VNION OF INDIA AND 0THERS

v. .

OSWAL WOOLLEN MILLS LTD. AND. OTHERS

'.B

• March 27, 1984

[(). CmNNAPPA REom< A.P. SEN AND E.S. VENKATARAMIAH, JJ.J

lmpori Control Order, 1955. CtaU.se 8-B-Writ petitlon by company_impug- C ring order un, der Clause 8-Bgrant of exjJarte lnteri111 stay by lfigh Court

M•hether 11nlid and , legal. ·

Practice ·& Procedu, e-Statqtoty Or; lers-Grant o.f exparte interim stay by Courts.:..validity of. '

Petitiner company.situated in Punjab-Relief sought against Union Of lnd; fl" .· situated in New Delhi-Writ petition in Calculta High Cor1t-Fllig of whether vafid-

The respondeflts filed. a Writ petition in the High Court. of Calcutta against an order made under Clause 8-B of the Import Control ordr 1955, in respect or a consignffient of beef tallow \vhich arrived.at the Calcutta Port. A Single Judge

isue4_ a rule-andranted an interim ordey restrainin& the Union of India" and -the Chief Controller of ImP.orts and Export,<; from fil ihg any criminal complaint against the respotident-firm or its Directors and also a direction to pCrmit the: . respondents to re-export the consignment of tallow. A.n application \vas madeby the-Union of India to vacate the interim order, In the mean\vJ1ile the respOndents sent letters and telegtams to. the departn1ent. intimating that. the interim order of the High .Court had not been obeyed, and, threatening actioa for contempt of Court,' An application to co_.11mit _the Chief Controller or Imports ad Exports, and others for contept Of c9urt was filed by the com- .pany. Over-ruUng the request made on behalf of the Department to vacate the

iriterim order, the cou'tt issued a rule in the application for conten1pt and direc~ ted the..r>epar.ti; nent officials.to appear i~ person.

Bein'g aggrieved by the ot;:der, the Department filed'!- Special Leave Petition against the interim order a.nd the rule for contempt.

Allowing the appeal, vacating the ifiterim orde! and quashing the !ule fOi::- -contempt" of Coutt ;· ·

HELD: I. Writ' petitions .are often deliberalely filed in distant High B . ,,. Coitfts, s.part of a manoeuvre ia legal battI~, so as. to fenPer it difficult r°""·

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L"J-; JON 'v. OSWAL.WOOLLEN MILLS, 343. . . . . • the' ffici:ils at D!lhi to cio_v>!· appliction<J to. vaca~~ _stay where it becomes

.A

- • 11eCessary to file such applications. 'An .irieitable. 'reult or ihe filing or' writ

l)Ctitions -elsewhere_ than at, tl1t viace her~ the concernedOffi;::cs and. ihe re1e-.

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--vant recOrds re localed is to d.!l~Y proJVpt retul-n and contest. [345BC, A) . . . .

- Jo ; he i~tant-~<>t. th'! rit pel; tiOn w~'i flied. in the .Calctta .Hih- _Curt: --When the pl'fx:e oftJie c"fn)1dny-is-in th~ Staie c.'f Pu.jab and all the prin.ciPat Tespondnts r.: in.Delhi. ' · . . , .. -·

2. A 'St1rurory or Je; a:h" a:; th~ Ol)e ~der" Clause 8-R of_ the Import . Control Ordet purporis to be made'. in the pub Ii.: interest and Unless there are

yen strogr grOupcls 'Or" rublic interest ari x.'p:a'rte intefrn Order ~:ill nOt be.

, :jll5tified •. T~: illy rippl"ep_riatt'oi"dei 10 m?ke in .. suCli cses is_'tO _issue notlce tO . a

- the respondents. and make it rclurnable" \vithin a !-hortperiod.'This should parti.,; , culafy bC so where 'the--Offi.:~~ of th.: Principal respondents and reieVant reCofdS •' lie. outside the. odinary juisdiction or the C<?urt. '.To , grant ·. interi_Ill relief

traight away and 1eave it_ to.therespondents to h_ave the interim order vacat'=<! may j:::opJ.rdi'>e th~ p_ublic-interest- [346G-J47A] ' . .· . . - ' '' . . . ..

. _3. -1{3.n intenm or:ler. is one.! m1d6 by a cou'r"t, parties 'employ every_ -device and tactic to wa~ off the final hearing or he applicatioa. It is theeT'. fore. necessary for the courti to be circumsp.:ct in the matter or granting . inerim relier. more particularlyso where the interi~ relief is direcied against.: ·,

:0rders Ur actions of public officials actipg in discharge of their public duty _and in' exercise Or statutory powefs. C347BJ ·.. . . .. , . ·. . -· . . . ·.

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: ·; In th~ instant case, :no inierim relier Should hav~ been grantCd by the

High

. ·Collft. The. futerim, order iS Of a drastic character With a great potential for

~ mischief and has. the effect or prcictically _aIJOwing the writ petition at the stage

Or admission wit!loUt hearing the appoire P<irties. [347C, 3460] . . . . _/ <

- 4. The application JO cOmmit the allthoritie~ for' cOntelnpt of .ars tO bC a'dcvice to exct licences frOm tbeln~ [349BJ: court appe •

. In the-instant case.- th~ stJ.y of the oeration of the •abeyanCe' orde-r merely mei"nt that the \Vrit petitionCrs were entitled .-to have their applications disposed or bYthe coOcerned -authori!ies. The Hi_gh Court nOt haVing .set .any Jiritit- Or .

.. time for the disposal or the appJic:i.tiOns.· it was -not for the writ petitioiiers tO

'Jrllpo'ie time liffiit and demand that their applicatioris should be disPQ.sed 'of

fofthwith •. If-the writ petltionrs were aggrieved by the failure of thC aUtho.ri .

-tieS to dispose Pf ther ap'plication3 expeditiously, _it was open to them to seek a H. furth_:r direction from the court fixing a limit of_ time Within which the aPplica. . !' . tion!i wer~ to be disJ, OSed of. [348G.J49A] . - . ' \

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' . Sl(PR~MB COURT REPORTS

[1984] 3 S.C.R:

C1viL APPELl; ATB JURISD\CTION : Civil Appeal

No. 19'./2 of 1983

From the Judgment and o'rder dated 22.11.83 Of the Calcutt:¥ High Court in Civil Rule No. 10933 W of 1983 and order is.suillg. conte!llpt notice dated 3:2.84 being Civil Rule No. 571 w.of 1984.

 Milon K. Banerjee, Additional Solicitor General, A.K.

Ganguli an4 R.N. Poddar for th~ appellauts. ·

. Soli J. Sorabjee, Mrs. Manik Karanjawa!a, Ratan Karanjawala.

Ku/deep Pablay, Sumit Kacliawha and Dr. Roxana Swamy for the respondents. .

A. Subba Rao for STC .

The Order of the Court was delivered by

. CHINNAPPA REDDY J: We. grant .special leave and procee<l to dispose of the -appeal.

' M/S. Oswal Woollen Mills Limited having its registered office at Ludhiana in the State of Punjab and a branch office-at Calcutta,

and Narayan Das Jain, Secretary of the Company have filed a wtit. /a petition in the Calcutta High Court seeking variom; reliefs against . 1.. _ the Union of India (through the Secretary, Ministry of Commerce, New Delhi), the Chief Controller of Imports and-Exports, New Delhi, the Deputy Chief Controller of Imports and Exports, Amritsar, , 'the Collector of Customs, Calcutta and the. State Trading Corpora- .

J! tion of India, New Delhi. The primary prayer in the writ petition-" is to prevent or to quash an apprebend.ed or purported action under

clause 8-B of the Import Control 'Order. All the other reliefs sought in. the writ petition revolve round the principal_ relief regarding clause- 8-B.of the Import Control Order. The other prayers are eitherancillary or inc.idental to the principal prayer or are of an inter-' locutory charar.tor. Having regard to the fact that the registere<i office of the company is at Ludhiana and the principal respondents. against whom the primary relief is sought are at New Delhi, one would liave expected the writ petition to be filed either in. the Higlh

Court of Punjab and Haryana or in the Delhi High Court. The writ ,';- petitioners however have chosen the Galcutta Hiih Court as theforum perhaps because one of the interlocutory reliefs which is sought is i:n respect of a consignment of beef tallow which has aqived at the ·

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• UNION v .. OSWAL WOOLLEN MILLS (Chinnapa Reddy, J.) 345

Calcutta Port. An inevitable result <;>f the filing of writ petitions A -elsewhere than at the place where the concerned offices and the relevant records are located is to delay pro111pt return and contest.

We do not desire to probe further into the question whether the writ_ petition was filed by design or accident in the Calcutta High Court when the ot)ice f the company is in the State of Punjab and all the B principal respondents are in, Delhi. But we do feel d.isturbed that sue!) writ petitions are often deJibetately filed in .distant High Courts, as part of a manoeuvre"in a legal battle, . so as to render it difficult for the officials at Delhi to move applications to vacate stay where it becomes necessary to file such applications. More about . this later. C

It appears that an order under clause 8.-B of the Import Control Or.derhad been made against the company on Noveber 9, 1983, but the writ petition was filed aif the order was in the offing and might be made at any time, The writ petition was apparently filed in professed or real ignorance of the order made under clause 8-B of D the Import Conirol Order. ..

On November 22, 1983, a learned single judge of the Calcutta' High Court issued a rule Nisi and granted an interim order in the following terms:.

"There will be an interim order of stay/injunction in terms of prayers {j), (.kl, (I) and (ii) of the writ petition till the disposal of the rule.

Liberty is given to the respondents to app1y for vacation or vaiation".

The rule was made returnable on January 31, 1984.

Pl-ayers • (j), (k), (!) and (n) of the petition were !iJr .the grant of:-

"(j)-Injuction restraining the respondents their servants and/or agents from filing any criminal' complaint G against the petitioners or any of its director or employees from initiating any departmental proceedings under the Import and Export (Control) Act, 19-17 and Import (Control) Order, 1955 against the petitioners or.any of its Directors or Employees till the-disposal of the Rule; ·

(k)__:Injuction restraining the respondents from issuing an order of abeyance under clause 8 B oHhe lmport Control

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• 346 . SUP!l.EME C0URT REPORTS [1984] 3 s.c.R.

A Order, 1955 and/or from taking anyaction under such o"rder of abeyance till the disposal of the rule ; ·

(!)--Mandatory ordet directing tbe respondent ,No.5 Coflector of Customs to permit the petitioners t_o .re-export the consignment of inedible Beef Tai low in terms of I.T.G; Public Notice No.37 of 19.83 dated l.9.83 with respect to the consignment weighing 456.316 MT which is.lying at Calcutta under section A9 of the Customs Act; ·

. (n)-An order that pending the hearing and final dis- C posal of this writ petifion the pefitioners be perm1ited to re- Ship and/or re-export the consignment of 456.216 MT of inedible Beef Tallow which arrived at Calcutta as more part\cular:y. menticihcd in Annexure T."

. Ho

It is obvious that the. interim order is of a drastic character with a great potential for mischief.

The principal prayer _in the writ peiition is the <:hallenge to the .. order !'lade or propo.sed to be made under clause 8-B of the Import Control Order. The interim order. in terms of prayers (j) and (k) has the effect (If practically allowing the writ petition at the stage of admis, ion without hearing the oppo- , siie parties.

While we do not wish to .say that a drastic inte-rim order may_never be passed without hearing the opposite parties even_ if the circumstances ju; tify it, we arc very firmly of the opinion that a statutory order sc:ch as the one made iri \he present case unde'r .. ·.

- clause 8-B of the Import Control Order ought not to have been siayed

 without at least hearing tl10se that made the order. Such a stay m;; y lead tq devastating consequences leaving no way of undoing tl\e mischief. Where a plentitude of power is given under.a statute, designed to meet a dire situation, it is nq answer to say that the very nature of the po, ver and the conequences \\'hich may ensue is itself a sufficierit justification for. the grant of a stay of that order, unless, of course, there are stlfficient circun1stances to justify a strong prhna facie inference

that the otaer was made in abuse of the power conferred by _tbe statute.

A statutory order such as the one under clause 8--B purports. to be niade in the public interest and uni em there are even stronger gro.unds of public interest an exp-arte interim order will not be justified.

The only appropriate order to make. in such . cases is to issue notice.to the respondents and make. it returnable within a short period. This should partii; ularly. be so. where the -offices of the principal respondents and relevant records lie outside

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' UNIO'.'l v. OSWAL WOOLLEN.MILLS (Chinnappa Reddy, J.) 347

1he ordinary .jurisdiction bf ihe court. To grant interim relief <11traight away and leave it to the respondents to move the court to vacate the interim order may jeopardise the public interest. It is notorious how if an interim order is once made by a court, partieg . i:mploy every device and tactic to ward off the final hearing of th~

application. It is, therefore, necessary for the courts to be circum- spect in the matter of granting interim relief, more particularly so. where _the .interim relief isodicected against orders or actions.of public -Officials acting in discharge of their public dut)* and in exercise of statu, tcrry powers.

On the facts. and circumstances of the present case, we are satisfied that no interim rnlief should have been granted by the High Court in the terms in w.t.ich it wa, s <lone.

Orders. under .clause 8-B of the Import Control Order, similar to the.one made against Oswal Woollen Mills Limited, were made against various import-export houses and others.

Some of. these -0rders have been questioned by the.affected pa1ties in diffrent High .. Courts and, in some cases, interim orders have also been obtained.

One such writ petition filed by Liberty Oil Mills Pvt. Limited has been. transferred to this court from the Bombay High Court at the instance of the Union of India.

The case is novr pending in this -court and has in fact been heard_ in part by this vary Bench.

Apparently, under the impression that 1ho questions at issue will be finally determined by this court in the c.isc of the Liberty Oil Mills, the Union of lrtdia aml the other autho1 ites do not seem to h_ve

moved expeditiously to contest the writ petiticllls filed in the H''<l!'h Courts and to have the interim orders vacated.

In the present cae. an application to vcate the interim order was filed in the Caicutta

Bigh Com£.on February I, 1984. Jn the mean_;, hile; Oswal Woojien Mills Limited went on writing letters _and sending telegrams compla'. . ining that the interim orders of the High Court had not been opeyed

, and threatening action for contempt of Court.

On January 6, 1984, :ar:i application to commit the Chief Controller of Imp9rts and Exports and others for contempt of court was filed by the company. Notice to the r'espondents was ordered on the same day and on February 3, 1984, overruling .the request made on behalf of the respondents that the petition to vacate the interiin order may be hear<) first, the High Court issued a rule in the appliction for cont- .empt of court againsnhc Ch.ief Controller of Imports & Exports :and the Deputy Chief Controller of Imports and Exports and

irected them to appear in person on March 6, ]984. Thereupon the Union oflndia, the Chief Controller of Imports & Exports, etc.

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SUPRIME COURT REPORTS .

[1984} 3 S.C.R... : ' .

have filed tli.e present special leave petition against the interim ordei-c dated November 22, 191!3. of the Calcutta High Court i~ Civil Ruli:c.

No.10933Wof1983 and the rule for contempt .of court issued on Februrary .3, 1984 inCivil Rnle No. 571 W ofl984. f..We have beard: Shri Milon Banerjee, learned Additional Solicitor General for the.

petitioners and Shri Soli Sorai:Jlee, learned senior Advocate for the respondents. .

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 We have already mentioned. that the High Court \as not right in granting interim relief in the terms in which it had done so.

We~ therefore, vacate the interim order dated November 22, 1983 mad~ by the Calcutta J:ligh Court. It has been pointed oui to us that .th" Chie(Cqntroller oflmports &.Exports has himself issued a Public: . N:otice dated 1st September, 1983 permitting re-shipment/re-export of import consignment which qould not be cleared consequent upon

the Ministry of Commerce Import Trade Control Order No 27/81 dated the 24th August, 1983. The. Public .Notice empowers th" customs authority to allow reshipment/reexp6rt having _regard tO-- the extent to which foreign exchange spent on import will be earned . back and subject to snch other conditions relating .t.hereto as 'the

Customs authority may.impose.· We wish to make.it clear thaUht:o vacating of the interim order. will riot disentitle the writ petitioner!>- . from seeking and taking advantage of the public notice

0dateci Sepiember 1, 1983. • • ,

In regard to the rule for contempt ofcou; t, we find it difficult to sustain thesame. Though ordinarily we would hove.· left the. matter to be decided by.the High Court, we think it unnecessary to . ' - . do so in the present case having regard to the elaborate argument~ addressed to us by bJth parties. The complaint of .the wdt. pe.ti- tioners in seeking the rule for contempt of court was that the authorities had not dealt with. their applications for licences, etc~ .. despite the .'abeyance' order having been stayed. It is obvious that the stay ofthe operation of the 'abeyance' order merely inant that the writ petitioners wereentitled to havetheir applications disposed of by the concerned authorities. The Higi1 Court not having set anylimit of time for the disposal of the applications, it wasnot for the . writ petitioners to impSse a time'.limit and dmmd that their applica-· tions should be disposed of forthwith. If the writ petitioners were aggrieved by the failure of° their authorities to. dispose of their applications expeditiously, it was open to them to seek a further direction from the court to fixing a limit of tim: within. which. the: . . .

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UNION v. OSWAL WOOI, Ll:N MILLS (Chinnappa Reddy, J.) 349:

applications were tobe disposed of. We fail to see how the Chief A.

Controller of Imports & Exports or the Deputy Chief Controller of Imports & Exports could be said to have committed any contempt of court, even priifl.a facie, by their mere failure to take action. in the matter. of the disposal of the applications of the writ petitions.

In the circumstances, we perceive the. application to commit the authorities for contempt of court to be a device to exact licences R from them. ·

We accodingly allow the appeal, vacate the interim order dated November 22, 1983 of the Calcutta High Court in Civil Rule No. 10933 Wof 1983 and quash the rule for contempt bf court issued on February 3, 1984 in Civil Rule No. 571 W of 1984.

Before we part with the 'case , we may refer to a statement made by Shri J.P., Sharma, Deputy Chief Controller of Imports and Ex , ports, New Delhi inth.e affiidavit filed by him before us to the effect that 'in the larger public interest Government was un~ b le to obey the interim order and had taken the question to this Hon'ble C.ourt wl]ich is pending decision shortly'. Torn out of the context in which it was made, the unhappy language in which it has been expressed is suggestive of contumaciousness on the part of J.P. Sharma.

However; he.has_ filed further affidavits before us ewlain, ing the context in which the statement was made and expre5Sing his unqualified regret. We accept his explanation an<! expression. of regret. We are satisfied that Shri J.P. Sharma .did not mean what the language employed by him suggested. However, we. do wish to express our disapproval of the language emplQyed which is certainly suggestive of contumaciousness. • '

N.V.K.

Appeal allowed.