Bombay H.C : This appeal can be disposed of even at the stage of admission, since we are inclined to confirm a part of the order of the Single Judge but are of opinion that a part of the order cannot be sustained. If that be, immediate action on the latter part appears desirable as will be made clear subsequently.

Counsel Appeared

K.K. Singhvi with B.N. Singhvi, for the Appellant : D.R. Dhanuka with K.J. Jetley, Manjula Singh, K.C. Sidhwa, N.B. Jagad, Ashok H. Desai, G.E. Vahanvati & C.A. Jani i/b Gagrat & Co. for the Respondents

S.K. DESAI, J.:

This appeal can be disposed of even at the stage of admission, since we are inclined to confirm a part of the order of the Single Judge but are of opinion that a part of the order cannot be sustained. If that be, immediate action on the latter part appears desirable as will be made clear subsequently.

Accordingly, the appeal is admitted. Counsel for the respective respondents waive service. By consent, the appeal is taken up for hearing and advocates are fully heard. This appeal is preferred against the decision given by the Single Judge on 20th March, 1987 summarily rejecting Writ. Petn. No. 458 of 1987 in limine, though with a detailed speaking order. A few facts may be stated. This writ petition has been filed by an advocate practicing in this Court and is described as public interest litigation. The writ petition has a dual or a treble thrust. In the first instance, the writ petitioner alleges that the scheme of amnesty propounded under certain circulars and clarifications issued by or on behalf of the CBDT which are indicated in prayer (a) should be quashed for the reasons indicated in paragraphs 6, 6A and 6B of the writ petition. The principal submission in this behalf is that these go beyond the power of the Board conferred under s. 119(2) of the IT act, 1961. In the second place what has been impugned is the immunity or amnesty allegedly granted to respondent No. 3 under the said amnesty scheme. Finally and that appears to be the principal trust of the writ petition, it is averred that the appointment of respondent No. 3 as the sheriff of Bombay by the state of Maharashtra w.e.f. 20th Dec., 1986 should be quashed by a writ of quo warranto or a writ of mandamus or any other appropriate writ.

We shall turn to the second and the third aspects in the first instance. As far as the second aspect is concerned, there is a clear statement made on behalf of the union of India that the proposals for settlement or grant of amnesty are still pending consideration and no final decision has been arrived at. In view of that categorical statement which is noted by the Single Judge in paragraph 6 of the impugned order, we feel that we are not called upon to go into that aspect of the matter any further.

We now turn to the third point and that is regarding the appointment of respondent No. 3 as the Sheriff of Bombay w.e.f. 20th Dec., 1986. Since the appointment is for one year, it will come to an end on 19th Dec., 1987.

It may be mentioned that in respect of this very appointment, writ petition No. 325 of 1987 was filed by one Ramdas Nayak. It came up for admission before another Single Judge on 6th Feb., 1987. The amnesty scheme or its application thereof to the case of respondent No. 3 was not the subject-matter of the said petition, but only his appointment as the Sheriff of Bombay. After perusing the affidavit, in reply of respondent No. 3 the learned Single Judge observed that the allegations made against him “are without substance”. The other legal argument advanced that the office of the Sheriff is that of an officer of the High Court and that, therefore, the incumbent to this office could only be appointed by the High Court under Art. 229 of the Constitution of India was also not accepted by the Single Judge. Accordingly the said writ petition was rejected.

In the present writ petition (No. 458 of 1987) the learned Single Judge, whose order is impugned in the appeal before us, observes that this challenge was concluded by reason of the decision in Ramdas Nayak’s writ petition and, therefore this plea in the present petition was not entertainable on account of principles of constructive res judicata relatable to the writ petition as enumerated by the Supreme Court in Forward Construction Co. vs. Prabhat Mandal AIR 1986 SC 391.

The appointment of the Sheriff is under the Letters Patent. The duties of this office are found enumerated in a letter addressed by the Deputy Sheriff dt. 20th Dec., 1986, which is to be found as Ex. P 2 to the reply filed by the respondent No. 3 in Ramdas Nayak’s writ petition. Of course, the administrative and judicial duties are in fact attended to by the Deputy Sheriff but in the name of the Sheriff. The Sheriff personally participates in the ceremonial duties attached to his office.

In paragraph 7 of the present writ petition are to be found the factual averment on the basis of which the writ petitioner assails the appointments of respondent No. 3 as the Sheriff. Substantially similar averment, though perhaps in a somewhat truncated form, were to be found in paragraph, 13, of Ramdas Nayak’s writ petition earlier rejected by another Single Judge.

It is impossible to subscribe our concurrence with the observations made by the Single Judge in Ramdas Nayak’s case that the allegation against respondent No. 3 were without substance. As the record stood, it was and is not possible for the Court to observe that they are disproved or shown to be without any basis. All that the Court could opine was that the allegations were fairly serious, that at least in the present petition the language occasionally bordered on the intemperate, and that prima facie the Court could not hold the allegations as proved as likely to be proved so that drastic action or relief sought for should be granted or should be considered for passing appropriate interim orders. When we make these observations, it may not be taken or implied that we are making observations to the other effect, namely that we are satisfied with the truth of the allegations. In any respect or that there is some truth in the allegations. The matters are still being agitated in Courts of law, assessments are still to be completed and at this stage of the record, it is impossible to opine with any degree of finality or confidence one way or the other.

It would not be proper in our opinion to take recourse to the principles of constructive res judicata to deny consideration of this head of the claim, although it is true that the principle has been accepted and considered in a number of Supreme Court decisions. In our view where necessary directions have been given under order 1, r. 8 of CPC, 1908, and advertisement given in pursuance of such directions, then any decision subsequently given, whether fully satisfactory or not, whether, based on full arguments or not or irrespective of whether all the available submissions were made or not, should normally preclude fresh consideration of the same point in another proceeding. This is because it was open to the person who moves the Court on the second occasion to have sought to intervene in the earlier proceedings. Once he fails to avail of this opportunity he cannot be heard again. Ignoring for the time being the principle of constructive res judicata and adhering to the views expressed that the clean chit given by the Single Judge (in Ramdas Nayak’s petition) was not justified, we are required to consider the challenge to the appointment of respondent No. 3 by the Council of Ministers which is the body in whom the power to appoint the Sheriff seems to be vested as a matter of law.

In this connection it will have to be noted that the affidavit made on behalf of the state of Maharashtra by one Satish Tripathi, Joint Secretary, General Administration Department, is not at all satisfactory or helpful. This is an affidavit made on 25th Feb., 1987. By this time, comments had appeared in the press about the appointment of respondent No. 3 and, indeed, xerox copies of some of the newspaper articles andor editorial have been annexed by the petitioner to the petition. The raid on Daya’s residence and businesses has taken place as far back as October 1983. It is a little naive in these circumstances to state that the Government, was not and even in February 1987, is not, aware of these factual allegations. The Advocate General tried to explain the tenor of the affidavit by suggesting that the deponent was merely pleading to the intemperate language and the extreme allegations made in the petition. To a certain extent, the explanation holds water, but what we expect from the Government in such matters is a full disclosure indicating the manner in which the appointments are made generally and how this appointment came to be made in particular. Affidavits made in this manner give rise to suspicion that there is something improper in the State of Maharashtra.

It is the admitted position that no qualifications are laid down for the appointment to the office of the Sheriff. However, in the warrant of precedence, he has been given a fairly prominent place and again he has a pre-eminent position in the social life of the city. The question raised by the petitioner, however appears to be a matter of proprieties and breach of norms rather than a breach of law. Of course, Mr. Singhvi put in very cleverly as a case of admitted non-application of mind, and this argument was based upon the unsatisfactory affidavit of Mr. Tripathi. Broadly speaking, however, it will have to be held that this is not a case of appointment of a person who is either suffering a prosecution at present or who has been convicted by a Court of law of any offence involving moral turpitude. In such cases, the violation of proprieties would be extreme as would compel the Court to equate the decision as one being totally devoid of application of mind. The position in the case of an income-tax raid or search and seizure operation which has not resulted in prosecution or punishment is not identical with and cannot be equated to either a pending prosecution work or conviction on a charge of moral turpitude. The present situation therefore, is not one which seems to call for intervention by the Court. The appointment of the Sheriff is an a executive decision of the Council of; Ministers. The Council of Ministers is responsible to the State legislature immediately and to the voters of the State in the ultimate analysis. It is the legislature which can question the appointment and the M.L.As can seek by any appropriate method the reasons for such appointment and if so inclined, indicate their displeasure. The State legislature is the right forum in which such grievance is required to be raised and should be raised by any appropriate manner and any explanation must be offered and will have to be offered at that forum. The bar of public opinion will have to be satisfied before the Legislature and not in the Court of law. There is a clear distinction between illegality and impropriety. In the case of the former, recourse to a Court of law is appropriate and where the impropriety is so gross, then also perhaps the Court can permit itself to trespass upon what ordinarily should be left to the State legislature. In the instant case, although we may not be fully happy with the appointment, and this is an assumption only for the sake or argument, we must refrain form seeking an explanation or considering the same and thereafter confirming or not confirming it. This conclusion is reached, since we are of the opinion that the impropriety suggested is not of the nature which will permit intervention of the High Court in its writ jurisdiction. The writ jurisdiction, although extensive and perhaps all pervasive, should not be utilized lightly. The principle of separation of powers must be respected and the executive must be left to render up to the legislature what is within the latter’s domain without interference in the same by the judicial branch.

It is on this limited footing and not on the footing and not on the footing which appealed to the Single Judge in Ramdas Nayak’s case or the footing which appealed to the Single Judge in the present petition that we sustain the non-issue of the rule on this third point. That brings us to the consideration of prayer (a) namely, the challenge to the amnesty scheme as going beyond the powers of the CBDT conferred under s. 119(2) of the IT Act, 1961.

It was pointed out by Mr. Singhvi that in the earlier scheme, such as Voluntary Disclosure Scheme or even the Tyagi Scheme or the Special Bearer Bonds Scheme, the proposals and the provisions came into being directly under the aegis of Parliament and Parliament had either by law or under the rules full control on, and over, these schemes. He took us very briefly through the judgment given by the Supreme Court where such schemes or provisions were upheld because it was law made or controlled by Parliament and the Court opined that it would not substitute its own approach of ethics to that of Parliament. On the other hand, Mr. Dhanuka was at pains to point out that the scheme was mentioned categorically and clearly in the long-term financial policy speech made in December 1985, by the Finance Minister as also referred to in the next budget speech. He was at pains to point out that there was nothing surreptitious about the same and Parliament, and possibly the Consultative Committee of Parliament(attached to the Finance Ministry) have had full opportunity of discussing the scheme and its extensions. He also pointed out that the scheme was one announced in June, 1985, and the last date of making a disclosure and seeking amnesty expired on 31st March, 1987. In his submission, it was not in the public interest that all acts done under the scheme as promulgated should be undone. According to him, this will result in a chaotic state or affairs. In connection with this head of the argument, it was submitted that the scheme was a part of tax management which must be left to the CBDT and was promulgated on account of practical considerations and an embodiment of the “carrot and stick” policy of the previous Finance Minister. In his submission, there was also unexplained delay on the part of the petitioner in coming to the Court against this scheme. We find considerable substance in these arguments. It was also urged that the petitioner was not motivated in upholding the public morality against such allegedly unethical scheme but had moved the Court only because the benefit of the same was sought to be taken by or extended or respondent No. 3. we were taken by the Council through various circulars. In respect of one of them, namely, remission of interest, we find that the scheme to a certain extent seemed to go beyond the statutory provisions. It is true that the deviation from statutory provisions, as far as certain section of the IT Act are concerned, has been done by the circulars in the past and these circulars have been applied when they were in favour of the assessee. However, this was principally done in the appeals against the assessment orders or references arising from such assessment orders or writ petitions filed against the assessment orders. In none of the proceeding could the Revenue have urged or did urge that the circular was unconstitutional or ultra vires the IT Act. If there is a circular issued by the CBDT, the authorities under the Tax Act are bound to give effect to the same if it be in favour of the assessee. Here, however, the petitioner impugns the basis, both legal and ethical, of the entire scheme and submits that such a scheme can never be permitted to be effected through the circulars of the Board.

In paragraph 9 of the judgment of the Single Judge, there is a reference to circulars having been upheld by the Court in a number of judgments, but the point being considered therein was more of application than of the legality or constitutionality of the circulars.

In our opinion, despite the very substantial points urged by Mr. Dhanuka regarding delay and practical consideration, the points raised or sought to be raised in prayer (a) of the writ petition does require fuller consideration and it cannot be brusquely or lightly rejected, as appears to have been done by the Single Judge. It may be that the Court at the final hearing may refrain from interfering with the disclosures made under the present scheme and that at the same time opine that the manner was improper. This course may be followed on account of the points urged by Mr. Dhanuka or on similar or other considerations. In our opinion, no chaos is likely to result or difficulty caused merely because a rule is issued, since this is clearly not a matter for any interim stay of any type.

In the result, the order of rejection of the writ petition as far as prayers (b) and (c) thereof are concerned is sustained. The rejection of the writ petition as far as prayer (a) is concerned is not sustained and, in our opinion, rule must be issued but restricted to prayer (a) of the writ petition. However, we make it clear that there is no warrant for staying the operation of any circular as sought for in prayer (d). The question of issuing any orders in terms of prayer (e) does not and cannot arise. Appeal is partly allowed to the extent indicated above. Mr Dhanuka on behalf of respondent No. 1 who is the only respondent concerned with prayer (a), waives service. The return is to be filed on or before 8th June, 1987. After the return is filed, papers to be placed before the Hon’ble Chief Justice under r. 28 of the Rules of the High Court of Judicature at Bombay (original side) Rule, 1988, to consider whether the writ petition should be straightway placed for consideration by a Bench instead of a Single Judge. Since there is partial success and partial failure in the appeal, the parties are directed to bear their own costs of the appeal.

[Citation : 171 ITR 334]