Canon Steels P. Ltd Vs. Commissioner of Customs  Insc 1129 (12 November 2007)
Arijit Pasayat & P. Sathasivam
APPEAL NO. 5153 OF 2007 Arising out of SLP (Civil) No.7645 of 2007 Dr. ARIJIT
Challenge in this appeal is to the orders passed by the Punjab & Haryana
High Court dismissing the Customs Act Appeal No.4/2004, filed under Section 130
of the Customs Act, 1962 (in short the 'Act') dated 8th May, 2006, and the
order passed in review application dated 12.10.2006. The High Court held that
it had no jurisdiction to deal with the matter as the original order was passed
by Adjudicating authority at Mumbai and the appellate order was passed at Delhi
by the Customs, Excise and Service Tax Appellate Tribunal (in short 'CESTAT').
Reference was made to the decision of this Court in Kusum Ingots & Alloys
Ltd. V. Union of India and Anr. (2004 (6) SCC 254).
support of the appeal, learned counsel for the appellant submitted that the
judgment in Kusum Ingots (supra) is in favour of the appellant and on
misreading of the decision the appeal has been dismissed. Learned Additional
Solicitor General, on the other hand, submitted that before moving the Punjab and Haryana High Court, the Delhi
High Court was moved, and at the request of the appellant, the High Court
permitted to withdraw the appeal (wrongly stated as writ petition).
factual position is not in dispute. The adjudication order under the Act was
passed by the Commissioner of Customs (EP Mumbai) and the appeal against that
order was adjudicated by CESTAT. Against the order of CESTAT, Customs Appeal
No.6/04 was filed before the Delhi High Court. It is submitted by learned
counsel for the appellant that prima facie, the High Court was of the view that
the appeal was not maintainable before it and, therefore, the appellant
withdrew the said appeal to file it before the appropriate High Court. Since
the cause of action arose at Chandigarh it
was submitted that the Punjab and Haryana High Court has jurisdiction.
this juncture, it would be appropriate to take note of what has been stated by
this Court in Kusum Ingots (supra).
Court must have the requisite territorial jurisdiction.
order passed on a writ petition questioning the constitutionality of a
Parliamentary Act, whether interim or final keeping in view the provisions
contained in clause (2) of Article 226 of the Constitution of India, will have
effect throughout the territory of India subject of course to the applicability
of the Act.
Learned counsel for the appellant in support of his argument would contend that
the situs of framing law or rule would give jurisdiction to the Delhi High
Court and in support of the said contention relied upon the decisions of this
Court in Nasiruddin v. STAT (1975 (2) SCC 671), and U.P. Rashtriya Chini Mill Adhikari
Parishad v. State of U.P. (1995 (4) SCC 738).
as the decision of this Court in Nasiruddin's case (supra) is concerned, it is
not an authority for the proposition that the situs of legislature of a State
or the authority in power to make subordinate legislation or issue a
notification would confer power or jurisdiction on the High Court or a Bench of
the High Court to entertain a petition under Article 226 of the Constitution.
In fact, this Court while construing the provisions of the United Provinces
High Courts (Amalgamation) Order, 1948 stated the law thus: (SCC p. 683, para
37) "37 . The conclusion as well as the reasoning of the High Court is
incorrect. It is unsound because the expression 'cause of action' in an
application under Article 226 would be as the expression is understood and if
the cause of action arose because of the appellate order or the revisional
order which came to be passed at Lucknow then Lucknow would have jurisdiction
though the original order was passed at a place outside the areas in Oudh. It
may be that the original order was in favour of the person applying for a writ.
In such case an adverse appellate order might be the cause of action. The
expression 'cause of action' is well known. If the cause of action arises
wholly or in part at a place within the specified Oudh areas, the Lucknow Bench will have jurisdiction. If
the cause of action arises wholly within the specified Oudh areas, it is indisputable that the Lucknow Bench
would have exclusive jurisdiction in such a matter. If the cause of action
arises in part within the specified areas in Oudh it would be open to the litigant who is the dominus litis to have his
forum conveniens. The litigant has the right to go to a court where part of his
cause of action arises. In such cases, it is incorrect to say that the litigant
chooses any particular court. The choice is by reason of the jurisdiction of
the court being attracted by part of cause of action arising within the
jurisdiction of the court.
if the cause of action can be said to have arisen part within specified areas
in Oudh and part outside the specified Oudh areas, the litigant will have the choice to
institute proceedings either at Allahabad or Lucknow. The court will find out in each
case whether the jurisdiction of the court is rightly attracted by the alleged
cause of action."
said decision is an authority for the proposition that the place from where an
appellate order or a revisional order is passed may give rise to a part of
cause of action although the original order was at a place outside the said
area. When a part of the cause of action arises within one or the other High
Court, it will be for the petitioner to choose his forum.
must, however, remind ourselves that even if a small part of cause of action
arises within the territorial jurisdiction of the High Court, the same by
itself may not be considered to be a determinative factor compelling the High
Court to decide the matter on merit. In appropriate cases, the Court may refuse
to exercise its discretionary jurisdiction by invoking the doctrine of forum conveniens.
[See Bhagat Singh Bugga v. Dewan Jagbir Sawhney (AIR 1941 Cal 670), Madanlal Jalan
v. Madanlal (AIR 1949 Cal 495), Bharat Coking Coal Ltd. v. Jharia Talkies &
Cold Storage (P) Ltd. (1997 CWN 122) , S.S. Jain & Co. v. Union of India (1994 (1) CHN 445) and New Horizons
Ltd. v. Union of India (AIR 1994 Del 126.]
The appellate order in this case was issued from CESTAT office at New Delhi. In that sense the Delhi High Court
has jurisdiction to deal with the matter in terms of what has been stated in
paragraph 25 of Kusum Ingot's case (supra).
The Punjab & Haryana High Court was justified in its view as the original
adjudication order and the appellate order were not issued by any authority
within its territorial jurisdiction. But no person should be left without a
remedy, therefore, even though the Customs Case No.6/04 was withdrawn by the assessee,
we direct the restoration of the said as undisputably, the Delhi High Court has
jurisdiction to deal with the matter.
Customs Case No.6/04 in the Delhi High Court needless to say shall be dealt
with on merits.
make it clear that we have not expressed any opinion on the merits of the
The appeal is accordingly disposed of without any order as to costs.