Shivhare Vs. Asst. Dir. Directorate of Enfort.& ANR.  INSC 271 (12
SUPREME COURT OF INDIA CIVIL APPELLATE JURISDICTION CIVIL APPEAL NO.3221 OF
2010 (Arising out of SLP (Civil) No.28877 of 2008) Raj Kumar Shivhare
..Appellant(s) Versus Assistant Director, Directorate of Enforcement &
appeal arises out of the Division Bench judgment of the High Court of Delhi in
filed by the appellant-Rajkumar Shivhare.
3. A Writ
Petition was filed challenging the order dated 17.7.2008 of the Appellate
Tribunal for Foreign Exchange, Janpath, New Delhi, (hereinafter `the
Tribunal'), on various grounds with which this 1 Court is not concerned. By
that order, the Tribunal refused to dispense with the pre-deposit of penalty by
the appellant and the concluding portion of that order is:
the application for dispensation of pre-deposit of penalty is dismissed and
rejected but the appellant is permitted to deposit full amount of penalty
within thirty days from the date of receipt of the order failing which the
appeal will be dismissed on this ground alone. The appeal is fixed for hearing
on 4th September, 2008".
facts of the case in brief are as follows:
appellant, along with another person, were issued a notice dated 12.1.2005
under Section 3(c) of the Foreign Exchange Management Act, 1999 (FEMA) for
receiving unauthorized payments worth Rs.5 crores under instructions from
persons living outside India in connection with his illegal cricket betting
operation. He was also asked to explain why the amount of Rs.1 lac, confiscated
during search from his residence, should not be credited to the account of the
Central Government under Section 13(2) of FEMA, 1999.
5. As the
charges were proved against him, a penalty of Rs.2 crores was imposed on him
and the confiscated money was disposed of according to Section 13(2) vide order
appeal to the Appellate Tribunal under Section 19(2) of the Act, the Tribunal
passed the order dated 17.7.2008, the concluding portion whereof is quoted
a writ petition came to be filed challenging the order dated 17.7.2008.
High Court, without going into the merits of the petition, accepted the
preliminary objection raised by the respondent that the High Court of Delhi did
not have territorial jurisdiction to decide the matter. High Court of Delhi
rejected the writ petition on that ground and gave liberty to approach the
appropriate High court.
dismissing the writ petition, on the ground that it lacked territorial
jurisdiction, the High Court relied on the decision of this Court rendered 3 in
Ambica Industries vs. Commissioner of Central Excise, (2007) (6) SCC 769, on
the interpretation of Section 35 of FEMA.
High Court in its judgment gave the following reasoning:
position is analogous to that of the Union Government. The statement that the
Union Government is located throughout every part of Indian Territory and hence
can be sued in any Court of the country, brooks no cavil.
not, however, inexorably lead to the consequence that a litigant can pick and
choose between any Court as per his caprice and convenience..."
held that in exercising its powers under Article 226, a High Court must
consider that the person, Authority or Government is located within its
territories or a significant part of the cause of action has arisen within its
territories. It referred to Ambica Industries (supra) again where this Court
held that ".....the aggrieved person is treated to be the dominus litis,
as a result whereof, he elects to file the appeal before one or the other High
Court, the 4 decision of the High Court shall be binding only on the
authorities which are within its jurisdiction. It will only be of persuasive
value on the authorities functioning under a different jurisdiction. If the
binding authority of a High Court does not extend beyond its territorial
jurisdiction and the decision of one High Court would not be a binding
precedent for other High Courts or courts or tribunals outside its territorial
jurisdiction, some sort of judicial anarchy shall come into play.
assessee, affected by an order of assessment made at Bombay, may invoke the
jurisdiction of the Allahabad High Court to take advantage of the law laid down
by it and which might suit him and thus he would be able to successfully evade
the law laid down by the High Court at Bombay. ...
also give rise to the problem of forum shopping. ....For example, an assessee
affected by an assessment order in Bombay may invoke the jurisdiction of the
Delhi High Court to take advantage of the law laid down by it which may be
contrary to the judgments of the High Court of Bombay".
Court also relied on the Explanation (a) to Section 35 of FEMA, which states
that "High Court", to which an appeal from an order of the Appellate
Tribunal under Section 35 of the Act lies, means "the High Court within
the jurisdiction of which the aggrieved party ordinarily resides or carries on
business or personally works for gain".
13.Though High Court dismissed the writ petition on the issue of territorial
jurisdiction, it missed a rather fundamental issue which is discussed
commencement of the hearing, this Court questioned the very maintainability of
the Writ Petition against an order of the Tribunal in view of the provisions of
Section 35 of FEMA.
Learned Counsel for the appellant sought to answer this query by contending
that (a) the remedy under Section 35 of FEMA is only against a final order, (b)
this question was not raised before the High Court, (c) the writ jurisdiction
of the High Court is part of the basic structure of the Constitution and such jurisdiction
cannot be ousted in view of Section 35 of FEMA, (d) all the High Courts in
India, are entertaining writ petitions challenging an interim order passed by
our judgment, none of the answers given by the learned counsel are tenable for
the reasons discussed below.
is a complete Code in itself. The long title of FEMA would indicate that the
same is an "Act to consolidate and amend the law relating to foreign
exchange with the objective of facilitating external trade and payments and for
promoting the orderly development and maintenance of foreign exchange market in
Act has seven Chapters and 49 Sections and out of which, Chapter V, which deals
with adjudication and Appeal, contains detailed provisions starting from
Sections 16 to 35, thus spanning 20 Sections.
styled as the Foreign Exchange Management (Adjudication Proceedings and Appeal)
Rules, 2000 have been framed in exercise of powers under Section 46 read with
sub-section (1) of Section 16, sub-section (3) of Section 17 and sub-section
(2) of Section 19 of FEMA.
is thus clear that Chapter V of FEMA, read with the aforesaid rules, provides a
complete network of provisions adequately structuring the rights and remedies
available to a person who is aggrieved by any adjudication under FEMA.
statutory scheme under Section 34 of FEMA is to exclude the jurisdiction of the
Civil Court in express terms. Section 35, which calls for interpretation in
this case, runs as follows:
Appeal to the High Court.-Any person aggrieved by any decision or order of the
Appellate Tribunal may file an appeal to the High Court within sixty days from
the date of communication of the decision or order of the Appellate Tribunal to
him on any question of law arising out of such order:
that the High Court may, if it is satisfied that the appellant was prevented by
sufficient cause from filing the appeal within the said period, allow it to be
filed within a further period not exceeding sixty days.
this section "High Court" means - (a) the High Court within the
jurisdiction of which the aggrieved party ordinarily resides or carries on
business or personally works for gain; and (b) where the Central Government is
the aggrieved party, the High Court within the jurisdiction of which the
respondent, or in a case where there are more than one respondent, any of the
respondents, 8 ordinarily resides or carries on business or personally works
reading of Section 35 makes it clear that jurisdiction has been clearly
conferred on the High Court to entertain an appeal within 60 days from `any
decision or order of the appellate authority'.
appeal has to be on a question of law.
proviso empowers the High Court to entertain such an appeal after 60 days
provided the High Court is satisfied that the appellant was prevented by
sufficient cause from appealing earlier.
argument that under Section 35 only appeals from final order can be filed has
been advanced on a misconception of the clear provision of the Section itself.
The Section clearly says that from `any decision or order' of the Appellate
Tribunal, appeal can be filed to the High Court on a question of law.
word `any' in this context would mean `all'. We are of this opinion in view of
the fact that this Section confers a right of appeal on any person 9 aggrieved.
A right of appeal, it is well settled, is a creature of Statute. It is never an
inherent right, like that of filing a suit. A right of filing a suit, unless it
is barred by Statute, as it is barred here under Section 34 of FEMA, is an
inherent right (See Section 9 of the Civil Procedure Code) but a right of
appeal is always conferred by Statute. While conferring such right Statute may
impose restrictions, like limitation or pre-deposit of penalty or it may limit
the area of appeal to questions of law or sometime to substantial questions of
law. Whenever such limitations are imposed, they are to be strictly followed.
But in a case where there is no limitation on the nature of order or decision
to be appealed against, as in this case, the right of appeal cannot be further
curtailed by this Court on the basis of an interpretative exercise. Under
Section 35 of FEMA, the legislature has conferred a right of appeal to a person
aggrieved from `any' `order' or `decision' of the Appellate Tribunal. Of course
such appeal will have to be on a question of law. In this context the word
`any' would mean `all'.
Justice Chitty in Beckett vs. Sutton (51 Law Journal 1882 Chancery Division
432) had to interpret "any decree or order" in Section 1 of the
Trustee Extension Act, 1852 and His Lordship held:- "..the words of the
section are as wide as possible, and appear to me to apply adopting the
language the Legislature has used - to "any decree or order" by which
the Court directs a sale".
word `any dispute' is somewhat akin to `any order' or `any decision'. Any
dispute, occurring in Section 51 of Arbitration Act 1975, has been interpreted
to have a wide meaning to cover all situations where one party makes a request
or demand and which is refused by the other party [See Ellerine Bros (Pty) Ltd
and another vs. Klinger, 1982 (2) AER 737].
Justice Bachawat, while in Calcutta High Court, in the case of Satyanarain
Biswanath vs. Harakchand Rupchand, reported in AIR 1955 Calcutta 225,
interpreted the word `any' in Rule 10 of Bengal Chamber of Commerce, Rules of
the Tribunal of 11 Arbitration. Construing the said rule, the learned Judge
held that the word `any' in Rule 10 means one or more out of several and
includes all and while doing so the learned Judge relied on an old decision of
the Calcutta High court in the case of Jokhiram Kaya vs. Ganshamdas Kedarnath,
AIR 1921 Cal 244 at page 246. This Court is in respectful agreement with the
aforesaid view of the learned Judge.
Black's Law Dictionary the word `any' has been explained as having a `diversity
of meaning' and may be "employed to indicate all and every as well as some
or one and its meaning in a given Statute depends upon the context and subject
matter of Statute". The aforesaid meaning given to the word `any' has been
accepted by this Court in Lucknow Development Authority vs. M.K. Gupta [(AIR)
1994 SC 787]. While construing the expression "service of any
description" under Section 2(o) of Consumer Protection Act, 1986 this
Court held that the meaning of the word `any' depends upon the context and the
subject matter of the Statute and held that the word `any' in Section 2(o) has
been used in 12 wider sense extending from one to all (para 4 at page 793 of
the report). In the instant case also when a right is conferred on a person
aggrieved to file appeal from `any' order or decision of the Tribunal, there is
no reason, in the absence of a contrary statutory intent, to give it a
in our judgment in Section 35 of FEMA, any `order' or `decision' of the
Appellate Tribunal would mean all decisions or orders of the Appellate Tribunal
and all such decisions or orders are, subject to limitation, appealable to the
High Court on a question of law.
case where right of appeal is limited only from a final order or judgment and
not from interlocutory order, the Statute creating such right makes it clear
[See Section 19 of the Family Courts Act, 1984] which is set out below:
Appeal (1) Save as provided in sub-section (2) and notwithstanding anything
contained in the Code of Civil Procedure, 1908 (5 of 1908) or in the Code of
Criminal 13 Procedure, 1973 (2 of 1974) or in any other law, an appeal shall
lie from every judgment or order, not being an interlocutory order, of a Family
Court to the High Court both on facts and on law.
appeal shall lie from a decree or order passed by the Family Court with the
consent of the parties [or from an order passed under Chapter IX of the Code of
Criminal Procedure, 1973 (2 of 1974):
that nothing in this sub- section shall apply to any appeal pending before a
High Court or any order passed under Chapter IX of the Code of Criminal
Procedure, 1973 (2 of 1974) before the commencement of the Family Courts
(Amendment) Act, 1991] (3) Every appeal under this section shall be preferred
within a period of thirty days from the date of judgment or order of a Family Court.]
(Emphasis supplied) 31.Similarly, under Section 104 of the Code of Civil
Procedure read with Order XLIII Rule 1 thereof, it has been indicated from
which interlocutory order an appeal will lie. But it has been made clear that
no Second Appeal from such order will lie [See Section 104 Sub-section (2) of
Debt Recovery Tribunal Act, as in FEMA, an appeal lies from an interlocutory
order and this has been made clear in Section 20(1) of the Act.
referring to the aforesaid schemes under different Statutes, this Court wants
to underline that the right of appeal, being always a creature of a Statute,
its nature, ambit and width has to be determined from the Statute itself. When
the language of the Statute regarding the nature of the order from which right
of appeal has been conferred is clear, no statutory interpretation is warranted
either to widen or restrict the same.
argument that writ jurisdiction of the High Court under Article 226 of the
Constitution is a basic feature of the Constitution and cannot be ousted by
Parliamentary legislation is far too fundamental to be questioned especially
after the judgment of the Constitution Bench of this Court in L. Chandra Kumar
vs. Union of India and others - [(1997) 3 SCC 261]. However, that does not
answer the question of maintainability of a writ petition which seeks to impugn
an order declining dispensation of pre-deposit of penalty by the Appellate
a statutory forum is created by law for redressal of grievance and that too in
a fiscal Statute, a writ petition should not be entertained ignoring the
statutory dispensation. In this case High Court is a statutory forum of appeal
on a question of law. That should not be abdicated and given a go bye by a
litigant for invoking the forum of judicial review of the High Court under writ
jurisdiction. The High Court, with great respect, fell into a manifest error by
not appreciating the aspect of the matter. It has however dismissed the writ
petition on the ground of lack of territorial jurisdiction.
reason could be assigned by the appellant's counsel to demonstrate why the
appellate jurisdiction of the High Court under Section 35 of FEMA does not
provide an efficacious remedy. In fact there could hardly be any reason since
High Court itself is the appellate forum.
Reference may be made to the Constitution Bench decision of this Court rendered
in Thansingh Nathmal and others vs. The Superintendent of Taxes, 16 Dhubri,
reported in AIR 1964 SC 1419, which was also a decision in a fiscal law.
Commenting on the exercise of wide jurisdiction of the High Court under Article
226, subject to self imposed limitation, this Court went on to explain:
High Court does not therefore act as a court of appeal against the decision of
a court or tribunal, to correct errors of fact, and does not by assuming
jurisdiction under Article 226 trench upon an alternative remedy provided by
statute for obtaining relief. Where it is open to the aggrieved petitioner to
move another tribunal, or even itself in another jurisdiction for obtaining
redress in the manner provided by a statute, the High Court normally will not permit
by entertaining a petition under Article 226 of the Constitution the machinery
created under the statute to be bypassed, and will leave the party applying to
it to seek resort to the machinery so set up."
decision in Thansingh (supra) is still holding the field.
in Titaghur Paper Mills Co. Ltd. and another vs. State of Orissa and another
[AIR 1983 SC 603] in the background of taxation laws, a three judge Bench of
this Court apart from reiterating the principle of exercise of writ
jurisdiction with the 17 time-honoured self imposed limitations, focused on
another legal principle on right and remedies. In paragraph 11, at page 607 of
the report, this Court laid down:
is now well recognized that where a right or liability is created by a statute
which gives a special remedy for enforcing it, the remedy provided by that
statute only must be availed of. This rule was stated with great clarity by
Willes, J. in Wolverhampton New Water Works Co. v. Hawkesford  6 C.B (NS)
336 at page 356 in the following passage:
are three classes of cases in which a liability may be established founded upon
statute.... But there is a third class, viz., where a liability not existing at
common law is created by a statute which at the same time gives a special and
particular remedy for enforcing it...the remedy provided by the statute must be
followed, and it is not competent to the party to pursue the course applicable
to cases of the second class. The form given by the statute must be adopted and
adhered to." The rule laid down in this passage was approved by the House
of Lords in Neville v. London Express Newspaper Ltd.  AC 368 and has been
reaffirmed by the Privy Council in Attorney-General of Trinidad and Tobago v. Gordon
Grant and Co.  AC 532 and Secretary of State v. Mask and Co. AIR 1940 PC
105. It has also been held to be equally applicable to enforcement of rights,
and has been followed by this Court throughout. The High Court was therefore
justified in dismissing the writ petitions in limine".
this case, liability of the appellant is not created under any common law
principle but, it is clearly a statutory liability and for which the statutory
remedy is an appeal under Section 35 of FEMA, subject to the limitations
petition in the facts of this case is therefore clearly not maintainable. Again
another Constitution Bench of this Court in Mafatlal Industries Ltd. and others
vs. Union of India and other [(1997) 5 SCC 536], speaking through Justice B.P.
Jeevan Reddy, delivering the majority judgment, and dealing with a case of
refund of Central Excise Duty held:
far as the jurisdiction of the High Court under Article 226 -- or for that
matter, the jurisdiction of this Court under Article 32 -- is concerned, it is
obvious that the provisions of the Act cannot bar and curtail these remedies.
It is, however, equally obvious that while exercising the power under Article
226/Article 32, the Court would certainly take note of the legislative intent
manifested in the provisions of the Act and would exercise their jurisdiction
consistent with the provisions of the enactment" (para 77 page 607 of the
concluding portion of the judgment it was further held:
"The power under Article 226 is conceived to serve the ends of law and not
to transgress them" [Para 108 (x), p. 635].
view of such consistent opinion of this Court over several decades we are
constrained to hold that even if High Court had territorial jurisdiction it
should not have entertained a writ petition which impugns an order of the
Tribunal when such an order on a question of law, is appealable before the High
Court under Section 35 of FEMA.
Learned counsel for the respondents relied on a judgment of this Court in Seth
Chand Ratan vs.
Durga Prasad (D) By Lrs. and Ors. - (2003) 5 SCC 399. Learned counsel relied on
paragraph (13) of the said judgment which, inter alia, lays down the principle,
namely, when a right or liability is created by a Statute, which itself
prescribes the remedy or procedure for enforcing the right or liability, resort
must be had to that particular statutory remedy before seeking the
discretionary remedy under Article 226 of the Constitution.
the aforesaid principle is subject to one exception, namely, where there is a
complete lack 20 of jurisdiction of the tribunal to take action or there has
been a violation of rules of natural justice or where the tribunal acted under
a provision of law which is declared ultra vires. In such cases,
notwithstanding the existence of such a tribunal, the High Court can exercise
its jurisdiction to grant relief.
the instant case none of the aforesaid situations are present.
Therefore, principle laid down in the Ratan's case (supra) applies in the facts
and circumstances of this case. If the appellant in this case is allowed to
file a writ petition despite the existence of an efficacious remedy by way of
appeal under Section 35 of FEMA this will enable him to defeat the provisions
of the Statute which may provide for certain conditions for filing the appeal,
like limitation, payment of court fees or deposit of some amount of penalty or
fulfillment of some other conditions for entertaining the appeal. (See para 13
at page 408 of the report). It is obvious that a writ court should not
encourage the aforesaid trend of by-passing a statutory provision.
Learned counsel for the appellant relied on a decision of this Court in
Monotosh Saha vs. Special Director, Enforcement Directorate and Anr. - (2008)
12 SCC 359. That was a decision entirely on different facts. In that decision
Saha preferred an appeal before the appellate tribunal with a request for
dispensing with requirement of pre-deposit, but the tribunal directed the
deposit of 60% of the penalty amount before entertaining the appeal. When an
appeal was preferred before the High Court under Section 35 of the FEMA, the
same was dismissed by the High Court holding that no case for hardship was made
out either before the tribunal or before it. In the background of those facts,
this Court observed that since pursuant to this Court's interim order Rs.10
lacs have been deposited with the Directorate, the appellant was directed to
furnish further such security as may be stipulated by the tribunal and directed
that on such deposit tribunal is to hear the appeal without requiring further
46. It is
obvious from the aforesaid discussion that in Monotosh Saha (supra) proper
procedure was followed 22 by filing an appeal under Section 35. On that this
Court made certain observations. The said decision is, therefore, not relevant
to the facts and circumstances of the case in hand.
Learned counsel for the appellant also relied on a decision of this Court in
Kusum Ingots and Alloys Ltd. vs. Union of India and Anr. - (2004) 6 SCC 254.
That was a decision on the question of "part of the cause of action"
under Article 226 (2) of the Constitution. Since this Court is of the opinion
that the writ petition itself is not maintainable for the reasons discussed
above, the question of part of cause of action is not relevant. So the
aforesaid decision is not attracted to the points in issue in this case.
decision in Ambica Industries (supra) is also on the question of part of cause
of action under Article 226 (2) of the Constitution of India. For the aforesaid
reasons, the decision in Ambica Industries (supra) is not of much relevance in
the facts of the case in hand.
the reasons discussed above, this Court is of the opinion a writ petition is
not ordinarily maintainable to challenge an order of the Tribunal.
therefore, dismiss the appeal, of course for reasons which are different from
the ones given by the High Court in dismissing the writ petition.
view of this Court's jurisdiction under Article 136 of the Constitution, we
give liberty to the appellant, if so advised, to file an appeal before an
appropriate High Court within the meaning of Explanation to Section 35 of FEMA
and if such an appeal is filed within a period of thirty days from today, the
appellate forum will consider the question of limitation sympathetically having
regard to the provision of Section 14 of the Limitation Act and also having
regard to the fact that the appellant was bona-fide pursuing his case under
Article 226 of the Constitution before the Delhi High Court and then its appeal
before this Court.
51.With the aforesaid direction, the appeal is dismissed. The parties are left
to bear their own costs.
.....................J. (G.S. SINGHVI)