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Judgment
The prayer in the writ petition is as follows :
... to issue a writ of prohibition or any other appropriate writ, order or direction in the nature of a writ, restraining the respondent No. 1 from
proceeding with the adjudication of the case arising out of the show cause notice No. C. No. V/24/15/118/89 CX. ADJ dated 6-12-1989
(Annexure ''F'') issued by the first respondent without first summoning and without giving adequate opportunity to cross-examine the persons as
requested by the petitioners in their letters dated 21-1-1991 and 25-3-1991 and pass such further or other orders...
The short point that arises for consideration in this writ petition is, whether, on the facts and circumstances of the case, a writ of prohibition
could issue.
The brief facts are :
The first petitioner Company carries on business of manufacturing and dealing in cigarettes and the second petitioner is one of the share-holders of
the first petitioner Company. It is alleged in the affidavit filed in support of the writ petition that the said factory of the petitioner company was set
up in 1987 and the production of cigarettes in the said factory commenced in February 1987, that the first petitioner company has been duly
complying with all the laws and rules relating to the Central Excise in respect of the operation of the said factory and that on an average the first
petitioner Company pays an amount of Rs. 1.2 crores per month on account of duties of Central Excise to the Central Government, under the
Central Excise Act, 1944. It is further alleged that the Superintendent of Central Excise and four Inspectors of Central Excise Department are
permanently posted in the said factory, that the factory operates in three shifts and that during all the three shifts at least one officer of the Central
Excise Department used to be present in the factory and maintain a watch and check on the various operations in the said factor. The main raw
materials required for the manufacture of cigarettes are processed Cut Tobacco and that as the first petitioner Company does not have facilities for
cutting and processing the tobacco, the first petitioner purchases raw tobacco from the market and sends the same to M/s. Deccan Tobacco
Processors Limited, Hyderabad, for the purpose of cutting and processing and the said M/s. Deccan Tobacco Processors Ltd., in accordance
with the specifications and requirements of the first petitioner cuts and processes the said tobacco and supplies the duty paid processed Cut
Tobacco to the first petitioner at its factory at Salem. It seems that before receiving any Cut Tobacco in the said factory, the first petitioner has to
give an intimation to the officers of the Central Excise Department posted in the said factory in Form D-3 prescribed by the Central Excise Rules,
1944. As soon as the cut tobacco is received in the store room of the first petitioner Company, entries are made in the relevant statutory records
viz., a register maintained in Form RG-16 (formerly in Form E.B. 3). It is alleged in the affidavit that the first petitioner maintains records according
to the staute relating to the production of cigarettes viz., a register in Form Appendix C. 1 prescribed for it. So also, a register in Form Appendix
D-1 is maintained in respect of packing of cigarettes. In respect of cigarettes stored in the bonded store room, a register in Form RG-1 is kept and
the said register is checked by the officers of the Central Excise Department on a day to day basis. It is also stated in the affidavit that no cigarettes
can be removed from the bonded store room without the permission of the Central Excise Department and before removing any cigarettes, the first
petitioner Company has to apply in writing for permission to the respondents in Form AR-1 and thereafter gate passes in Form GP-1 are given. It
is also alleged that with regard to the rejected cigarettes, a record is maintained which is called Form ""E-1"". It is further alleged that in June 1988,
the then Collector of Central Excise, Coimbatore, visited the factory of the first petitioner in Salem and found that storage and other losses were
taking place in Cut Tobacco, Winnowing, ripped tobacco, Tobacco dust and floor sweeping and one K. V. Baby, the Superintendent of Central
Excise (Technical) was deputed to visit the factory and conduct an investigation into the said losses and the said K. V. Baby visited the factory at
Salem and made various investigations relating to the said losses and submitted a report to the then Collector. The first petitioner was not furnished
with a copy of the said report. The first petitioner was issued with a show cause notice dated 6-12-1989 and according to the petitioners, the main
charges in the show cause note are as follows :
a(i) On a verification of stock conducted on 24-6-1989 certain shortages were found in the stock of Cut Tobacco, Winnowings, Ripped
Tobacco and Tobacco Dust.
(ii) On the basis of the said allegation the Company has been charged for improperly accounting Cut Tobacco as Winnowings, Ripped Tobacco,
Dust and Floor Sweepings and for having clandestinely manufactured and removed without payment of duty a total quantity of 24.94 million
cigarettes.
(iii) The above charge is also sought to be supported by certain figures relating to consumption of shells and slides (in which cigarettes are packed).
b(i) Certain cigarettes sold to Suvarna Filter and Tobacco Products Ltd., Salem were not covered by any Gate Pass.
(ii) On the basis of the said allegation the Company has been charged for having clandestinely removed a total quantity of 46.80 million cigarettes.
It is alleged in the affidavit that one of the main issues that has been raised in the notice is that the losses recorded in the statutory registers of the
Company are abnormal and not correct and that the charges made in the notice are wholly misconceived and untenable. It seems that the first
petitioner filed a reply dated 12-4-1990 to the notice and followed up by several replies dated 25-6-1990, 25-7-1990 and 28-9-1990 and
thereafter filed a consolidated reply dated 7-10-1990. It is also alleged that by a letter dated 21-1-1991 the first petitioner requested the 1st
respondent to make available for cross-examination four persons mentioned in the said letter. This request was repeated by the first petitioner by a
letter dated 11-3-1991. By another letter dated 25-3-1991, the first petitioner again repeated its request for the cross-examination of the four
persons mentioned in its letters dated 21-1-1991 and 11-3-1991 and in addition to those four persons, the first petitioner wanted to cross-
examine five more persons who were all Inspectors of Central Excise posted in the factory at Salem at different times during the relevant period. It
is submitted that the evidence of the said persons is relevant and material to all the issues arising in the notice.
It is alleged in the affidavit that on 25-3-1991, a personal hearing took place before the first respondent with regard to the show cause notice
and that in the course of the said hearing the first respondent was willing to accept the request of the first petitioner for cross-examination but he
wanted to know within 15 days from 25-3-1991 the scope of the broad topics which would be covered by cross-examination. By a letter dated
8-4-1991, the first petitioner furnished the first respondent the list of the broad topics which would cover the scope of cross-examination by the
first petitioner. Subsequently by a telegram dated 6-5-1991 the first petitioner requested the 1st respondent to let the first petitioner know as to
which of the persons requested by the first petitioner have been summoned for cross-examination in the next hearing so as to enable the first
petitioner to make necessary preparations.
It is alleged that the next hearing took place before the 1st respondent on 18-7-1991 and in the course of the said hearing the 1st respondent has
arbitrarily and capriciously refused to summon any of the persons as requested by the first petitioner and permit the cross-examination of those
persons, and the first petitioner submitted before the first respondent that the case of the first petitioner would be severely prejudiced and
handicapped by the absence of the evidence of the persons whose cross-examination was requested by the first petitioner and that no useful
purpose would be served by proceeding in the matter without such evidence. Thereupon, the first respondent closed the proceedings and informed
the first petitioner that the first respondent would proceed to make his final order in the matter. After the said hearing, a letter dated 19-7-1991
was addressed to the first respondent, which is marked as Annexure ""M"". The petitioners allege that on the facts and circumstances of the case,
the first respondent is proceeding with the adjudication of the case arising out of the notice in grave and flagrant violation of the principles of natural
justice especially when the first petitioner wanted to cross-examine the persons whose evidence, according to the petitioners, is relevant and
material, and without such evidence, the matter cannot be adjudicated fairly and properly and the first respondent has prejudged the issue on
extraneous and irrelevant consideration and has decided to pass the final order. It is alleged in the affidavit that when the first respondent, during
the course of hearing on 25-3-1991, agreed to allow cross-examination and directed the first petitioner to furnish the broad topics on which the
proposed cross-examination was to take place within 15 days, at the time of hearing on 11-8-1991, the first respondent refused to do so and
stated that he had decided to disallow the request of the first petitioner for cross-examination. It is also alleged in the affidavit that when the first
petitioner demanded that the first respondent should make an order on the above questions and realising that if he were to make an order, the
petitioners would approach the High Court, the first respondent refused to make an order and stated that he would dispose of the petitioners''
request only in his final adjudication order, and thereupon the first respondent asked the first petitioner to argue on merits which the first petitioner
refused to do in view of the refusal of the first respondent to allow cross-examination as such refusal at this stage only indicated that the first
respondent had already prejudged the issue and the hearing was only a farce. It is stated in paragraph 19 of the affidavit that the first petitioner
declined to participate in the proceedings which were wholly without jurisdiction and the result of which would have been a nullity. It is also stated
that the first respondent reserved the case for passing final orders. The petitioners justify in paragraphs 19(A) to (B) of the affidavit filed in support
of the writ petition how the examination of the witnesses is necessary which is not necessary to report. It is also alleged in the affidavit that by
refusing to summon the persons as listed by the first petitioner and permit the first petitioner to cross-examine the said persons, there is a violation
of the principals of natural justice. The first respondent''s refusal to summon the witnesses is arbitrary and capricious. It is categorically stated that
on the hearing date on 25-3-1991, the first respondent agreed to accept the request of the first petitioner for cross-examination and had directed
the first petitioner to furnish a list of broad topics covering the scope of the cross-examination and the first petitioner also duly furnished such a list
to the first respondent but without giving any reason whatsoever, the first respondent rejected the request of the first petitioner for cross-
examination. It is stated that the first respondent is intending to proceed in the matter by ignoring and shutting out relevant evidence and material
and has prejudged the notice on the basis of extraneous and irrelevant considerations and it is in grave and flagrant violation of the principles of
natural justice and such proceedings constitute an unreasonable restriction on the rights of the petitioners to carry on business and to hold property
and such proceedings violate the rights of the petitioners under Articles 14, 19 and 300A of the Constitution of India. In paragraph 20 of the
affidavit filed in support of the writ petition it is stated that on 18-7-1991, when the hearing was held, the first respondent disallowed the first
petitioner''s request to summon and cross-examine the persons named by the first petitioner, the first petitioner had to tell the first respondent that
no useful purpose would be served by proceeding further in the matter and thereupon the first respondent closed the proceedings and informed the
first petitioner that he would proceed to pass final orders in the matter. The first petitioner would submit that if the first respondent proceeds to
pass final order, great hardship and irreparable damage would cause to the first petitioner, and the first petitioner would be compelled to meet an
exhorbitant demand of more than Rs. 1.34 crores. With the above allegations, the writ petitioners have come to this Court for the issue of a writ of
prohibition.
An additional affidavit has been filed before me pointing out that a scheme was announced on 30-3-1985 by the Government of India for the
grant of rewards to informers and government servants including the adjudicating authorities (hereinafter referred to as the ""Reward Scheme"") and
that the said reward scheme contemplates a payment of advance reward upto 25% of the expected final reward immediately after the issuance of
the show cause notice itself. The petitioners apprehend that the undue haste and hurry shown by the first respondent viz., the Collector of Central
Excise, Coimbatore in closing the hearing and going back on his earlier decision allowing the petitioner''s request for cross-examination has been
greatly influenced by the said reward scheme. It is stated that the said reward scheme also vitiates the present proceedings on the ground of both
pecuniary and institutional bias; the institutional bias arises from the fact that the entirety of the officers and staff of the Excise Department are also
entitled to the huge amount of reward and that the validity of the reward scheme has been challenged by a writ petition filed under Article 32 of the
Constitution of India before the Supreme Court in the matter of Dunkan Agro Industries v. Union of India (CWP No. 443 of 1989) and the
Supreme Court has passed interim orders restraining the Union of India in respect of the said reward scheme. Yet another additional affidavit has
been filed by the petitioners stating that it would be a mandatory duty on the part of the first respondent to permit such cross-examination in order
to comply with the principles of natural justice and praying for a writ of mandamus directing the first respondent to summon and cross-examine the
persons as requested by the petitioners in their letters dated 21-1-1991 and 25-3-1991.
I heard the arguments of Mr. K. K. Venugopal, learned senior counsel appearing for the petitioners in extenso.
Mr. K. K. Venugopal, learned senior counsel, refers to various documents especially Annexure K, L and M and points out that in spite of the
request of the petitioners for cross-examination of the persons named by the petitioners, the first respondent has proceeded with the adjudication
rejecting the request of the petitioners and contends that once the first respondent has accepted the request of the petitioners for cross-examination
in the course of the hearing on 25-3-1991 and wanted a list of the broad topics which would be covered by cross-examination but, however,
subsequently the first respondent rejected the request of the petitioners during the next hearing. This, according to the learned senior counsel, is an
arbitrary decision on the part of the first respondent and if the first respondent passes an order or proceeds with the adjudication without cross-
examining the witnesses named by the petitioners, it will be a violation of the principles of natural justice. The learned senior counsel further
contends that the petitioners have got a right to examine the witnesses and the first respondent ought to have informed the petitioners whether the
first respondent proposes to allow the petitioners to cross-examine the witnesses or not. It is stated that the petitioners should have been informed
about the decision earlier and the first respondent has erred in not allowing the petitioners to cross-examine the witnesses on the hearing on 18-7-
1991 and as such, the first respondent has failed to observe the principles of natural justice and in view of the facts and circumstances of the case,
a writ of prohibition could issue.
7A. When I asked the learned senior counsel appearing for the petitioners whether the proceedings are over, the answer is in the affirmative. It has
been stated in the affidavit itself that since the petitioners were refused to cross-examine the witnesses, they refused to partake in the proceedings
on 18-7-1991 as there would not be any point in arguing the matter without cross-examining the witnesses. As such the learned senior counsel
states that as matter stands today, the first respondent has reserved the orders on the adjudication proceedings. However, the learned senior
counsel says that without allowing the petitioners to lead the necessary evidence which, according to the petitioners, is very important for deciding
the vital issues in the adjudication proceedings, the conduct of the first respondent in reserving the orders on the adjudication proceedings is in
violation of the principles of natural justice.
The learned senior Counsel relies upon a decision of a Division Bench of this Court in ILR 1964 Mad 700 and the judgment of the Supreme
Court in Govinda Menon Vs. Union of India (UOI), for the proposition that when there is violation of principles of natural justice, a writ of
prohibition shall issue. The learned senior counsel points out that the first respondent will pass an order without giving an opportunity to the
petitioners to cross-examine the witnesses and submits that if an order is passed without observing the principles of natural justice it is a nullity. The
learned senior counsel also relies upon a decision reported in Nawabkhan Abbaskhan Vs. The State of Gujarat, for the proposition that an order
passed in violation of the principles of natural justice is a nullity and refers to Halsbury''s Laws of England, Fourth Edition, Vol. 1, paragraph 128 at
page 137 and contends that this is a fit case where a writ of prohibition should be issued considering the facts of the case where the first
respondent has reserved the orders in violation of the principles of natural justice.
I have considered the arguments of Mr. K. K. Venugopal, learned senior counsel appearing for the petitioners and also gone through the
affidavit, additional affidavits and various typed sets filed in this case including the show cause notice and the various letters written by the
petitioners to the first respondent. After giving my serious consideration over the matter, I am of the view that a writ of prohibition shall not lie on
the facts and circumstances of this case. First of all, this is a case where, according to the affidavit, the petitioners themselves refused to argue the
case on merits without cross-examining the list of witnesses given by them. Apart from that, it is clear from the affidavit that orders have been
reserved by the first respondent. When the proceedings have come to an end before the first respondent and orders alone have to be pronounced,
I am of the view that this Court cannot re-open the proceedings by any method by issuing any writ, more so, when the petitioners are seeking for a
writ of prohibition in this case. There cannot be any doubt about the proposition of law that an order which infringes a fundamental right passed in
violation of the audi alteram partem rule is a nullity and it has been so held in the decision reported in Nawabkhan Abbaskhan Vs. The State of
Gujarat, . But at the same time it has got to be remembered that the application of the principles of natural justice depends upon the facts and
circumstances of each case. It has been held by the Supreme Court in K.L. Tripathi Vs. State Bank of India and Others, that in quasi-judicial
adjudications, neither cross-examination nor the opportunity to lead evidence by the delinquent is an integral part of the proceedings. It has also
been held therein that the rules of natural justice are flexible and cannot be put on any rigid formula. The Supreme Court further observed at page
284, paragraph 41 as under :
It is true that all actions against a party which involve penal or adverse consequences must be in accordance with the principles of natural justice
but whether any particular principle of natural justice would be applicable to a particular situation or the question whether there has been any
infraction of the application of that principle has to be judged in the light of facts and circumstances of each particular case. The basic requirement
is that there must be fair play in action and the decision must be arrived at in a just and objective manner with regard to the relevance of the
materials and reasons. We must reiterate again that the rules of natural justice are flexible and cannot be put on any rigid formula. In order to
sustain a complaint of violation of principles of natural justice on the ground of absence of opportunity of cross-examination it has to be established
that prejudice has been caused to the appellant by the procedure followed. See in this connection the observations of this Court in the case of
Jankinath Sarangi Vs. State of Orissa, . Hidayatullah, C.J., observed there at page 394 of the report ""there is no doubt that if the principles of
natural justice are violated and there is a gross case this Court would interfere by striking down the order of dismissal, but there are cases and
cases. We have (sic) to look to what actual prejudice has been caused to a person by the supposed denial to him of a particular right.
So it cannot be put as a wide proposition that whenever cross-examination has been refused, it will be a violation of the principles of natural
justice. In my view, on the facts and circumstances of this case, this Court cannot presume that the first respondent is going to pass an adverse
order on the basis of the show cause notice and the explanation given by the petitioners. Though the learned senior counsel foresees, that there will
be an adjudication against the petitioners, just for that, this Court cannot presume so. Apart from that, in my view, a writ of prohibition should not
be issued in such a case where the adjudication proceedings is over and this Court should not interdict with the proceedings. The case referred to
by the learned senior counsel reported in Govinda Menon Vs. Union of India (UOI), deals with the principles for the issue of a writ of prohibition.
In that case, the Supreme Court was concerned with a writ petition filed by a member of the Indian Administrative Service against certain
disciplinary proceedings taken against him. The Supreme Court affirmed the judgment of the Kerala High Court in Srikandath Govinda Menon Vs.
Union of India (UOI) and Another, . In that case, the Supreme Court was considering the jurisdiction of this Court under Article 226 of the
Constitution of India for the grant of a writ of prohibition. While considering the question at page 1277, the Supreme Court held as follows :
(5) The jurisdiction for grant of a writ of prohibition is primarily supervisory and the object of that writ is to restrain Courts or inferior tribunals
from exercising a jurisdiction which they do not possess at all or else to prevent them from exceeding the limits of their jurisdiction. In other words,
the object is to confine Courts or Tribunals of inferior or limited jurisdiction within their bounds. It is well settled that the writ of prohibition lies not
only for excess of jurisdiction or for absence of jurisdiction but the writ also lies in a case of departure from the rules of natural justice (See
Halsbury''s Laws of England, 3rd Edn. Vol. 11, p. 114). It was held for instance by the Court of Appeal in The King v. North 1927 1 KB 491
that as the order of the Judge of the consistory Court of July 24, 1925 was made without giving the vicar an opportunity of being heard in his
defence, the order was made in violation of the principles of natural justice and was, therefore, an order made without jurisdiction and the writ of
prohibition ought to issue. But the writ does not lie to correct the course, practice or procedure of an inferior tribunal, or a wrong decision on the
merits of the proceedings. It is also well established that a writ of prohibition cannot be issued to a Court or an inferior tribunal for an error of law
unless the error makes it go outside its jurisdiction. (See Regina v. Controller-General of Patents and Design, 1953 2 WLR 760 and Parisienne
Basket Shoes Proprietary Ltd. v. Whyte, 59 CIR 369. A clear distinction must, therefore, be maintained between want of jurisdication and the
manner in which it is exercised. If there is want of jurisdiction then the matter is coram non judice and a writ of prohibition will lie to the Court or
inferior tribunal forbidding it to continue proceedings therein in excess of its jurisdiction.
Apart from that, in that case, a question was raised about the jurisdiction to continue the disciplinary proceedings and whether the disciplinary
proceedings were rightly instituted under Rule 4(1)(b) of the All India Services (Discipline and Appeal) Rules 1955. In that case, the Supreme
Court was not concerned with the proposition with regard to the cross-examination of witnesses in adjudication proceedings. In S.T. Adityan and
Others v. The First Income Tax Officer, City Circle IV, Madras. 10 (ILR 1964 Mad 700 1964 II MLJ 113, A Division Bench of this Court was
considering a batch of writ petitions filed by a daily newspaper from proceeding further with the enquiry commenced u/s 34 of the Indian Income
Tax Act for certain assessment years. The Division Bench at page 119 observed as follows :
The scope of a writ of prohibition is fairly clear. A writ of prohibition is an instrument of judicial control to prevent an excess or abuse of
jurisdiction by inferior tribunals. Where a tribunal assumes or threatens to assume a jurisdiction which it does not possess prohibition may issue so
long as the proceedings are not complete. Prohibition also lies for a departure from rules of natural justice. If the presiding officer of the inferior
tribunal is interested in the lis, or is otherwise biassed he can be restrained by prohibition from acting further in the matter. It is, however, well
settled that prohibition will not lie to correct an error of law, or a mere irregularity of procedure, or a wrong decision on the merits of proceedings
unless there is an excess of jurisdiction. Sometimes scope of writ of prohibition and certiorari, overlap. In one action the applicant may seek to
quash an order and restrain an imminent transgression of jurisdiction. But, the scope of prohibition is narrower than that of certiorari. While
certiorari may go to correct a manifest error of law on the face of the record even if the tribunal had acted within its jurisdiction, prohibition cannot
prevent a threatened irregularity or illegality by the tribunal within its ostensible jurisdiction. ""No jurisdictional fault, no prohibition"", would not
merely be a good working rule in the administration of writs, but would be a succinct and correct statement of the nature and function of a writ of
prohibition. Ferris in his Book on the LAW OF EXTRAORDINARY LEGAL REMEDIES observes thus :
It is well settled that a writ of prohibition may not be used to usurp or perform the functions of an appeal, writ of error or certiorari, or to correct
any mistakes, errors or irregularities in deciding any question of low or fact within its jurisdiction. The office of the writ.... is to prevent an unlawful
assumption of jurisdiction, not to correct mere errors and irregularities in matters over which the Court has cognizance.... Where there is authority
to do the act, but the manner of doing it, is improper, the writ will not lie. In other words, whatever power is conferred may be exercised, and, if it
be exercised injudiciously, erroneously and irregularly, it amounts to error merely and not to a usurpation or excess of jurisdiction. In such a case,
however gross the error, irregularity or mistake, the writ does not lie, not because, as is sometimes erroneously stated, there exist other adequate
remedies, or such remedies are inhibited, but for the reason that there has been no usurpation or abuse of power (page 439).
I do not think that factually this case is relevant to the case on hand. In East India Commercial Co. Ltd.,Calcutta and Another Vs. The Collector of
Customs, Calcutta, . The Supreme Court while considering the question of notice issued under Imports and Exports (Control) Act, 1947 observed
as follows at page 1903, paragraph 26 :-
(26) The first question is whether the petition filed by the appellants under Art. 226 of the Constitution for the issue of a writ in the nature of
prohibition is maintainable in the circumstances of the case. A writ of prohibition is an order directed to an inferior Tribunal forbidding if from
continuing with a proceeding therein on the ground that the proceeding is without or in excess of jurisdiction or contrary to the laws of the land,
statutory or otherwise, Mackonochie v. Lord Penzance, 1881 AC 424 and Halsbury''s Laws of England, Vol. 2, 3rd Edn.
Here also, it is a question of jurisdiction and it was held that the Customs Authorities have no jurisdiction to proceed u/s 167 of the Sea Customs
Act. In Y. Narayana Chetty and Another v. The Income Tax Officer, Nellore and Others AIR 1959 S.C. 213 it has been held that a writ of
prohibition cannot be issued since the contention raised by the petitioners do not raise any question of jurisdiction. The Supreme Court further
observed as follows (at page 219, paragraph 12) :
... All that the appellants would be able to argue on this ground would be that the course adopted by the Income Tax Officer in making orders of
fresh assessment is irregular and illogical and should be corrected. That is a matter concerning the merits of the orders of assessment and by no
stretch of imagination can it be said to raise any question of jurisdiction under Art. 226.
A single Judge of this Court in the decision reported in P.S. Subramaniam Chettiar v. The Joint Commercial Tax Officer III, Dindigul (1972) 30
S.T.C. 243 has held that a writ of prohibition is not issued as of right or as a matter of course. But it can only issue if the petitioner establishes to
the satisfaction of a well instructed mind that a public duty is sought to be neglected or an open action is being undertaken in violation of public law.
In my view, in the instant case, the circumstances do not warrant the issue of a writ of prohibition as the facts do not disclose that the list of persons
given by the petitioners have got to be cross-examined necessarily for the purpose of adjudication as the adjudicating authority thought so. In Taj
Mahal Transports (P) Ltd., Melapalayam, Tirunelveli Vs. Secretary, Regional Transport Authority, Tirunelveli and Another, , a Division Bench of
this Court had an occasion to consider the scope of issuing a writ of prohibition in a case which arose under the Motor Vehicles Act and traced the
history of the writ of prohibition in England at page 11, paragraph 10. Having traced the history, the Division Bench held in paragraph 11 as under :
(11). We have referred to these principles little extensively, for an important reason. The corpus of Administrative law is growing apace, and
every day, many quasi-judicial and statutory tribunals, which are subject to the jurisdiction of this court under Art. 226 of the Constitution, have to
function and dispose of multiple proceedings before them, in many of these proceedings it is conceivable that, inter alia, a contention relating to
excess of jurisdiction, involved in the grant of the relief sought for by a party, may be raised. If, in each one of these cases, a party, who might be
affected by such a possible decision, can be permitted to come up to this court and ask for prohibition to go, though it might be perfectly probable
that the inferior Tribunal would have jurisdiction, upon facts being established in a particular way, this would really imply that many proceedings
quite within the competence of such authorities, or which may be ultimately found to be comprised in the jurisdiction, may be stifled at the outset.
We do not think that that would be the proper province of the exercise of the power of this court to issue this writ under Art. 226 of the
Constitution....
Again, a learned single Judge of this Court in an unreported decision in Paramakudi Bus Transports (P) Ltd., Paramakudi v. The Regional
Transport Authority, Tamanathapuram at Madurai and Others (W.P. Nos. 764 and 765 of 1966 dated 20-7-1966) considered the decisions in
N.T. Veluswami Thevar Vs. G. Raja Nainar and Others, and Thansingh Nathmal and Others Vs. A. Mazid, Superintendent of Taxes, and Taj
Mahal Transports (P) Ltd., Melapalayam, Tirunelveli Vs. Secretary, Regional Transport Authority, Tirunelveli and Another, and held that a writ of
prohibition should not be issued. In Seervai''s Constitutional Law of India, Third Edition, Vol. II, regarding ""Right to Judicial Remedies, at page
1225, paragraph 16.80, the scope of writ of prohibition has been considered. At page 1119 in paragraph 16.467, it is stated that if the
proceedings of the Tribunal have been terminated, it is too late to issue a writ of prohibition and the proper remedy is the writ of certiorari to quash
the decision. The leading English decision on prohibition is Farquharson v. Morgan (1894) 1 Q.B. 552 and it has been repeatedly followed in
India. Actually, this has been discussed clearly at length in the case Govinda Menon Vs. Union of India (UOI), referred to earlier. In Halsbury''s
Laws of England, 4th Edition, Vol. 1 in paragraph 128, the scope of writ of prohibition is discussed. In paragraph 130 it is stated that one of the
grounds for the issue of a writ of prohibition is that the writ of prohibition lies not only for excess of or absence of jurisdiction, but also for a
departure from the rules of natural justice and it does not, however, lie to correct the course, practice or procedure of an inferior tribunal, or a
wrong decision on the merits of proceedings. As I have already stated, here is a case where it is to be seen whether the principles of natural justice
as observed in K.L. Tripathi Vs. State Bank of India and Others, and extracted supra already, have been violated. As such, I am not satisfied that,
on the facts and circumstances of the case on hand, a writ of prohibition could issue, especially when the orders have been reserved by the first
respondent and the petitioners refused to take part in the proceedings and argue the case on metits. The Petitioners should have argued the case on
merits and taken the ground of non-examination of the witnesses listed by them before the first respondent itself. Without doing so, I do no think
that it is proper on the part of the petitioners to come before this Court and ask for the issuance of a writ of prohibition.
The learned senior counsel referred to me certain unreported decisions of the Bombay High Court especially in G.T.C. Industries Ltd. Vs.
Union of India, and also the various orders of the Bombay High Court following the same judgment. On a reading of those judgments of the
Bombay High Court, it is clear that the writ petition i.e., W.P. No. 1572 of 1991 was filed against the final order asking the petitioner to pay the
excess duty and penalty and that order was challenged on the ground that the principles of natural justice have been violated. I do not see how
these unreported judgments in W.P. No. 1572 of 1991 and W.P. No. 2019 of 1991 etc., will have any relevance to the present case. Here is a
case where the order has not been passed. As such the unreported judgments of the Bombay High Court are clearly distinguishable both on facts
and law. Having regard to the decisions referred to above and the position of law with regard to the issue of a writ of prohibition, I am fully
satisfied that this not a case where a writ of prohibition should be issued at this stage of the proceedings.
That apart, Chapter VI-A of the Central Excises and Salt Act, 1944, as it stands to-day, provides for statutory appeals against any order
passed. Section 35B provides for an appeal to the Appellate Tribunal. Section 35F provides for the deposit of duty demanded or penalty levied
pending appeal and the proviso to this section enables the appellate authority to consider the case and empowers the appellate authority to
dispense with such deposit subject to such conditions as he or it may deem fit to impose so as to safeguard the interest of revenue. Section 35G
provides for drawing up a statement of case for reference by the Appellate Tribunal to the High Court. Section 35L provides for further appeal to
the Supreme Court. It has been repeatedly held even in cases where orders are passed that the Court should desist from interfering with the
assessment when the assessee has an adequate alternative remedy. It is true it is not based on rule of law but as a matter of practice and discretion.
It has been so held by this Court in C.N. Paper Industries Madras Vs. Collector of Central Excise and Others, . The Supreme Court in Titaghur
Paper Mills Co. Ltd. and Another Vs. State of Orissa and Others, has clearly held that a writ petition under Art. 226 is not maintainable when the
petitioner has efficacious remedy by way of appeal and second appeal as well as the Tax Appeal in the State of Orissa. That was a case where
assessment orders were challenged and writ petitions for the issue of writ of certiorari were filed. The contention raised before the High Court was
that the impugned order of assessment being a nullity on the ground that no sufficient opportunity was given to the assessee. The Supreme Court
dismissed the petitions on the ground that the petitioner has efficacious alternative remedy by way of appeal to the prescribed authority under the
relevant enactment. While doing so, after referring to Releigh Investment Co. Ltd. v. Governor General in Council AIR 1947 P.C. 78 and K.S.
Venkataraman and Co. Vs. State of Madras, held thus :
We are dealing with a case in which the entrustment of power to assess is not in dispute, and the authority within the limits of his power is a
Tribunal of exclusive jurisdiction. The challenge is only to the regularity of the proceedings before the learned Sales Tax Officer also his authority to
treat the gross turnover returned by the petitioners to be the taxable turnover. Investment of authority to tax involves authority to tax transactions
which in exercise of his authority the Taxing Officer regards as taxable, and not merely authority to tax only those transactions which are, on a true
view of the facts and the law, taxable.
In Assistant Collector of Central Excise, Chandan Nagar, West Bengal Vs. Dunlop India Ltd. and Others, the Supreme Court observed at page
332 thus :
In Titaghur Paper Mills Co. Ltd. and Another Vs. State of Orissa and Others, A. P. Sen, E. S. Venkataramiah and R. B. Misra, JJ. held that
where the statute itself provided the petitioners with an efficacious alternative remedy by way of an appeal to the prescribed authority, a second
appeal to the Tribunal and thereafter to have the case stated to the High Court, it was not for the High Court to exercise its extraordinary
jurisdiction under Art. 226 of the Constitution ignoring as it were, the complete statutory machinery. That it has become necessary, even now, for
us to repeat this admonition is indeed a matter of tragic concern to us. Art. 226 is not meant to short circuit or circumvent statutory procedures. It
is only where statutory remedies are entirely ill suited to meet the demands of extraordinary situations, as for instance where the very vires of the
statute is in question or where private or public wrongs are so inextricably mixed up and the prevention of public injury and the vindication of public
justice require it that recourse may be had to Art. 226 of the Constitution. But then the Court must have good and sufficient reason to by-pass the
alternative remedy provided by statute. Surely matters involving the revenue where statutory remedies are available are not such matters. We can
also take judicial notice of the fact that the vast majority of the petitions under Art. 226 of the Constitution are filed solely for the purpose of
obtaining interim orders and thereafter prolong the proceedings by one device or the other. The practice certainly needs to be strongly
discouraged.
In view of the categorical dicta laid down by the Supreme Court in both the decisions cited supra, I am of the view that the writ petition has got to
be dismissed on the ground that the petitioners can very well pursue their remedies which are open to them under the Act after the final orders are
passed in the adjudication proceedings. As already observed, since orders have been reserved by the 1st respondent in this case, I do not think it
is possible for this Court to interdict with the proceedings and prevent the officer from passing an order, especially taking into account the fact that
the petitioners themselves refused to argue the case on merits. In my view, what is relevant for the purpose of adjudication of the proceedings it is
for the Presiding Officer to say and not for this Court to dictate. I am not convinced with the arguments of the learned senior counsel that a writ of
prohibition has to be issued as if the principles of natural justice have been violated on the facts of this case.
With regard to the additional affidavits filed before me, I do not think that the petitioners can improve their case further. Even according to the
additional affidavits, the reward scheme itself has been stayed by the Supreme Court and as such the reward scheme cannot be taken as a ground
to assail the action of the first respondent.
In the result, I do not find any merit in the writ petition and the same is dismissed.