C.M.P.No.15283 of 2019 AS.No.SR85894 of2019 IN THE HIGH COURT OF JUDICATURE AT MADRAS DATED: 11.12.2019 CORAM: THE HONOURABLE MS.JUSTICE S.M.SUBRAMANIAM C.M.P.No.15283 of 2019 in AS.SR.No.85894 of 2019 Pachiyammal .. Appellant Vs. Duraisamy ..Respondent PRAYER: C.M.P.No.15283 of 2019 is filed under Section 5 of the Limitation Act, to condone the delay of 455 days in filing the appeal Suit in AS.SR.No.85894/2019. AS.SR.No.85894/2019 is filed under Section 96 of Civil Procedure Code, against the Judgment and Decree dated 22.11.2017 passed in O.S.No.166 of 2015 on the file of the II Additional District Judge, Puducherry. For Appellant : Mr.Sasindran K. For Respondent : Mr.S.Vadivel 1/34 C.M.P.No.15283 of 2019 AS.No.SR85894 of2019 JUDGMENT Law of Limitation being a substantive law, the Courts are bound to follow the principles, while condoning the delay, which is otherwise enormous. Huge delay cannot be condoned in a routine manner by the Courts. Courts have to exercise the discretionary powers judiciously and cautiously and in the event of exercising the discretionary power to condone the enormous delay, then the reasons must be recorded. In the absence of any acceptable reasons, huge delay cannot be condoned at all. Law of limitation being a substantive law, the rule is to file appeals in time. Condoning the delay by exercising a discretionary power is an exception. Thus, the exception cannot be made as a rule as if the delay in huge can be condoned in a routine manner. This being the basic principles to be adopted by the Courts for the purpose of condoning the huge delay, this Court is of an opinion that the delay of 455 days, which is improperly explained is to be construed as an uncondonable delay. 2. Reasons stated in the present petition for condoning the C.M.P.No.15283 of 2019 AS.No.SR85894 of2019 delay is narrated in paragraphs 4 and 5 of the affidavit filed in support of the miscellaneous petition. In paragraph 4, the petitioner has stated that she enquired about the status of her case and her Advocate used to say that the case is pending and he would call her, as and when required. The very statement is questionable in view of the fact that the petitioner herself participated in the trial and defended her case throughout the trial. Further, it is stated in the affidavit that the petitioner was under the impression that the suit was pending. While so, she came to know that the respondent has filed execution proceedings. In the above case, after receipt of notice in the execution petition, she contacted her advocate and enquired about the issue of letter. She came to know that the suit was decreed on 22.12.2017. Except by blaming the Advocate, in respect of the informations provided by the learned counsel, the petitioner has not furnished any acceptable ground for the purpose of condoning the delay of 455 days in filing the appeal suit. In Paragraph 5 of the affidavit, the petitioner has stated that she was in financial crisis and could not able to mobilize funds for the purpose of paying the Court fee and for filing the appeal suit before the High Court. The insufficient funds cannot be considered as a C.M.P.No.15283 of 2019 AS.No.SR85894 of2019 valid ground for the purpose of condoning a huge delay. Even in such cases, the appeals can be filed in time and within the permissible time limit. The Court fee can be paid or the petitioner, if pauper, then appropriate application can be filed. Contrarily, the reason of insufficient funds cannot be a ground to condone the delay of 455 days in filing the appeal suit. 3. The legal principles to be followed for condoning the delay is well settled and this Court also considered the said principles in C.M.P.Nos.8358 & 8359 of 2018 in AS.SR.No.32087 of 2018 dated 09.12.2019 and the relevant paragraphs are extracted as under: “10. In respect of said contentions, the learned counsel appearing on behalf of the respondent cited the judgment of this Court in the case of Zulaiha Syed Mohideen Vs. D.Visalakshi Ammal & Others reported in MANU/TN/2222/2013, wherein the Court made following observations; “5.Before going into the merits of the case, first of all, it should be stated that in a case of this nature for condonation of delay, it is well settled that length of delay is not material, but the reasons stated thereof for C.M.P.No.15283 of 2019 AS.No.SR85894 of2019 condonation of delay. In other words, for condonation of delay, the reasons adduced must be properly pleaded, convincing and acceptable and explanation should be offered for condonation of the delay. Unless proper explanation is offered, the Courts could not exercise its discretion in the proper perspective to advance substantial justice. It is also settled that when a court has exercised its discretionary power to condone the delay, the appellate Court, in exercise of its discretion, should not ordinarily interfere with such decision unless the discretion exercised is arbitrary and overlooking the interest accrued to another party to the dispute. The appellate Court should also see whether the trial court has taken into consideration all the aspects of the matter, the advantage or disadvantage that may be caused to the other side while condoning the delay inasmuch as during the interregnum, the other party could have asserted a vested right. With this background, let us analyse the merits of the rival contentions urged by the counsel for both sides. 6 to 11....... 12.On behalf of the revision petitioner, several decisions were cited. The learned counsel for the respondents objected for relying on the decisions by stating that they relate to condonation of delay in filing a petition and not with respect to condonation of delay in re- presenting a petition. Such an argument of the counsel for the respondents cannot be countenanced. Each and every C.M.P.No.15283 of 2019 AS.No.SR85894 of2019 case depends on the facts and circumstances of that case. Further, the issue involved in this case is whether the delay in filing a petition has been properly explained and sufficient cause has been shown for the delay or not and in support of the same, the learned counsel for the revision petitioner has relied on the following decisions:- (i) In (Kandaswamy and four others vs. Krishnamandiram Trust, Karur, by its Trustees and 33 others) 2001 (4) CTC 722 this Court took note of the fact that the conduct of the revision petitioner in keeping quite for over two years only on account of inability to mobilise other petitioner evidences would amount to gross negligence, irresponsible inactive attitude and therefore the petitioner lacks bonafides. Under those circumstances, this Court refused to condone the delay of 797 days in filing a petition to set aside the exparte decree. In the above case, this Court also referred to the decision of the Honourable Supreme Court reported in (M.K Prasad vs. P. Arumugam) (2001) 6 Supreme Court Cases 176, which was relied on by the learned counsel for the respondents (ii) In (Sundar Gnanaolivu rep. by his power of attorney agent Mr. Rukmini vs. Rajendran Gnanavolivu, rep. by its power of attorney agent Veina Gnanavalivu) 2003 1 Law Weekly 585, the Division Bench of this Court held that when the averments in the affidavit are untrue, lacks bona fides, then the case falls within the exception to the Rule of Liberal approach and it does not deserve the C.M.P.No.15283 of 2019 AS.No.SR85894 of2019 liberal approach formula in matters relating to condonation of delay. In this case also, the Division Bench of this Court followed the decision of the Honourable Supreme Court reported in (M.K Prasad vs. P. Arumugam) (2001) 6 Supreme Court Cases 176, which was relied on by the learned counsel for the respondents. In Para Nos. 14-A and 15, the Division Bench of this Court held thus:- 14-A. In yet another Division Bench Judgment reported in (1990) 1 LLN 457 (Tamil Nadu Mercantile Bank Limited, Tuticorin versus Appellate Authority under the Tamil Nadu Shops and Establishments Act, Madurai and another) the principles relating to Rule of limitation have been discussed and the legal position has been stated by His Lordship Mr. Justice M. Srinivasan, as he then was, in paragraphs 14 and 17, which read as under:- "14. .....If a litigant chooses to approach the Court long after the time prescribed under the relevant provisions of the law, he cannot say that no prejudice would be caused to the other side by the delay being condoned. The other side would have in all probability destroyed the records thinking that the records would not be relevant as there was no further proceeding in the matter. Hence, to view a matter of condonation of delay, with a presupposition that no prejudice will be caused by the condonation of delay to the respondent in that application will be fallacious. In our view, each has to be decided on C.M.P.No.15283 of 2019 AS.No.SR85894 of2019 the facts and circumstances of the case. Length of the delay is a relevant matter to be taken into account, while considering whether the delay should be condoned or not. It is not open to any litigant to fix his own period of limitation for instituting proceedings for which law has prescribed periods of limitation. "17. .....Once it is held that a party has lost his right to have the matter considered on merits because of his own inaction for a long time, it cannot be presumed to be non-deliberate delay, and in such circumstances of the case, he cannot be heard to plead that substantial justice deserved to be preferred as against technical considerations. WE are of the view that the question of limitation is not merely a technical consideration. Rules of limitation are based on principles of sound public policy and principles of equity. Is a litigant liable to have a Damocles' sword hanging over his head indefinitely for a period to be determined at the whims and fancies of the opponent (underlining is ours) 15. On a conspectus reading of the above principles set out in the various judgments, it is well settled that a liberal approach should be extended while considering the application for condonation of delay. Sufficient caution has been exhibited to note that wherever there is lack of bona fides or attempt of hood-wink the Court by the party concerned who has come forward with an application for condonation of delay, in such cases, no indulgence should C.M.P.No.15283 of 2019 AS.No.SR85894 of2019 be shown by condoning the delay applied for. It is also clear to the effect that it is not the number of days of delays that matters, but the attitude of the party which caused the delay. In other words when the Court finds that the party who failed to approach the Court within the time stipulated comes forward with an explanation for condoning the delay, the Court if satisfied that the delay occasioned not due to the deliberate conduct of the party, but due to any other reason, then by sufficiently compensating the prejudice caused to the other side monetarily, the condonation of delay can be favourably ordered." (iii) In the decision of this Court reported in (G. Jayaraman vs. Devarajan) 2007 (2) CTC 643, this Court held in a case where there was a delay of 553 days in filing an application to set aside the decree that discretion must not be exercised in an arbitrary or vague manner but must be exercised with vigilance and circumspection. It was further held that delay cannot be condoned as a matter of judicial generosity and the right accrued to the other side ought to be kept in view while considering the plea relating to affording opportunity to advance substantial justice. The facts involved in that case is identical to the facts of the case on hand. In that case, the decree holder was prevented from enjoying the fruits of the decree for about 8 years because of the filing of one petition after the other by the defendants to successfully stall the execution of the decree. In that context, this Court held that liberal C.M.P.No.15283 of 2019 AS.No.SR85894 of2019 approach theory would cause prejudice to the plaintiff/decree holder and the discretion exercised by the trial court to condone the delay of 553 days cannot be sustained. In Para Nos. 9, 10 and 16, this Court held as follows:- "9. Of course, it is the consistent view taken by the Supreme Court in various decisions that "sufficient cause" appearing in Section 5 of the Limitation Act should be liberally considered and the Court should be slow in shutting the door of justice to a litigant on the score of limitation. When the reason for the delay is properly explained, the Court is to adopt a pragmatic approach to condone the delay when there is no negligence, inaction or want of bona fide on the part of the Applicant. 10. At the same time, the discretion must be exercised in any arbitrary or vague or fanciful manner, but must be exercised like any other judicial discretion with vigilance and circumspection. Delay cannot be condoned as a matter of judicial generosity. Where delay could have been avoided by due care and caution, the Court may not exercise the discretion to condone the delay. 16. As stated earlier, delay cannot be excused as a matter of judicial generosity. Rendering substantial justice is not to cause prejudice to the opposite party. Money suit was filed way back in 1998 and Revision petitioner/plaintiff has been pursuing the matter for nearly 7 to 8 years. The matter could not reach finality because of one Application C.M.P.No.15283 of 2019 AS.No.SR85894 of2019 or other filed by the respondent/Defendant. The party claiming indulgence must prove that he is reasonably diligent in prosecuting the matter. This test for condoning the delay is not satisfied in this case. Liberal exercise of jurisdiction under Section 5 of the Act would cause prejudice to the plaintiff/Decree holder, who has been pursuing the money suit for quite a long time. In condoning the delay, there is improper exercise of discretion, and therefore, the impugned order cannot be sustained." (iv) In (Shanmugam vs. Chokkalingam) 2009 (5) CTC 48 this Court held that the petitioner therein do not deserve indulgence inasmuch as the averments made by him in the affidavit are false and untrue. Under those circumstances, this Court refused to condone the delay of 332 days in filing a petition to set aside the exparte decree. (v) In (Oriental Aroma Chemical Industries Limited vs. Gujarat Industrial Development Corporation and another) 2010 AIR SCW 1788 the Honourable Supreme Court rejected an application for condonation of delay of 4 years in filing an application to set aside an exparte decree on the ground that the explanation offered for condonation of delay is found to be not satisfied. (vi) In the decision of this Court reported in (K.M. Balasubramaniam vs. C. Loganathan and another) 2011 (2) MWN (Civil) 741 this Court had an occasion to consider a case for condonation of delay of 1581 days in re-presenting an application to set aside the exparte decree. In that case, C.M.P.No.15283 of 2019 AS.No.SR85894 of2019 the suit was filed for recovery of money which was decreed exparte and the Execution Petition filed by the decree holder was also ordered exparte. Thereafter, the decree holder obtained sale certificate also and at the time of taking delivery of the property, the petitioner therein filed the application to condone the delay of 1581 days in setting aside the exparte decree. In that case also, a Petition under Section 47 of the CPC was filed stating that the decree is not executable. In the above facts and circumstances, this Court held that the delay offered for condonation of delay is not proper and acceptable. In Para Nos. 18 and 19, it was held as follows:- 18. It is not in dispute that the suit was filed based on a pro-note dated 01.08.1999 and the ex parte decree was passed on 08.09.2004, nearly 7 years back. It is an admitted fact that the Petitioner appeared in the suit as well as in the earlier E.P. No. 87 of 2005 through Counsel, however, the alleged petition filed under Order 9, Rule 13, C.P.C. to set aside the ex parte decree was not represented for more than four years and four months. Though arrest was ordered in the earlier E.P., however, as the petitioner evaded service, the E.P. was closed, then the present Execution Petition in E.P. No. 292 of 2006 was filed against the property belongs to the petitioner. Notice was served properly on the petitioner/judgment debtor and after proclamation of sale, property was sold in public auction. The successful bidder, a third party to the Suit paid the C.M.P.No.15283 of 2019 AS.No.SR85894 of2019 entire amount. As the sale was confirmed and Sale certificate was also issued, the amount deposited by the auction purchaser was withdrawn by the decree-holder by filing a petition before the Court below and full satisfaction was recorded. At this stage, the petitioner is not entitled to seek an order to condone the inordinate delay of 1581 days in representing an unnumbered Application, seeking an order to set aside the exparte. It cannot be disputed that the length of delay is not a matter for deciding the petition filed under Section 5 of Limitation Act and rendering substantial justice is the paramount consideration. 19. In the instant case, it is clear that the Petitioner/Judgment Debtor has deliberately adopted delay tactics at various stages. Having appeared through Counsel in the earlier Execution Petition in E.P. No. 87 of 2005, evaded arrest and has not challenged various orders passed in the Execution Petitions has casually filed the Application before the court below to condone the delay in representing an Application filed under Order 9, Rule 13, C.P.C. and also filed a Petition under Section 47, C.P.C. which would show that it is an abuse of process of law, as argued by the learned counsel for the Respondents. On the aforesaid circumstances, I could find no merit in favour of the petitioner to allow the inordinate delay of 1581 days in representing an unnumbered Application, seeking an order to set aside the ex parte decree. As found by the Court C.M.P.No.15283 of 2019 AS.No.SR85894 of2019 below, the inordinate delay has not been satisfactorily explained by the Petitioner herein. While deciding the Petition, this Court has to consider the substantial justice. I am of the view that allowing the petition would render only injustice to the Second respondent/auction purchaser, who was impleaded by the order of this Court in this Revision and the first respondent/decree holder, hence, to meed the ends of justice, the Civil Revision Petition is liable to be dismissed, as an abuse of process of law by the Petitioner herein." (vii) In (Postmaster General and others vs. Living Media India Limited and another) (2012) 3 SCC 563, the Honourable Supreme Court, while dismissing the application for condonation of delay of 427 days in filing the Special Leave Petition, held condonation of delay is not an exception and it should not be used as an anticipated benefit for the government departments. In that case, the Honourable Supreme Court held that unless the Department has reasonable and acceptable reason for the delay and there was bonafide effort, there is no need to accept the usual explanation that the file was kept pending for several months/years due to considerable degree of procedural red tape in the process cannot be accepted. In Para Nos. 25, 26, 27, 28, and 29, the Honourable Supreme Court dealt with the scope of 'sufficient cause' and held as follows:- 25. We have already extracted the reasons as C.M.P.No.15283 of 2019 AS.No.SR85894 of2019 mentioned in the "better affidavit" sworn by Mr. Aparajeet Pattanayak, SSRM, Air Mail Sorting Division, New Delhi. It is relevant to note that in the said affidavit, the Department has itself mentioned and is aware of the date of the judgment of the Division Bench of the High Court in Office of the Chief Postmaster vs. Living Media Limited as 11.09.2009. Even according to the deponent, their counsel had applied for the certified copy of the said judgment only on 08.01.2010 and the same was received by the Department on the very same day. There is no explanation for not applying for the certified copy of the impugned judgment on 11.09.2009 or at least within a reasonable time. The fact remains that the certified copy was applied for only on 08.01.2010 i.e., after a period of nearly four months. 26. In spite of affording another opportunity to file better affidavit by placing adequate material, neither the Deponent nor the person-in-charge has filed any explanation for not applying the certified copy within the prescribed period. The other dates mentioned in the affidavit which we have already extracted, clearly show that there was delay at every stage and except mentioning the dates of receipt of the file and the decision taken, there is no explanation as to why such delay had occasioned. Though it was stated by the Department that the delay was due to unavoidable circumstances and genuine difficulties, the fact remains that from day one the Department or the C.M.P.No.15283 of 2019 AS.No.SR85894 of2019 person/persons concerned have not evinced diligence in prosecuting the matter to this Court by taking appropriate steps. 27. It is not in dispute that the person (s) concerned were well aware or conversant with the issues involved including the prescribed period of limitation for taking up the matter by way of filing a special leave petition in this Court. They cannot claim that they have a separate period of limitation when the Department was possessed with competent persons familiar with court proceedings. In the absence of plausible and acceptable explanation, we are posing a question why the delay is to be condoned mechanically merely because the Government or a wing of the Government is a party before us. 28. Though we are conscious of the fact that in a matter of condonation of delay when there was no gross negligence or deliberate inaction or lack of bona fides, a liberal concession has to be adopted to advance substantial justice, we are of the view that in the facts and circumstances, the Department cannot take advantage of various earlier decisions. The claim on account of impersonal machinery and inherited bureaucratic methodology of making several notes cannot be accepted in view of the modern technologies being used and available. The law of limitation undoubtedly binds everybody, including the Government. 29. In our view, it is the right time to inform all the C.M.P.No.15283 of 2019 AS.No.SR85894 of2019 government bodies, their agencies and instrumentalities that unless they have reasonable and acceptable explanation for the delay and there was bona fide effort, there is no need to accept the usual explanation that the file was kept pending for several months/years due to considerable degree of procedural red tape in the process. The government departments are under a special obligation to ensure that they perform their duties with diligence and commitment. Condonation of delay is an exception and should not be used as an anticipated benefit for the government departments. The law shelters everyone under the same light and should not be swirled for the benefit of a few." 11.In the case of Sundar Gnanaolivu Vs. Rajendran Gnanavolivu reported in MANU/TN/2123/2003, the Division Bench made following observations; “8. In the judgment reported in MANU/SC/0573/1998 : 1998 (2) CTC 533 (N. Balakrishnan versus M. Krishnamurthy), the position has been set out as under in para 14: 14. It must be remembered that in every case of delay there can be some lapse 'on the part of the litigant concerned. That alone is not enough to turn down his plea and to shut the door against him. If the explanation does not smack of C.M.P.No.15283 of 2019 AS.No.SR85894 of2019 mala fides or it is put-forth as part of a dilatory strategy the court must show utmost consideration to the suitor. But when there is reasonable ground to think that the delay was occasioned by the party deliberately to gain time then the court should lean against acceptance of the explanation.... (Underlining is ours) 9. In the Judgment reported in MANU/SC/0398/2001 : 2001(6) SCC 176 M.K. Prasad versus P. Arumugam), it has been held as under in para 9. 9.Again in State of W.B. v. Administrator, Howrah Municipality and G. Ramegowda Major v. Special Land Acquisition Officer this Court observed that the expression "sufficient cause" in Section 5 of the Limitation Act must receive a liberal construction so as to advance substantial justice and generally delays be condoned in the interest of justice where gross negligence or deliberate inaction or lack of bona fides is not imputable to the party seeking condonation of delay. Law of limitation has been enacted to serve the interests of justice and not to defeat it. Again in N. Balakrishnan v. M. Krishnamurthy this Court held that acceptability of explanation for the delay is the sole criterion and length of delay is not relevant, in the absence of anything showing mala fide or deliberate delay as a dilatory tactic, the court should normally condone the delay.... (Underlining is ours) C.M.P.No.15283 of 2019 AS.No.SR85894 of2019 10.In a recent Judgment of the Honourable Supreme Court reported in MANU/SC/0135/2002 : 2002(3) SCC 195 = 2002-3-L.W.417 (Ram Nath Sao @ Ram Sahu & Others versus Gobardhan Sap & Others), the position has been succinctly set out in para 12 which reads as under: 12. ...Acceptance of explanation furnished should be the rule and refusal, an exception, more so when no negligence or inaction or want of bona fides can be imputed to the defaulting party. On the other hand, while considering the matter the courts should not lose sight of the fact that by not taking steps within the time prescribed a valuable right has accrued to the other party which should not be lightly defeated by condoning delay in a routine-like manner.... (Underlining is ours) 11. In the Division Bench Judgment of our High Court, in the Judgment reported in MANU/TN/0252/2000 : 2000 (3) CTC 727 = 2000 3 L.W. 938 (C. Subraniam versus Tamil Nadu Housing Board rep. by its Chairman And Managing Director), the position has been stated as under in para 31: 31. To turn up the legal position, (1) the work "sufficient cause" should receive liberal construction to do substantial justice; (2) what is "sufficient cause" is a question of fact in a given circumstances of the case; (3) it is axiomatic that condonation of delay is discretion of the Court; (4) length of delay is no matter, but acceptability of the explanation is the only criterion' (5) once the Court accepts the explanation as "sufficient", it is the result of positive C.M.P.No.15283 of 2019 AS.No.SR85894 of2019 exercise of discretion and normally the superior court should not disturb in such finding unless the discretion was exercised on wholly untenable or perverse; (6) The rules of limitation are not meant to destroy the rights of the parties but they are meant to see that the parties do not resort to dilatory tactics to seek their remedy promptly; (7) Unless a party shows that he/she is put to manifest injustice or hardship, the' discretion exercised by the lower Court is not liable to be revised; (8) If the explanation does not smack of mala fides or it is put forth as part of a dilatory strategy, the court must show utmost consideration to the suitor; (9). If the delay was occasioned by party deliberately to gain time, then the court should lean against acceptance of the explanation and while condoning the delay, the Court should not forget the opposite party altogether. 13. In yet another Division Bench Judgment reported in 1990 (1) LLN 457 (Tamil Nadu Mercantile Bank Ltd. Tuticorin versus Appellate Authority Under The Tamil Nadu Shops And Establishments Act, Madurai And Another), the principles relating to rule of limitation have been discussed and the legal position has been stated by His Lordship Mr. Justice M. Srinivasan, as he then was, in paragraphs 14 and 17 which read as under: 14. ...If a litigant chooses to approach the Court long after the time prescribed under the relevant provisions of the law, he cannot say that no prejudice would be caused to the other side by the delay being condoned. The other side C.M.P.No.15283 of 2019 AS.No.SR85894 of2019 would have in all probability destroyed the records thinking that the records would not be relevant as there was no further proceeding in the matter. Hence to view a matter of condonation of delay with a presupposition that no prejudice will be caused by the condonation of delay to the respondent in that application will be fallacious. In our view, each case has to be decided on the facts and circumstances of the case. Length of the delay is a relevant matter to be taken into account while considering whether the delay should be condoned or not. It is not open to any litigant to fix his own period of limitation for instituting proceedings for which law has prescribed periods of limitation. 17. ...Once it is held that a party has lost his right to have the matter considered on merits because of his own inaction for a long time, it cannot be presumed to be non- deliberate delay, and in such circumstances of the case, he cannot be heard to plead that substantial justice deserved to be preferred as against technical considerations. We are of the view that the question of limitation is not merely a technical consideration. Rules of limitation are based on principles of sound public policy and principles of equity. Is a litigant liable to have a Damocles' sword hanging over his head indefinitely for a period to be determined at the whims and fancies of the opponent? (Underlining is ours) 14. On a conspectus reading of the above principles set out C.M.P.No.15283 of 2019 AS.No.SR85894 of2019 in the various judgments, it is well settled that a liberal approach should be extended while considering the application for condonation of delay. Sufficient caution has been exhibited to note that wherever there is lack of bona fides or attempt to hood-wink the Court by the party concerned who has come forward with an application for condonation of delay, in such cases, no indulgence should be shown by condoning the delay applied for. It is also clear to the effect that it is not the number of days of delay that matters, but the attitude of the party which caused the delay. In other words when the Court finds that the party who failed to approach the Court within the time stipulated comes forward with an explanation for condoning the delay, the Court if satisfied that the delay occasioned not due to the deliberate conduct of the party, but due to any other reason, then by sufficiently compensating the prejudice caused to the other side monetarily, the condonation of delay can be favorably ordered. The Division Bench in the above said case made an observation that a liberal approach should be extended while considering the application for condonation of delay. Sufficient caution has been exhibited to note that wherever there is a lack of bonafides or attempt to hoodwink the Court by the party concerned who has come forward with C.M.P.No.15283 of 2019 AS.No.SR85894 of2019 an application for condonation of delay, in such cases, no indulgence should be shown by condoning the delay applied for. It is observed that question of limitation is not merely a technical consideration but based on principles of sound public policy as well as equity and that a litigant cannot be expected to have Damocles' sword hanging over his had indefinitely for a period to be determined at the whims and fancies of the opponent. 12. Thus, the Courts have taken a clear view that the intention of the parties in filing appeal belatedly after causing prejudice to the interest of the other parties, then also the delay cannot be condoned by exercising the power of discretion. Therefore all these aspects are to be considered. Mechanical or routine approach is impermissible, may be permissible in respect of the delay of short span and not otherwise. 13. In the case of Lanka Venkateswarlu (D) by L.R.s Vs. State of A.P. & others reported in C.M.P.No.15283 of 2019 AS.No.SR85894 of2019 MANU/SC/0153/2011, the Hon’ble Supreme Court made an observation as follows; “20. In the case of M. Balakrishnan (supra), this Court again reiterated the principle that rules of limitation are not meant to destroy the rights of parties. They are meant to see that the parties do not resort to dilatory tactics, but seek their remedy promptly. 21 to 25......... 26.We are at a loss to fathom any logic or rationale, which could have impelled the High Court to condone the delay after holding the same to be unjustifiable. The concepts such as "liberal approach", "justice oriented approach", "substantial justice" can not be employed to jettison the substantial law of limitation. Especially, in cases where the Court concludes that there is no justification for the delay. In our opinion, the approach adopted by the High Court tends to show the absence of judicial balance and restraint, which a Judge is required to maintain whilst adjudicating any lis between the parties. We are rather pained to notice that in this case, not being satisfied with the use of mere intemperate language, the High Court resorted to blatant sarcasms. The use of unduly strong intemperate or extravagant language in a judgment has been repeatedly disapproved by this Court in a number of cases. Whilst considering applications for condonation of delay under Section 5 of the C.M.P.No.15283 of 2019 AS.No.SR85894 of2019 Limitation Act, the Courts do not enjoy unlimited and unbridled discretionary powers. All discretionary powers, especially judicial powers, have to be exercised within reasonable bounds, known to the law. The discretion has to be exercised in a systematic manner informed by reason. Whims or fancies; prejudices or predilections can not and should not form the basis of exercising discretionary powers." 14. In the case of Pundlik Jalam Patil (D) by Lrs. Vs. Exe.Eng.Jalgaon Medium Project & others reported in MANU/SC/4694/2004, the Hon’ble Supreme Court held as follows: “15. In Ajit Singh Thakur Singh and anr. vs. State of Gujarat [ (1981) 1 SCC 495 ] this court observed : "It is true that a party is entitled to wait until the last day of limitation for filing an appeal. But when it allows limitation to expire and pleads sufficient cause for not filing the appeal earlier, the sufficient cause must establish that because of some event or circumstance arising before limitation expired it was not possible to file the appeal within time. No event or circumstance arising after the expiry of limitation can constitute sufficient cause." (Emphasis supplied) This judgment squarely applies to the facts in hand. C.M.P.No.15283 of 2019 AS.No.SR85894 of2019 17. Shri Mohta, learned senior counsel relying on the decision of this court in N. Balakrishnan vs. M.Krishnamurthy [(1998) 7 SCC 123] submitted that length of delay is no matter, acceptability of explanation is the only criterion. It was submitted that if the explanation offered does not smack of mala fides or it is not put forth as part of dilatory tactics the court must show utmost consideration to the suitor. The very said decision upon which reliance has been placed holds that the law of limitation fixes a life span for every legal remedy for the redress of the legal injury suffered. Unending period for launching the remedy may lead to unending uncertainty and consequential anarchy. The law of Limitation is thus founded on public policy. The decision does not lay down that a lethargic litigant can leisurely choose his own time in preferring appeal or application as the case may be. On the other hand, in the said judgment it is said that court should not forget the opposite party altogether. It is observed: "It is enshrined in the maxim interest reipublicae up sit finis litium ( it is for the general welfare that a period be put to litigation). Rules of limitation are not meant to destroy the rights of the parties. They are meant to see that parties do not resort to dilatory tactics but seek their remedy promptly. The idea is that every legal remedy must be kept alive for a legislatively fixed period of time." 18. In Ramlal and others vs. Rewa Coalfields Ltd. C.M.P.No.15283 of 2019 AS.No.SR85894 of2019 [ AIR 1962 SC 361], this court held that: "in construing Section 5 of the Limitation Act, it is relevant to bear in mind two important considerations. The first consideration is that the expiration of period of limitation prescribed for making an appeal gives rise to right in favour of the decree holder to treat the decree as binding between the parties and this legal right which has accrued to the decree holder by lapse of time should not be light heartedly disturbed. The other consideration which cannot be ignored is that if sufficient cause of excusing delay is shown discretion is given to the court to condone the delay and admit the appeal. `It is further necessary to emphasis that even if the sufficient cause has been shown a party is not entitled to the condonation of delay in question as a matter of right. The proof of a sufficient cause is a condition precedent for the exercise of the discretionary jurisdiction vested in the court by section 5. This aspect of the matter naturally introduces the consideration of all relevant facts and it is at this stage the diligence of the party of its bona fides may fall for consideration." On the facts and in the circumstances, we are of the opinion that the respondent beneficiary was not diligent in availing the remedy of appeal. The averments made in the application seeking condonation of delay in filing appeals do not show any acceptable cause much less sufficient cause to exercise courts' discretion in its favour." C.M.P.No.15283 of 2019 AS.No.SR85894 of2019 15. In the case of Esha Bhattacharjee Vs. Managing Committee of Raghunathpur Nafar Academy & Others reported in MANU/SC/0932/2013, the Hon’ble Apex Court of India made an observation as follows: “15. From the aforesaid authorities the principles that can broadly be culled out are: i) There should be a liberal, pragmatic, justice-oriented, non- pedantic approach while dealing with an application for condonation of delay, for the courts are not supposed to legalise injustice but are obliged to remove injustice. ii) The terms sufficient cause should be understood in their proper spirit, philosophy and purpose regard being had to the fact that these terms are basically elastic and are to be applied in proper perspective to the obtaining fact- situation. iii) Substantial justice being paramount and pivotal the technical considerations should not be given undue and uncalled for emphasis. iv) No presumption can be attached to deliberate causation of delay but, gross negligence on the part of the counsel or litigant is to be taken note of. v) Lack of bona fides imputable to a party seeking condonation of delay is a significant and relevant fact. vi) It is to be kept in mind that adherence to strict proof should not affect public justice and cause public mischief C.M.P.No.15283 of 2019 AS.No.SR85894 of2019 because the courts are required to be vigilant so that in the ultimate eventuate there is no real failure of justice. vii) The concept of liberal approach has to encapsule the conception of reasonableness and it cannot be allowed a totally unfettered free play. viii) There is a distinction between inordinate delay and a delay of short duration or few days, for to the former doctrine of prejudice is attracted whereas to the latter it may not be attracted. That apart, the first one warrants strict approach whereas the second calls for a liberal delineation. ix) The conduct, behaviour and attitude of a party relating to its inaction or negligence are relevant factors to be taken into consideration. It is so as the fundamental principle is that the courts are required to weigh the scale of balance of justice in respect of both parties and the said principle cannot be given a total go by in the name of liberal approach. x) If the explanation offered is concocted or the grounds urged in the application are fanciful, the courts should be vigilant not to expose the other side unnecessarily to face such a litigation. xi) It is to be borne in mind that no one gets away with fraud, misrepresentation or interpolation by taking recourse to the technicalities of law of limitation. xii) The entire gamut of facts are to be carefully scrutinized and the approach should be based on the paradigm of C.M.P.No.15283 of 2019 AS.No.SR85894 of2019 judicial discretion which is founded on objective reasoning and not on individual perception. xiii) The State or a public body or an entity representing a collective cause should be given some acceptable latitude. 16. To the aforesaid principles we may add some more guidelines taking note of the present day scenario. They are: - a) An application for condonation of delay should be drafted with careful concern and not in a half hazard manner harbouring the notion that the courts are required to condone delay on the bedrock of the principle that adjudication of a lis on merits is seminal to justice dispensation system. b) An application for condonation of delay should not be dealt with in a routine manner on the base of individual philosophy which is basically subjective. c) Though no precise formula can be laid down regard being had to the concept of judicial discretion, yet a conscious effort for achieving consistency and collegiality of the adjudicatory system should be made as that is the ultimate institutional motto. d) The increasing tendency to perceive delay as a non- serious matter and, hence, lackadaisical propensity can be exhibited in a non-challant manner requires to be curbed, of course, within legal parameters." It is very important to consider the judgement of the C.M.P.No.15283 of 2019 AS.No.SR85894 of2019 Hon’ble Supreme Court in the case of Esha Bhattacharjee, wherein the Hon'ble Apex Court laid down certain principles which were culled out particularly and those principles are the guiding principles for the purpose of deciding the petitions filed to condone the delay. The above principles, cited supra reveals that the concept of liberal approach has to encapsule the conception of reasonableness and it cannot be allowed totally to unfettered free play. 16. The concepts such as “liberal approach”, “justice oriented approach”, “substantial justice” cannot be employed in jettison the substantial law of limitation. The law of limitation is substantial and therefore the principles laid down is to be scrupulously followed while condoning the delay under the law of limitation. The limitation has got a specific purpose and object and more specifically to avoid prejudice to the respective parties. In the event of prolongation or protraction of the litigation, undoubtedly and for an unspecified period when the specific law of limitation has got a specific purpose and object, then the C.M.P.No.15283 of 2019 AS.No.SR85894 of2019 power of discretion is to be exercised cautiously. Power of discretion cannot be exercised in the absence of any valid reason. In other words, powers can be exercised for the purpose of passing orders only by recording reasons which must be candid and convincing and must be passed on certain sound legal principles. Therefore, recording of reasons for exercising discretionary powers is one of the elementary principles of law. In the event of exercising discretionary powers without recording reasons, undoubtedly the same would cause not only prejudice and will set a bad principle and therefore, the Courts must be cautious while exercising power of discretion more specifically in such matters where the law of Limitation is substantial.” 5. In view of the legal principles and the facts and circumstances in the present case on hand, this Court is of an opinion that the petitioner has not made out any acceptable ground for the purpose of condoning the delay. C.M.P.No.15283 of 2019 AS.No.SR85894 of2019 6. Consequently, the Civil Miscellaneous Petition in C.M.P.No.15283 of 2019 is devoid of merits and the same stands dismissed. Accordingly, AS.SR.No.85894 of 2019 is rejected at the SR Stage itself. No costs. 11.12.2019 Kak Index:Yes Speaking order C.M.P.No.15283 of 2019 AS.No.SR85894 of2019 S.M.SUBRAMANIAM, J. Kak To The II Additional District Judge, Puducherry. C.M.P.No.15283 of 2019 in AS.SR.No.85894 of 2019 11.12.2019


PETITIONER: GANESH DASS SREERAM, ETC. A Vs. RESPONDENT: INCOME TAX OFFICER, 'A' WARD, SHILLONG AND OTHERS ETC. DATE OF JUDGMENT30/10/1987 BENCH: DUTT, M.M. (J) BENCH: DUTT, M.M. (J) PATHAK, R.S. (CJ) MISRA RANGNATH CITATION: 1988 AIR 427 1988 SCR (1) 689 1987 SCC Supl. 442 JT 1987 (4) 208 1987 SCALE (2)894 ACT: Income Tax Act, 1961-Interest charged by Income Tax officer for delayed filing of returns-Legality of-Sub- section (4) of section 139 of the Act, as it stood before April l, 1971-Constitutional validity of. c HEADNOTE: % The appellants, registered firms under the Income Tax Act, 1961, filed delayed returns. The Income Tax officer assessed the appellants under section 143(3) of the Act and determined the total incomes of the appellants and the amounts of the tax payable by them. The Income Tax officer also determined and added, under sub-section (4) of section 139 of the Act, the amounts of interest on the amounts of tax payable by the appellants. The appellants challenged the charging of interest in the High Court by writ petitions. The High Court dismissed all but some writ petitions which were allowed in part to the extent that the Income tax officer was directed to take into account the advance tax paid by the assessees while calculating the interest. The appellants have filed Civil Appeals Nos. 1032-1036 of 1973, 1927-1933 of 1978 and 1288 and 1289 of 1980 against the decision of the High Court. Allowing Civil Appeal No. 1035 of 1973 and dismissing all the other appeals, the Court, ^ HELD: Sub-section (4) of section 139 of the Income Tax Act is a substantive provision, which does not provide for the making of an application to the Income Tax officer for extention of the date for furnishing return. The sub-section provides that even though a person does not furnish the return within the time allowed under sub-section (1) or (2) of section 139, yet he may furnish the same before the end of four assessment years concerned. The substantive provisions of subsections (1) and (2) specify the time within which the return has to be filed. The provisos to the sub-sections confer power on the Income-tax officer to extend the date for filing the return on an application. The expression "time allowed" in sub-section (4) is not confined only to the extension of time granted by the Income-tax officer but also to the time originally fixed for 690 filing the returns under sub-section(1) and (2). [694G- H;695A-D] The Income-Tax officer is entitled to charge interest in accordance with the provisions of clause (iii) of the proviso to sub-section (1) of section 139 in a case where time has been extended by the Income Tax officer to file returns on application made by the assessee and the return is not filed within the time allowed, and in a case where no such application has been made by the assessee, and the return is filed beyond the time allowed but before the end of the four assessment years concerned. [695D-F] Secondly, as decided by this Court in Central Provinces Manganese Ore Co. Ltd. v. Commissioner of Income-Tax, [1986] 160 ITR 961, and Commissioner of Income Tax A.P. v. Chandra Sekhar, (1955) 151 ITR 433, the interest is levied by way of compensation, and not by way of penalty as contended by the appellants. [696A] The contention of the appellants that the provisions of Sub-Section (4) of section 139, read with clause (iii) (a) of the proviso to Sub-Section (1) of section 139 is discriminatory and violative of Article 14 of the Constitution because Sub-Section (4) has placed the registered firms in a separate category inasmuch as they have to pay interest calculated on the amount of tax payable by them as unregistered firms, and a registered firm is treated as an unregistered firm, for purposes of qualification of interest, is not comprehensible, Section 139 (4) read with clause (iii)(a) of the proviso to section 139(1), as it stood prior to April 1, 1971, has placed the registered firms and the unregistered firms on the same footing and is not violative of Article 14 of the Constitution and is quite legal and valid. [697H; 698A-D] Where advance tax duly covers the entire amount of the tax assessed, there is no question of charging a registered firm with interest if the return is filed beyond the time allowed, regard being given to the fact that payment of interest is only compensatory in nature. As the entire amount of the tax is paid by way of advance tax, the question of payment of any compensation does not arise, and accordingly, in the facts and circumstances of the case in the C.A. No. 1035 of 1973, the Income Tax of officer was not justifed in charging interest, and the assessee in that case is entitled to refund of the amount paid by way of interest. [699B-C, E] Commissioner of Income- Tax, A . P. v. M. Chandra Sekhar, [1955] 151 ITR 433, Central Provinces Manganese ore Co. Ltd. v. Commissioner of Income Tax, [1986] 160 I.T.R. 961; Jain Brothers 691 and others v. Union of India and others, [1970] 77 ITR 109; M. Nagappa v. Income Tax officer, Central Circle I, Bangalore, [1975] 99 ITR 33; Mahendra Kumar Ishwarlal and Co. v, Union of India, [1973] 91 ITR 101 and [1974] 94 ITR 65; Chhotalal & Co. v. Income-Tax officer; [1976] 105 ITR 230; Jiwanmal Hospital v. Income-Tax officer, [1979] 119 ITR 439; Hindustan Steel Forges v. Commissioner of Income-Tax, [1980] 121 ITR 793 and Mohanlal Soni v. Union of India, [1983] 143 ITR 436, referred to. JUDGMENT: CIVIL APPELLATE JURISDICTION: Civil Appeal Nos 1032- 1036 of 1973. From the Judgment and order dated 16.2.1973 of the Gauhati High Court in Civil Rule Nos. 1142 to 1146 of 1971 S.T. Desai, R.P Agarwala, Mrs Kum Kum Sen, Praveen Kumar, D.N. Mukherjee, Ranjan Mukherjee and N.R. Choudhary for the Appellants. Dr. V. Gauri Shanker and Miss A. Subhashini for the Respondents. The Judgment of the Court was delivered by DUIT, J.The appellants, who are all registered firms within the meaning of section 2(39) of the Income-Tax Act, 1961, hereinafter referred to as 'the Act', have preferred these appeals against the judgments of the Gauhati High Court overruling the challenge of the appellants as to the legality of the interest charged by the Income-tax officer for the delayed filing of returns and also as to the constitutional validity of sub-section (4) of section 139 of the Act, as it stood before April 1, 197 l The relevant provisions of section 139, as it stood prior to April 1. 1971, are as follows:- "S. 139(1). Every person, if his total income .. ...... during the previous year exceeded the maximum amount which is not chargeable to Income- tax, shall furnish a return of his income ................. (a) in the case of every person .. .. before the expiry of six months from the end of the previous year ... , or before the 30th day of June of the assessment year, whichever is later; (b) in the case of every other person, before the 30th day of June of the assessment year: Provided that, on an application made in the pre scribed manner, the Income-tax officer may, in his discretion, extend the date for furnishing the return- (i) in the case of any person whose total income includes any income from business or profession the previous year in respect of which expired on or before the 31st day of December of the year immediately preceding the assessment year, and in the case of any person referred to in clause (b), up to a period not extending beyond the 30th day of September of the assessment year without charging any interest; (ii) in the case of any person whose total income includes any income from business or profession the previous year in respect of which expired after the 31st day of December of the year immediately preceding the assessment year, up to the 31st day of December of the assessment year without charging any interest; and (iii)up to any period falling beyond the dates mentioned in clauses (i) and (ii), in which case, interest at nine per cent per annum shall be pay able from the 1st day of October or the 1st day of January, as the case may be, of the assessment year to the date of the furnishing of the return- (a) in the case of a registered firm or an unregistered firm which has been assessed under clause (b) of section 183, on the amount of tax which would have been payable if the firm had been assessed as an unregistered firm and (b) in any other case, on the amount of tax payable on the total income. reduced by the advance tax, if any, paid or by any tax deducted at source, as the case may be. (2). In the case of any person, who in the Income-tax officer's opinion, is assessable under this Act, whether on his own total income or on the total income of any other person during the previous year, the Income-tax officer may, before the end of the relevant assessment year, serve a notice upon him requiring him to furnish, within thirty days from the date of service of the notice, a return of his income or the income of such other person during the previous year, in the prescribed form and verified in the prescribed manner setting forthwith such other particulars as may be prescribed; Provided that on an application in the prescribed manner the Income-tax officer may, in his discretion, extend the date for the furnishing of the return, and when the date for furnishing the return, whether fixed originally or on extension, falls beyond the 30th day of September or, as the case may be, the 31st day of December of the assessment year, the provisions of sub- clause (iii) of the proviso to sub-section ( 1) shall apply. (4). Any person who has not furnished a return within the time allowed to him under sub- section (1) or sub-section (2) may before the assessment is made furnish the return for any previous year at any time before the end of four assessment years from the end of the assessment year to which the return relates, and the provisions of sub-clause (iii) of the proviso to sub-section (1) shall apply in every such case." In all these cases, it is not disputed that no application for extension of time to file returns was made by the appellants for the relevant assessment years. The returns were submitted before the assessment was made and also before the end of the four assessment years as mentioned in sub-section (4) of section 139 of the Act. The Income-tax officer assessed the appellants under section 143(3) of the Act and determined the total incomes of the appellants and the amounts of tax payable by them. In view of sub-section (4) of section 139, the Income tax officer also added to the amount of tax interest calculated at the rate of six per cent per annum on the amount of tax which would have H been payable if the firms had been assessed as unregistered firms. A Being aggrieved by the charging of interest under sub-section (4) read with clause (iii)(a) of the proviso to sub-section ( I) of section 139 of the Act, the appellants filed writ petitions before the Gauhati High Court, challenging the charging of interest and the validity of subsection (4) read with clause (iii)(a) of the proviso to sub-section ( 1) of section 139 of the Act as violative of Article 14 of the Constitution The Gauhati High Court, as stated already, overruled the challenge and dismissed the writ petitions except that some writ petitions were allowed in part only as the High Court directed the Income-tax officers to take into account the advance tax paid by the assessees before calculating the interest. Hence these appeals. The first contention made on behalf of the appellants is that it is clear from the provisos to sub-sections ( 1) and (2) of section 139 of the Act that unless an application is made for extension of the date for furnishing the return, the question of charging any interest on the amount of tax does not at all arise. A similar contention was made before the High Court by the appellants, but the High Court overruled the same. Much reliance has been placed on behalf of the appellants on an observation of this Court in Commissioner of Income-tax, A.P. v. M. Chandra Sekhar, [1955] 151 ITR 433. In that case, this Court has observed that it is only where the Income-tax officer extends the time for furnishing the return beyond September 30, or December 31, as the case may be, the interest becomes payable The said observation has been made by this Court relating to clause (iii) of the proviso to sub-section ( 1) of section 139 of the Act while considering the question whether charging of interest indicated that the Income-tax officer was satisfied that there was sufficient cause for the delay in filing the return of income and whether the cancellation of the penalties levied under section 27(1)(a) of the Act was justified. Nothing has, however, been said by this Court in respect of sub-section (4) of section 139 of the Act. Sub-section (4) is a substantive provision and it does not provide for making an application to the Income-tax officer for the purpose of extension of the date for the furnishing of the return. What is provided in sub-section (4) is that even though a person does not furnish the return within the time allowed to him under sub-section (I) or subsection (2), yet he may furnish the same before the end of the four assessment years concerned. The substantive provision of sub-sections (l) and (2) of section 139 specify the time within which the return has to be filed The provisos to sub-sections (1) and (2) confer power on the Income-tax officer to extend the date for filing the return on an application in that regard made by the assessee. So, it is clear that the expression 'time allowed' in sub-section (4) of section 139 is not confined only to the extension of time granted by the Income-tax officer, but also to the time originally fixed for the filing of returns under sub-sections ( 1) and (2) of section 139 of the Act. There may be two types of cases for the late filing of returns, namely ( 1) the assessee after getting the date extended by the Income tax officer under sub-section ( 1) or sub-section (2) of section 139 of the Act, does not file the return within the extended date, but files the same before the end of four assessment years concerned and (2) the assessee without filing any application for extension of time, files the return beyond the period mentioned in sub- section ( 1) or sub-section (2) but before the end of four assessment years in question. In either case, the provision of clause (iii) of the proviso to sub-section (l) of section 139 will apply. In other words, the Income-tax officer will be entitled to charge interest on the amount of tax in accordance with the provision of clause (iii) of the proviso to sub-section ( 1) of section 139. Thus, where time has been extended by the Income-tax officer on an application made in that regard by the assessee and the assessee does not file the return within the time allowed and where no such application has been made by the assessee, but the return is filed by him beyond the time allowed, but before the end of the four assessment years concerned, in either case, the Income-tax officer will be entitled to charge interest in accordance with the provision of clause (iii) of the proviso to sub-section (1) of section 139 of the Act. There is, therefore, no substance in the contention of the appellants that as the appellants had not made any application praying for the extension of time for the filing of returns, the Income-tax officer had no authority to charge interest under the provision of clause (iii) of the proviso to sub-section ( I) of section 139 of the Act The next question that requires consideration relates to the validity of sub-section (4) read with clause (iii)(a) of the proviso to subsection (I) of section 139. It is submitted by the learned Counsel appearing on behalf of the appellants that as, in view of the late filing of the returns, there is postponement of the payment of tax and the Revenue suffers loss on account of delayed payment of tax, the interest when levied takes the character of penalty This contention need not detain us long, for it has already been decided by this Court in Central Provinces Manganese ore Co. Ltd.. v. Commissioner of Income-tax, [ 1986] 160 ITR 1961 that interest is levied by way of compensation and not by way of penalty. In Chandra Sekhar's case (supra? this Court also has taken a similar view. The High Court, however, has taken the view that the interest charged partakes also of a penal character. In expressing that view, the High Court has placed reliance upon a decision of this Court in Jain Brothers and others v. Union of India and others, [ 1970] 77 ITR 109. In that case, this Court was mainly considering a challenge to section 271(2) of the Act, which is a penal provision, on the ground of contravention of Article 14 of the Constitution. The question whether charging of interest under the proviso to section 139(1) of the Act was in the nature of penalty or not, was not considered by this Court. Indeed, the subject-matter was different from that with which we are concerned. In view of the decisions of this Court in Chandra Sekhar's case (supra) and in the case of Central Provinces Manganese ore Co. Ltd. (supra), we hold that the charging of interest did not become transformed to penalty. It is urged on behalf of the appellants that all the assessees who are charged with interest for the late filing of returns, should be classified in one and the same category inasmuch as they are similarly situated, but sub- section (4) read with clause (iii) of the proviso to sub- section ( I) of section 139 of the Act has without any reasonable justification placed the registered firms in a separate category inasmuch as for the late filing of returns by such firms they are-saddled with interest to be calculated on the amount of tax payable by them as unregistered firms. It is submitted that such separate classification of the registered firms for the purpose of payment of interest under section 139, does not bear any nexus to the object sought to be achieved by the section and, accordingly, the provision of sub-section (4) read with clause (iii)(a) of the proviso to sub-section (1) of section 139 of the Act is discriminatory and violative of the provision of Article 14 of the Constitution and, as such, is void. In support of the contention, the appellants have placed much reliance upon a decision of the Karnataka High Court in M. Nagappa v. Income-tax officer, Central Circle 1, Bangalore, [ 1975] 99 ITR 33. In that case, a learned Single Judge of the Karnataka High Court has struck down as void the provision of sub-section (4) read with clause (iii)(a) of the proviso to sub-section ( 1) of section 139 The reason that weighed with the learned Judge is that the loss suffered by the Government which is sought to be compensated by the legislative measure should be the same in all cases, irrespective of the fact that the assessee who is responsible for it is a registered firm or. any other kind of assessee. If that is the case, then the amount claimed by way of interest should be directly correlated to the amount of tax withheld by the assessee without reference to the kind of assessee concerned in a given case. It is observed that the object of levy of interest being just reimbursement of what the Government would lose by delayed payment of tax resulting from the delayed filing of the return, it is clear that the levy of interest in the case of a registered firm on the tax which would have been payable if the firm had been assessed as an unregistered firm, is outside the said object. Accordingly, it has been held that section 139(4) to the extent it required a registered firm to pay interest at the specified rate on the tax assessed as if it were an unregistered firm, whenever the registered firm did not file the return within the specified time, was violative of Article 14 of the Constitution and is, therefore, void. That decision of the learned Single Judge has been upheld by a Division Bench of the Karnataka High Court and is since reported in [ 1981] 129 ITR 516. The Karnataka High- Court, before holding that provision of sub-section (4) of section 139 read with clause (iii)(a) of the proviso to sub-section ( 1) of section 139 of the Act as violative of Article 14 of the Constitution, has not considered the reason why, when a registered firm submits a return beyond time, it is charged with interest calculated on the amount of tax which would have been payable if the firm had been assessed as an unregistered firm. It is because of certain privileges which have been conferred on a registered firm. One of the privileges is that the firm is considered as an assessable unit and is taxed at a reduced rate and the partners are assessed on their respective shares in the income of the firm. This privilege which has been conferred on a registered firm by the Act, is not available to an unregistered firm. The Legislature is, however, competent to withhold any of the privileges conferred on a registered firm if it violates any of the provisions of the Act. A registered firm is required to file its return within the time as prescribed by the Act. Clause (iii)(a) of the proviso to section 139(1) read with sub-section (4) of section 139 in effect only provides for the withdrawal of the privilege of the registered firm to be assessed at a reduced rate because of its non-compliance with the provisions of sub-sections (1) and (2) of section 139 of the Act. In other words, the registered firm is treated as an unregistered firm for purposes of quantification of interest. The contention of the appellants that by treating the registered firms as unregistered firms for the charging of interest, the Legislature has placed the registered firms in a separate category is not at all comprehensible. On the other hand, by treating the registered firms as unregistered firms, the Legislature has avoided the discrimination that would have been there if the registered firms were not so treated for the purpose of charging of interest. In other words, if the registered firms had been charged with interest on the amount of tax assessed at a reduced rate for the late filing of the returns, there would have been discrimination between registered firm and unregistered firms. When a registered firm and an unregistered firm commit the same default in filing returns beyond the time allowed under sub-sections ( 1) and (2) of section 139 of the Act, it would be unreasonable and unjust to charge two different rates of interest-one at a reduced rate for the registered firm and the other at a higher rate for the unregistered firm. So, in our opinion, section 139(4) read with clause (iii)(a) to the proviso of section 139(1) of the Act, as it stood prior to April 1, 1971, has placed the registered firms and the unregistered firms on the same footing as, for the purpose of interest, they are similarly situated. Dr. Gouri Shankar, learned Counsel appearing for the Revenue, has pointed out to us that except the Karnataka High Court, other High Courts, namely, Madras High Court, Gujarat High Court, Madhya Pradesh High Court, Punjab & Haryana High Court and the Calcutta High Court in Mahendrakumar Ishwarlal & Co. v. Union of India, [1973] 91 ITR 101, since affirmed on an appeal reported in [1974] 94 ITR 65; Chhotalal & Co. v. Income-tax officer, [1976] 105 ITR 230; Jiwanmal Hospital v. Income-tax officer, [1979] 119 ITR 439; Hindustan Steel Forges v. Commissioner of Income- tax, [ 1980] 121 ITR 793 and Mohanlal Soni v. Union of India, [ 1983] 143 ITR 436 respectively have taken the view that treating of registered firms as unregistered firms for the purpose of charging of interest for the late filing of returns cannot be said to be arbitrary and violative of Article 14 of the Constitution. The view expressed in these decisions, in our opinion, is correct. As has been noticed already, the Karnataka High Court did not consider the question of withholding of the privileges conferred on the registered firm on their default in filing returns within the time allowed under sub-sections (1) and (2) of section 139 of the Act, so that they may be treated on equal footing with unregistered firms making the same default. In the circumstances, no discrimination has been made between a registered firm and an unregistered firm and, accordingly, the provision of sub-section (4) of section 139 read with clause (iii)(a) of the proviso to sub-section (1) of section 139 of the Act is not violative of Article 14 of the Constitution and is quite legal and valid. The decision of the Karnataka High Court in Nagappa's case (supra), as affirmed on appeal by the Division Bench of that High Court, in so far as it declares the said provision as ultra vires Article 14 of the Constitution, is erroneous. Before we part with these appeals, we think we should clarify one situation, namely, where the advance tax duly paid covers the entire amount of tax assessed, there is no question of charging the registered firm with interest even though the return is filed by it beyond the time allowed, regard being had to the fact that payment of interest is only compensatory in nature. As the entire amount of tax is paid by way of advance tax, the question of payment of any compensation does not arise. In C.A. No. 1035 of 1973, it appears that total tax for the assessment year 1968-69 was assessed at RS.. 16,288. The assessee paid advance tax amounting to Rs.39,018 in three instalments on 25.9.1967, 24.1.1968 and 2.3.1968. It is apparent that the amount of advance tax paid by the assessee fully covered the amount of tax payable by it. In spite of that, the Income-tax officer charged the assessee for the said assessment year a sum of Rs. 14,233 as interest under section 139 of the Act for the delayed filing of the return. As has been observed earlier, when the amount of tax and already been paid in the shape of advance tax, the question of payment of compensation by way of interest does not arise and the Income-tax officer was not, therefore, justified in charging interest. The assessee is, therefore, entitled to get refund of the amount paid by way of interest for the said assessment year. The Income-tax officer is directed to refund to the assessee the amount paid on account of interest. In the result, C.A. No. 1035 of 1973 is allowed and the remaining appeals are dismissed. There will, however, be no order as to costs in any of these appeals. S.L. Appeal No. 1035/73 allowed and others dismissed.


PETITIONER: KULDEEP SINGH Vs. RESPONDENT: THE COMMISSIONER OF POLICE & ORS. DATE OF JUDGMENT: 17/12/1998 BENCH: S.SAGHIR AHMAD, & S.P. KURDUKAR., JUDGMENT: -------- S.SAGHIR AHMAD -------------- Leave granted. The appellant, a constable in the Delhi Police was dismissed, after a regular departmental enquiry, from service, by order dated 03.05.1991, passed by Dy Commissioner of Police, South District, New Delhi, which was upheld in appeal by Addl. Commissioner of Police by his order dated 22.07.1991. The appellant then approached the Central Administrative Tribunal, Principal Bench, New Delhi and the Tribunal, by the impugned judgment dated 28th February, 1997, dismissed the Claim Petition. A writ Petition filed before the Delhi High Court against this judgment was dismissed on 19.09.1997 as not maintainable as the judgment passed by the Tribunal was given before the date on which the decision of this Court was rendered in L.Chandra Kumar Vs. Union of India & Others, AIR 1997 SC 1125 = (1997) 3 SCC 261, in which it was held that a writ petition against the order passed by the Tribunal, constituted under the Administrative Tribunal, Act, 1985, would be maintainable (prospectively) before a High Court. The Review Application filed against the judgment of the Tribunal was dismissed on 26.05.1997. Learned counsel for the appellant has contended that the findings recorded by the Enquiry Officer cannot be sustained as the enquiry itself was held in utter violation of the principles of natural justice. It is also contended that there was no evidence worth the name to sustain the charge framed against the appellant and therefore, the findings are perverse particularly as no reasonable person could have come to these findings on the basis of the evidence brought on record. Learned counsel appearing on behalf of Union of India has, on the other hand, contended that the enquiry was held in consonance with the principles of natural justice and during the course of the enquiry, full opportunity was given to the appellant to defend himself. As far the evidence is concerned, it is contended that though it is true that none of the complainant was examined but on account of Rule 16(3) of the Delhi Police (F&A) Rules, 1980, it was not required to produce the complainant in person as the Rule itself contemplated that in the absence of a witness whose presence could not be procured without undue delay, inconvenience or expense, his statement, already made on an earlier occasion, could be placed on record in the departmental enquiry and the matter could be decided on that basis. It was under this Rule that the previous joint statement of the complainants was brought on record without examining any of them. Learned counsel for the respondents contended that the scope of judicial review in disciplinary proceedings is extremely narrow and limited. The court cannot, it is contended, re-examine or re-appraise the evidence and substitute its own conclusion in place of the conclusions arrived at by the Enquiry Officer or the disciplinary authority on that evidence. It is no doubt true that the High Court under Article 226 or this Court under Article 32 would not interfere with the findings recorded at the departmental enquiry by the disciplinary authority or the Enquiry Officer as a matter of course. The Court cannot sit in appeal over those findings and assume the role of the Appellate Authority. But this does not mean that in no circumstance can the Court interfere. The power of judicial review available to the High Court as also to this Court under the Constitution takes in its stride the domestic enquiry as well and it can interfere with the conclusions reached therein if there was no evidence to support the findings or the findings recorded were such as could not have been reached by an ordinary prudent man or the findings were perverse or made at the dictate of the superior authority. In Nand Kishore vs. State of Bihar, AIR 1978 SC 1277 = (1978) 3 SCC 366 = 1978 (3) SCR 708, it was held that the disciplinary proceedings before a domestic Tribunal are of quasi-judicial character and, therefore, it is necessary that the Tribunal should arrive at its conclusions on the basis of some evidence, that is to say, such evidence which, and that too, with some degree of definiteness, points to the guilt of the delinquent and does not leave the matter in a suspicious state as mere suspicion cannot take the place of proof even in domestic enquiries. If, therefore, there is no evidence to sustain the charges framed against the delinquent, he cannot be held to be guilty as in that event, the findings recorded by the Enquiry Officer would be perverse. The findings, recorded in a domestic enquiry, can be characterised as perverse if it is shown that such a finding is not supported by any evidence on record or is not based on the evidence adduced by the parties or no reasonable person could have come to those findings on the basis of the that evidence. This principle was laid down by this Court in State of Andhra Pradesh vs. Sree Rama Rao. 1964 2 LLJ 150 = AIR 1963 SC 1723 = 1964 (3) SCR 25, in which the question was whether the High Court, under Article 226, could interfere with the findings recorded at the departmental enquiry. This decision was followed in Central Bank of India vs. Prakash Chand Jain, 1969 2 LLJ 377 (SC) = AIR 1969 SC 983 and Bharat Iron Works vs. Bhagubhai Balubhai Patel & Ors. 1976 Labour & Industrial Cases 4 (SC) = AIR 1976 SC 98 = 1976 (2) SCR 280 = (1976) 1 SCC 518. In Rajinder Kumar Kindra vs. Delhi Administration through Secretary (Labour) and Others. AIR 1984 SC 1805 = 1985 (1) SCR 866 = (1984) 4 SCC 635, it was laid down that where the findings of misconduct are based on no legal evidence and the conclusion is one to which no reasonable man could come, the findings can be rejected as perverse. It was also laid down that where a quasi-judicial tribunal records findings based on no legal evidence and the findings are his mere ipse dixit or based on conjectures and surmises, the enquiry suffers from the additional infirmity of non-application of mind and stands vitiated. Normally the High Court and this Court would not interfere with the findings of fact recorded at the domestic enquiry but if the finding of "guilt" is based on no evidence, it would be a perverse finding and would be amenable to judicial scrutiny. A broad distinction has, therefore, to be maintained between the decisions which are perverse and those which are not. If a decision is arrived at on no evidence or evidence which is thoroughly unreliable and no reasonable person would act upon it, the order would be perverse, But if there is some evidence on record which is acceptable and which could be relied upon, howsoever compendious it may be the conclusions would not be treated as perverse and the findings would not be interfered with. In the light of the above principles, let us scrutinise the case in hand. The charge framed against the appellant in the instant case is as under:- "You, Constable Kuldeep Singh No.2138/SD. are hereby charged that while posted at P.P. Amar Colony on 22.2.1990. You kept illegally Rs.200/out of Rs. 1000/- given by the factory owner, Smt. Meena Mishra running her factory at A-25, Garhi Lajpat Nagar for the payment of her laborers, Shri Radhey Shyam S/O Shri Phool Vash. Shri Rapal Singh S/O Shri Brahma Nand and Shri Shiv Kumar S/O Shri Ganga Ram. All these three laborers had made a complaint that Smt. Meena Mishra had stopped their payment or Rs. 2200/- for three months. The above act your part amounts to grave misconduct and unbecoming of a police officers which renders you, constable Kuldeep Singh No. 2138/SD, liable for punishment u/s 21 of Delhi Police Act, 1978. Sd/- Shakti Singh SHAKTI SINGH Inspector, Enquiry Officer, DE Cell, Vigilance, Delhi." The list of witnesses who were proposed to be examined at the domestic enquiry, as set out in the charge-sheet, was:- List of witnesses 1. Sh. D.D. Sharma, Insp. He will move him the then S.H.O. Lajpat to present. Nagar, 2. Smt. Meena Mishra R/O She will depose A-25, Garhi, Lajpat Nagar, that she had Nagar, given Rs.1000/- to Ct. Kuldeep Singh on 22.2.1990 for payment to 3 laborers and Constable had kept Rs. 200/with him. 3. Sh. Rajpal Singh He will depose S/O Brahama Nand that on 22.2.90 R/O Village Ram he along with Nagar, P.S. Baroli Shiv Kumar and Distt. Etah (U.P.) Radhey Shyam had gone to factory A-25, Garhi with Ct. kuldeep Singh for settlement of payment and he kept Rs.200 with him. 4. Radhey Sham S/O Phool Vash R/o Distt. Etah Village Bulal Puri --do-- U.P. at present H.No. 74 Main Market Garhi Lajpat Nagar. SO/DE Cell" The list of documents, indicated in the charge-sheet, was:- List of documents. ----------------- 1. Copy of report of SHO/Lajpat Nagar, dated 5.3.1990 against Constable Kuldeep Singh No.2138/SD. 2. Copy of Laborers Statement. SO/DE Cell." The charge against the appellant thus was that on 22.2.1990, three laborers namely, Radhey Shyam, Rajpal Singh and Shiv Kumar who were working in the factory of Smt. Meena Mishra at A-25, Garhi, Lajpat Nagar, and had not been paid their salary by the factory owner had approached the appellant who was posted at Police Post, Amar Colony, attached to P.S. Lajpat Nagar, New Delhi, for his help in the matter. The appellant along with the aforesaid laborers went to the factory owner who gave Rs. 1000/- to the appellant for payment to the three laborers but the appellant did not pay the whole of the amount to them and instead gave them only Rs. 800/-, keeping an amount of Rs. 200/- in his own pocket. In order to prove this charge, the Department examined Inspector D.D. Sharma, SHO, P.S. Lajpat Nagar; and Smt. Meena Mishra. Their statements have been reproduced in copious details in the findings submitted by the Enquiry Officer, a copy of which has been placed on the record. Smt. Meena Mishra stated that the three persons, namely, Rajpal Singh, Radhey Shyam and Shiv Kumar, were working in her factory, to whom she had made payment separately and individually. She stated. that she had paid Rs. 563/- to Rajpal; Rs.211/- to Shiv Kumar and another sum of Rs. 808/- jointly to Radhey Shyam and Rajpal. She stated that she had not paid Rs. 1000/- to Kuldeep Sing (appellant) on 22.2.1990, as she had asked the three laborers to come after a few days and it was then that the whole of the amount described above which was due from her was paid to them. Inspector D.D. Sharma, who was, at the relevant time. posted as S.H.O. P.S. Lajpat Nagar, New Delhi. stated that he had received a complaint from Radhey Shyam, Rajpal Singh and Shiv Kumar. They were summoned to the Police Post, Amar Colony where the contents of the complaint were verified from them and their statement was recorded. No other witness was examined on behalf of the Department, not even the complainants, Rajpal Singh and Radhey Shyam, though their names were mentioned in the charge-sheet for being examined as witnesses against the appellant. The appellant examined one of the complainants, namely, Shiv Kumar in defence who supported the appellant that Smt. Meena Mishra had not made any payment on 22.2.1990 but had called him and two other complainants, namely, Radhey Shyam and Rajpal Singh after few days and when they went again to her, she made the full payment. The appellant also examined constable Shoukat Ali who was posted, at the relevant time, at Police Post Amar Colony. He stated that Radhey Shyam, Shiv Kumar and Rajpal Singh had come to the Police Post to make a complaint against Smt. Meena Mishra that she had not paid them their salary. This constable directed them to meet the Emergency Officer, ASI Bhopal Singh who sent the appellant with them to Smt. Meena Mishra. The appellant came back and informed ASI Bhopal Singh that Smt. Meena Mishra had agreed to pay the amount due from her to these three persons after a few days. ASI Jagdish Prasad and ASI Bhopal Singh, who were also examined in defence, corroborated the above statement of constable Shoukat Ali. ASI Bhopal Singh further stated that the appellant was deputed by him to go to Smt. Meena Mishra with the complainants and the the appellant, on his return from the factory, told him that Smt. Meena Mishra had agreed to make payment to the three laborers a few days later. The witness, however, stated that all the three laborers had come to Police Post, Amar Colony of P.S. Lajpat Nagar on 22.2.1990 where their statement was recorded by ASI Jagdish Prasad on the dictation of SHO D.D. Sharma. This statement was placed on the record before the Enquiry Officer. This was the entire evidence produced at the domestic enquiry. What immediately strikes the mind is that Smt. Meena Mishra, who is alleged to have paid the amount of Rs. 1000/- to the appellant, stated in clear terms as a witness for the Department, that she had not made any payment to the appellant. This payment is not proved in any other manner as none of the three recipients of the above amount, who were the complainants, has been produced at the departmental enquiry, though two of them, namely, Radhey Shyam and Rajpal Singh were proposed to be examined. Non-production of the complainants is sought to be justified with reference to Rule 16(3) of the Delhi Police (F&A) Rules, 1980. Rule 18(3) is an under:- "If the accused police officer does not admit the misconduct, the E.O. shall proceed to record evidence in support of the accusation as is available and necessary to support the charge. As far as possible the witnesses shall be examined direct and in the presence of the accused, who shall be given opportunity to take notes of their statements and corssexamine them. The E.O. is empowered, however, to bring on record the earlier statement of any witness whose presence cannot, in the opinion of such officer be procured without undue delay, inconvenience or expense necessary provided that it has been recorded and attested by a police officer superior in rank to the accused officer or by a Magistrate and is either signed by the person making it or has been recorded by such officer during an investigation or a judicial enquiry or trial. The statements and documents so brought on record in the departmental proceedings shall also be read out to the accused officer and shall be given an opportunity to take notes, Unsigned statements shall be brought on record only through recording the statements of the officer or Magistrate who had recorded the statement of the witness concerned. The accused shall be bound to answer any questions which the E.O. may deem fit to put to him with a view to elucidating the facts referred to in the statements or documents thus brought on record." This Rule, which lays down the procedure to be followed in the departmental enquiry, itself postulates examination of all the witnesses in the presence of the accused who is also to be given an opportunity to crossexamine them. In case, the presence of any witness cannot be procured without undue delay, inconvenience or expense, his previous statement could be brought on record subject to the condition that the previous statement was recorded and attested by a police officer superior in rank than the delinquent. If such statement was recorded by the Magistrate and attested by him then also it could be brought or record. The further requirement is that the statement either should have been signed by the person concerned, namely, the person who has made that statement, or it was recorded during an investigation or a judicial enquiry or trial. The Rule further provides that unsigned statement shall be brought on record only through the process of examining the Officer or the Magistrate who had earlier recorded the statement of the witness whose presence could not be procured. Rule 16(3) is almost akin to Sections 32 and 33 of the Evidence Act. Before the Rule can be invoked, the factors enumerated therein, namely, that the presence of the witness cannot be procured without undue delay, inconvenience or expense, have to be found to be existing as they constitute the condition-precedent" for the exercise of jurisdiction for this purpose. In the absence of these factors, the jurisdiction under Rule 16(3) cannot be exercised. Rajpal Singh and Radhey Shyam, who were the original complainants along with Shiv Kumar, were not examined and the Enquiry Officer, regarding their absence, has stated in his report as under:- "The two prosecution witnessess Rajpal Singh and Radhya Shyam have not attended to proceeding. They have not been found residing in their vill. now and it had come to notice that the defaulter has managed their disappearance and has settled them some where in Devli Khanpur and also has arranged their employment but the addresses of those PWs are not known. Such is the act of the defaulter to create his defence and is an attempt to hide his misconduct. Though their complaint Ex. PW-1/A has been exhibited and has been taken on file to ascertain the facts and for natural justice. This will show that the blame for the non-availability of these two witnesses has been laid on the appellant who was already under suspension and it is not understandable as to how and on what basis or on what material, the Enquiry Officer came to the conclusion that the appellant was responsible for their disappearance or had procured employment for them in Devli Khanpur. If it was known to the Enquiry Officer that they were available in Devli Khanpur, was any attempt made to contact them at Devli Khanpur or to bring them to the enquiry proceedings from that place, is not indicated by the Enquiry Officer in his report making it obvious that the factors necessary for the exercise of jurisdiction under Rule 16(3) were not present and it was not open to the Enquiry Officer to have taken recourse to this Rule to bring on record the previous statement of the complainants which allegedly was recorded by Inspector D.D. Sharma. Moreover, the so-called previous statement itself of the complainants appears to be a highly suspicious document for the reason that S.H.O., D.D. Sharma had stated before the Enquiry Officer that he had received a complaint of Radhey Shyam, Rajpal Sing and Shiv Kumar whereupon all the three persons were summoned by him and after verifying the facts from those complainants had recorded their statement which he had dictated to ASI Jagdish Prasad. There were, therefore, two documents: (i) The original complaint made by the aforesaid three persons: (ii) The statement of these persons, recorded by ASI Jagdish Prasad, at the dictation of S.H.O., D.D. Sharma, after verifying the facts, set out in the complaint, from these persons. complaint, from these persons. (1) The original complaint was not placed on the record and it was the statement, recorded by S.H.O., D.D. Sharma, which was produced before the Enquiry Officer. The absence of original complaint, therefore, indicates that there was, in fact, no complaint in existence which further supports the statement of Department's own witness Smt. Meena Mishra that no payment was made by her on 22.02.1990. Apart from the above, Rule 16(3) has to be considered in the light of the provisions contained in Article 311(2) of the Constitution to find out whether it purports to provide reasonable opportunity of hearing to the delinquent. Reasonable opportunity contemplated by Article 311(2) means "Hearing" in accordance with the principles of natural justice under which one of the basic requirements is that all the witnesses in the departmental enquiry shall be examined in the presence of the delinquent who shall be given an opportunity to cross-examine them. Where a statement previously made by a witness, either during the course of preliminary enquiry or investigation, is proposed to be brought on record in the departmental proceedings, the law as laid down by this Court is that a copy of that statement should first be supplied to the delinquent, who should thereafter be given an opportunity to cross-examine that witness. In State of Mysore vs. Shiv Basappa 1963(2) SCR 943 = AIR 1963 SC 375, the witness was not examined in the presence of the delinquent so far as his examination-in-chief was concerned and it was his previous statement recorded at an earlier stage which was brought on record. That statement was put to the witness who acknowledged having made that statement. The witness was thereafter offered for cross-examination and it was held that although the statement (examination-in-chief) was not recorded in the presence of the delinquent, since the witness had been offered for cross-examination after he acknowledged having made the previous statement, the rules of natural justice were sufficiently complied with. In Kasoram Cotton Mills Ltd. vs. Gangadhar 1964(2) SCR 809 = AIR 1964 SC 708 AND State of U.P. vs. Om Prakash Gupta, AIR 1970 SC 679, the above principles were reiterated and it was laid down that if a previous statement of the witness was intended to be brought on record, it could be done provided the witness was offered for cross-examination by the delinquent. Having regard to the law as set out above, and also having regard to the fact that the factors set out in Rule 16(3) of the Delhi Police (F&A) Rules, 1980, did not exist with the result that Rule 16(3) itself could not be invoked, we are of the opinion that the Enquiry Officer was not right in bringing on record the so-called previous statement of witnesses Radhey Shyam and Rajpal Singh. It will be noticed that there were three complainants but only two, namely, Radhey Shyam and Rajpal Singh were proposed to be examined. Why was not the third complainant, Shiv Kumar, proposed to be examined? The reason becomes obvious from the fact that when he was examined as a Defence witness, he fully supported the appellant by stating that no payment was made by Smt. Meena Mishra on that date. But he was held by the Enquiry Officer to be an impostor on the ground that he had not proved himself to be actual Shiv Kumar. The Enquiry Officer has observed as under:- "DW 1, Sh. Shiv Kumar is a prepared witness and has not proved himself to be actual Shiv Kumar. This DW 1 has denied that he had visited the police station and had never met with SHO. Moreover he has denied to have signed EX PW-A/A. He had not made any complaint to the SHO. His version has been contradicted by ASI Jagdish Prasad, DW-4 the writer of this complaint Ex PW-1/A. Both these defaulter himself. So the statement of DW-1, Shiv Kumar has not been relied upon because he is not actual Shiv Kumar who is a complainant in this case and is a false person who has been produce by the defaulter." The reasons why he has been held to be an impostor or a false person have not been indicated. The finding in this regard is wholly arbitrary and perverse. The findings recorded by the Enquiry Officer, have also been upheld by the Deputy Commissioner of Police, South District, New Delhi who had passed the order on 3rd of May, 1991 by which the appellant was dismissed from service. The Addl. Commissioner of Police, before whom the appeal was filed by the appellant, also agreed with the findings recorded by the Enquiry Officer as also the Deputy Commissioner and dismissed the appeal on 22.07.1991. From the findings recorded separately by the Deputy Commissioner of Police, it would appear that there is a voucher indicating payment of Rs. 1000/- to Rajpal Singh, one of the labourers, on 8th of February, 1990. This document was not mentioned in the chargesheet in which only two documents were proposed to be relied upon against the appellant, namely, copy of the report of S.H.O., Lajpat Nagar dated 5th of March, 1990 against the appellant and the copy of the labourers' statement. This document has, therefore, to be excluded from consideration as it could not have been relied upon or even referred to by the Dy. Commissioner of Police. Moreover, according to the charge framed against the appellant, payment was made on 22.2.90 and not on 08.02.90 as indicated in the voucher and, therefore, voucher, for this reason also, has to be excluded. To sum up, the charge against the appellant consisted of two components, namely : (a) On 22.2.90 Smt. Meena Mishra paid Rs. 1000/- to the appellant for being paid to the three labourers. (b) Appellant paid Rs. 800/- to labourers and kept Rs. 200/- with himself. Smt. Meena Mishra, appearing as a witness for the Department, denied having made any payment to the appellant on that day. The labourers to whom the payment is said to have been made have not been produced at the domestic enquiry. Their so-called previous statement could not have been brought on record under Rule 16(3). As such, there was absolutely no evidence in support of the charge framed against the appellant and the entire findings recorded by the Enquiry Officer are vitiated by reason of the fact that they are not supported by any evidence on record and are wholly perverse. The Enquiry Officer did not sit with an open mind to hold an impartial domestic enquiry which is an essential component of the principles of natural justice as also that of "Reasonable Opportunity", contemplated by Article 311(2) of the Constitution. The "Bias" in favour of the Department had so badly affected the Enquiry Officer's whole faculty of reasoning that even non-production of the complainants was ascribed to the appellant which squarely was the fault of the Department. Once the Department knew that the labourers were employed somewhere in Devli Khanpur, their presence could have been procured and they could have been produced before the Enquiry Officer to prove the charge framed against the appellant. He has acted so arbitrarily in the matter and has found the appellant guilty in such a coarse manner that it becomes apparent that he was merely carrying out the command from some superior officer who perhaps directed "fix him up". For the reasons stated above, the appeals are allowed. The judgment and order dated 28th February, 1997, passed by the Central Administrative Tribunal, is set aside. The order dated 3rd of May, 1991, passed by Deputy Commissioner of Police by which the appellant was dismissed from service as also the order passed in appeal by Addl. Commissioner of Police are quashed and the respondents are directed to reinstate the appellant with all consequential benefits including all the arrears of pay up-to-date which shall be paid within three months from today. There will, however, be no order as to costs.