic. While we agree that the revenue  authorities have been lax in not moving for early disposal of the matter, in  this court at any rate, that does not explain, condone or justify the conduct F  of the appellant. So far as plea of fairness in action is concerned, it is well  to remember that fairness is not a one-way street. The authorities are  undoubtedly bound to act fairly but so is the assessee - more particularly,  when he seeks to invoke the discretionary jurisdiction of the High Court  or of this court. No person has a licence to act unfairly and yet call upon G  others to act fairly.  

For the above reasons, the civil appeal is dismissed with costs. The  costs payable by the appellant to the respondents are assessed at Rs.  15.000. It is further directed that in case any duty is found payable pursuant H

118 SUPREME COURT REPORTS (1995] 1 S.C.R.  

A to the show ~ause notice mentionecl above, the same small be payable by  the appellant with interest @ 18% p.a. calculated from the date of show  cause notice upto the date of payment. It is also directed that the ap- propriate Central Excise Authorities shall dispose of the matter ex- peditiously and that no Court or Tribunal shall interdict the said  

B proceedings until final orders are passed thereon.  

A.G. Appeal disposed of.