Judgment delivered on : 13.04.2009
CORAM :-
HON'BLE MR JUSTICE VIKRAMAJIT SEN
HON'BLE MR JUSTICE RAJIV SHAKDHER
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1. Whether the Reporters of local papers may
be allowed to see the judgment ? Yes
2. To be referred to Reporters or not ? Yes
3. Whether the judgment should be reported Yes
in the Digest ?
RAJIV SHAKDHER, J
It is often said that the law acts ex-post facto. In the instant case,
the legislature has acted in pursuance of what is perceived as
undesirable - which is the right of a member/president/ vice-president
of the Customs Excise Service Tax Appellate Tribunal (hereinafter
referred to as the „CESTAT‟) to appear, act and/or plead on their
demitting office before the very same Tribunal. The legislature has
sought to debar all such like persons, by insertion of sub-section (6) to
Section 129 of the Customs Act, 1962 (hereinafter referred to as the
„Custom Act‟). The said provision was introduced by Section 110 of
the Finance Act, 2007 w.e.f. 11.05.2007.
1.1 The petitioners being aggrieved, have laid a challenge to the said
provision, broadly on two grounds. The first being, that Section
129(6) of the Customs Act is ultravires Articles 14, 19(1)(g) and 21 of
the Constitution of India. The second, that, in any event, Section
129(6) of the Act has no applicability to the petitioners in view of the
fact that at the time when they were appointed to CESTAT and also at
a point in time when they demitted the office, the said provision was
not on the statute book. In sum and substance, the petitioners contend
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that both on a plain reading of the provision, as also otherwise, it
cannot apply to the petitioners as they cannot be bound by a
conditionality of which they had no notice.
1.2 The petitioners have towards this end made the following
prayers which are common to each of the captioned writ petitions:
“(i) To strike down Section 129(6) of the Customs Act, 1962, as
being arbitrary, illegal and unconstitutional.
(ii) Consequently, to issue a writ of mandamus, or other writ, order
or direction in the nature of mandamus, directing the Tribunal to
permit the petition to appear and plead before it.”
1.3 In addition, in writ petition 6712/2007 entitled N.K. Bajpai vs
UOI & Ors. the following prayer has been made:
“(i) To issue a writ of certiorari, or other order or direction in the
nature of certiorari, quashing and setting aside the impugned
Misc Order dated 09.07.2007 passed in Service Tax Appeal No.
260 of 2007, whereby the Tribunal has held that the petitioner is
not eligible to appear and plead for the appellant in the said
appeals.”
1.4 Similarly, in writ petition 6710/2007, entitled P.C. Jain vs UOI
& Ors., an additional prayer has been made:
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“(i) To issue a writ of certiorari, or other order or direction in the
nature of certiorari, quashing and setting aside the impugned
Misc order dated 16.07.2007 and 26.07.2007 passed by the
Hon‟ble CESTAT in (Excise Appeal No. E/1722-23/07-Ex) &
(E/2844, 2469, 3034 of 2000 and E/251,252 of 2001)
respectively, whereby the Tribunal has held that the petitioner is
not eligible to appear and plead for the appellant in the said
appeals.”
2. The challenge to the miscellaneous order dated 09.07.2007 in
writ petition no. 6712/2007 arises on account of the fact that the
CESTAT had relieved the petitioner from appearing in the appeal filed
by his client before CESTAT in view of the provisions of Section
129(6) of the Customs Act. Similarly, in writ petition No. 6710/2007,
the petitioner has challenged the order dated 16.7.2007 and 26.07.2007
passed by two different benches of the CESTAT, whereby the
petitioner was prevented from appearing for his client before
CESTAT, again, on account of the bar incorporated in Section 129(6)
of the Customs Act. In passing the order dated 26.07.2007, the
CESTAT relied upon the order dated 09.07.2007 referred to
hereinabove passed in the case of Madhya Pradesh Consultancy
Organisation Ltd vs CCE, Bhopal being Service Tax Appeal No. 260
of 2007.
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2.1 In view of commonality of cause and almost similar facts
obtaining in the case of each of the petitioner(s) except for a minor
difference, in respect of, facts pertaining to the petitioner in writ
petition 6792/2007 to which we will advert as we go along with the
narration of facts, we have decided to pen a common judgment in
respect of the captioned writ petitions. With this, the facts relevant to
each of the petitioners are noted hereinafter.
2.2 In so far as the petitioner, Sh. K.L. Rekhi in writ petition
6792/2007 is concerned, he joined Indian Customs and Central Excise
Service, Class – I (later called Group „A‟) (in short the „service‟) on
10.01.1957. On 29.09.1982 he assumed the charge as Member
(Technical) Customs Excise and Gold (Control) Appellate Tribunal (in
short „CEGAT) (as it was then known). On 01.02.1989, he was
promoted in his parent cadre as Chairman, Central Board of Excise
and Customs (in short „CBEC‟), which is when, he relinquished charge
as Member, CEGAT. On 31.01.1991 Sh. K.L. Rekhi superannuated as
the Chairman of CBEC.
2.2 Sh. P.C. Jain, petitioner in writ petition 6710/2007, joined
service in July, 1963. On 01.05.1986 he assumed charge as Member
(Technical) in CEGAT. On 28.09.1999, when the petitioner demitted
office, he was the vice-chairman of CEGAT. In the interregnum, the
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petitioner had also obtained a bachelors degree in law, in 1991, from
University of Delhi.
2.3 Similarly, Shri. V.K. Aggarwal, the petitioner in writ petition no.
6711/2007, joined service on 13.11.1967. Shri. Aggarwal assumed
charge as Member (Technical) CEGAT on 02.03.1998. On
13.05.2005 Shri. Aggarwal demitted office as a member CESTAT.
Unlike others, Shri. Aggarwal had won a bachelors degree in law even
before he entered service, having passed out, from Lucknow
University in 1965.
2.4 As in the case of other petitioners, Sh N K Bajpai, the petitioner
in writ petition 6712/2007 entered service on 24.05.1960 with a
bachelors degree in law having passed out from Allahabad university
in 1956. He assumed charge as Member (Technical) CEGAT on
01.11.1990, and on 07.03.1993, he demitted office as Member
CEGAT.
3. A perusal of the facts, adverted to above, would show that
except for Sh. K.L. Rekhi, the other three petitioners, that is, P.C. Jain.
V.K. Aggarwal, and N.K. Bajpai are law graduates. On demitting
office, it is stated that Sh. Rekhi had been appearing for litigants
before the CEGAT and thereafter, the CESTAT, as it is presently
known, as an authorised representative of his clients, in accordance
with, the provisions of the relevant Act and the Rules enacted
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thereunder. We shall advert to the relevant provisions in the course of
our judgment.
4. Since reliefs claimed by the petitioners are pivoted on the
challenge laid to the provisions of Section 129(6) of the Customs Act
and/or its applicability, for the sake of convenience, it would be
relevant to extract the said section in its entirety.
129 Appellate Tribunal –
(i) The Central Government shall constitute an
Appellate Tribunal to be called the Customs, Excise and
Service Tax Appellate Tribunal consisting of as many
judicial and technical members as it thinks fit to exercise the
powers and discharge the functions conferred on the
Appellate Tribunal by this Act.
(2) A judicial member shall be a person who has for at
least ten years held a judicial office in the territory of India
or who has been a member of the Indian Legal Service and
has held a post in Grade I of that service or any equivalent
or higher post for at least three years, or who has been an
advocate for at least ten years.
Explanations: For the purposes of this sub-section,
-
(i) In computing the period during which a person
has held judicial office in the territory of India, there
shall be included any period, after he has held any
judicial office, during which the person has been an
advocate or has held the office of a member of a
tribunal or any post, under the Union or a State,
requiring special knowledge of law;
(ii) In computing the period during which a person
has been an advocate, there shall be included any
period during which the person has held a judicial
office, or the office of a member of a tribunal or any
post, under the Union or a State, requiring special
knowledge of law after he became an advocate.
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(2A) A technical member shall be a person who has been a
member of the Indian Customs and Central Excise Service,
Group A, and has held the post of Commissioner of Customs
or Central Excise or any equivalent or higher post for at
least three years.
The Central Government shall appoint –
(3)
(a) a person who is or has been a judge of a High
Court; or
(b) one of the members of the Appellate Tribunal,
to be the President thereof,
(4) The Central Government may appoint one or more
members of the Appellate Tribunal to be the Vice-President,
or, as the case may be, Vice-Presidents, thereof.
(5) A Vice-President shall exercise such of the powers and
perform such of the functions of the President as may be
delegated to him by the President by a general or special
order in writing.
(6) On ceasing to hold office, the President, Vice-
President or other Member shall not be entitled to appear,
act or plead before the Appellate Tribunal.
SUBMISSIONS ON BEHALF OF THE PETITIONERS
5. In the context of the aforesaid provision, that is, sub-section (6)
of Section 129 of the Customs Act, (in short the „impugned
provision‟), it is contended on behalf of the petitioners that the sub-
section can have no applicability to the petitioners who were appointed
as member, vice-president and president before the insertion of the
said provision in the Act and, therefore, they had not subjected
themselves to the bar or the limitation contained therein, at a point in
time when they entered service. As a matter of fact, the petitioners
contend that the provision was not on the statute book even when they
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demitted office as a member/vice-president of CESTAT. Reliance in
this regard is placed on the judgment of the Supreme Court in
Sukumar Mukherjee vs State of West Bengal & Anr. (1993) 3 SCC
723. The petitioners also contend that a bare perusal of the language
of sub-section (6) of section 129 of the Customs Act would show that
it is applicable prospectively. To drive home this point, the petitioners
have referred to the language in Article 124(7) and Article 220 of the
Constitution of India, wherein the expression found is “has held
office” as against “ceasing to hold the office” as found in Section
129(6) of the Customs Act.
6 The petitioners on the aspect of the Constitutional invalidity of
the provision have laid challenge by invoking provisions of Article 14,
Article 19(1)(g) and Article 21 of the Constitution of India. The
challenge on the basis of the violation of Article 14 of the Constitution
of India is rested on the submission that there is no discernable reason
for enacting such a provision as there is no „Statement Of Object And
Reasons‟ accompanying the enactment nor do the „Notes to clauses‟ or
the counter affidavit filed by the respondent delve on the evil or
mischief which was sought to be remedied by the impugned provision.
It was contended at the bar that members of other Tribunals, such as,
the Income Tax Appellate Tribunal and Appellate Tribunal for Foreign
Exchange are not disabled from appearance or from acting or pleading
for their clients before their respective Tribunals, even though the
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provisions relating to their recruitment, method of appointment,
selection procedure are almost similar. The petitioners contend that
this is discriminatory and hence violative of Article 14.
7 The violation of Article 19(1) of the Constitution is alleged on
the ground that even though 3 out of 4 petitioners are enrolled with the
Bar Council Of Delhi, they are prevented from practising their
profession by virtue of the impugned provision, which is directly in
conflict with their rights to practice as an advocate; before any court
including the Supreme Court or any Tribunal or any person legally
authorised to take evidence - as encapsulated in Section 30 of the
Advocates Act, 1961 and Section 14 of the Indian Bar Councils Act,
1926. Here it is relevant to point out that the petitioners have
submitted that even if it is conceded that Section 30 of the Advocates
Act has not been brought into force and is thus not available to the
petitioners, the provisions of Section 14 of the Indian Bar Councils
Act, 1926, which is pari materia with Section 30 of the Advocates Act,
1961, provides a sufficient plank on which their challenge to the
impugned provisions can be sustained. Reliance in this regard is
placed on a Full Bench Judgment of the Punjab & Haryana High Court
in the case of Smt. Jaswant Kaur & Anr. Vs State of Haryana AIR
1977 P&H 221. It is thus contended that the restriction contained in
the impugned provision is not reasonable within the meaning of
Article 19(6) of the Constitution.
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8 In the same vein, it was also submitted that the impugned
provision violates the Article 21 of the Constitution, in as much as, it
deprives a person of his right to livelihood.
9 To buttress their submissions, the petitioners have also referred
to the provisions of Section 146A(2)(c) of the Customs Act and
identical provision, that is, contained in Section 35Q(2)(c) of Central
Excise Act, 1944 (in short the „Excise Act‟) as also in Section 83 of
the Finance Act, 1994, which by incorporation, refers to, amongst
others, to section 35Q of the Excise Act. The said provisions entitles a
legal practitioner to appear as an authorized representative before an
officer of the customs/excise/service tax or the Appellate Tribunal
(i.e., the CESTAT) in any proceeding under the concerned Act, that is,
the Customs Act, the Excise Act or even the Finance Act, 1994.
10 In so far as the fourth petitioner, Shri Rekhi, is concerned, it is
contended that he was entitled to appear, act or plead before CESTAT
in his capacity as an authorised representative, by virtue of the
provisions of Section 146A(2)(d) read with Rule 9(e) of the Customs
(Appeals) Rules, 1982; Section 35Q(2)(d) read with Rule 12(e) of the
Central Excise (Appeals) Rules, 1982 and the Rule 2(C)(i) & (ii) of
Customs Excise and Service Tax Appellate Tribunal (Procedure)
Rules, 1982. It is contended that the right to practice before CESTAT
stood vested in the petitioners which could not have been taken away
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without the affected persons having knowledge of such a prohibition
as contained in the impugned provision at the time when they accepted
appointment to the CESTAT.
11 The petitioners attempted to demonstrate the anomaly in the
amendment brought about by the Finance Act, 2007 by submitting that
the provisions of sub-Section (1) to sub-section (5) of Section 129 deal
essentially with the manner in which the Central Government would
go about constituting the CESTAT, and the qualifications which would
be required for being appointed as the judicial/ technical members,
vice-president and the president of the CESTAT. Therefore, the
impugned provision, that is, sub-section (6) to Section 129, which was,
brought on to the statute book by virtue of the Finance Act, 2007 w.e.f.
11.05.2007 could not by incorporation or otherwise transpose the bar
of the impugned provision into the definition of „Appellate Tribunal‟
as set out in Section 2(aa) of the Excise Act and Section 65(5) of the
Finance Act, 1994 which were inserted in the respective statute much
prior in point of time. In other words, the arguments made is as
follows:
(i) The definition of Appellate Tribunal which is contained in
section 2(aa) of the Excise Act was inserted in the Excise Act by Act
44 of 1980 Section 50 and Schedule V w.e.f 11.10.1982. The said
definition was amended to attain its present form by substitution of the
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expression “service tax” in place of “Gold(Control)” by Act 32 of
2003 by Section 135 w.e.f. 14.05.2003. Similarly, the definition of
Appellate Tribunal as contained in Section 65(5) was part of the parent
statute, which was brought into force w.e.f. 01.07.1994. Given this
position, the insertion of sub-section (6) in Section 129 of the Customs
Act in May 2007 could not have telescoped, in manner of speaking,
into the definition of Appellate Tribunal contained in Section 2(aa) of
the Excise Act and Section 65(5) of the Finance Act, 1994, which have
been on the statute book since 1982 and 1994 respectively.
(ii) The petitioner thus contended that, in substance, the incongruity
stands out, in as much as, the assuming without admitting that the
provision is valid the petitioner will be barred for appearing before the
CESTAT with respect to the matters arising out of the Customs Act
only, and not in respect of those matters which pertain to the Excise
Act and the Finance Act, 1994. They submitted that the said situation
is not cured even if the regard is had to section 12 and Section 35D of
the Excise Act.
(iii) The learned counsel for the petitioners also sought to place
reliance on the parliamentary debates with respect to the amendment
brought about in Article 220 of the Constitution by the 7th Amendment
Act of 1956, whereby the said Article was amended to restrict the bar
on a permanent judge of a High Court to plead or act in any court or
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before any authority in India, except the Supreme Court, to the court of
which he was a permanent judge and the authorities over which that
High Court exercised supervisory jurisdiction.
(iv) The learned counsel for the petitioners submitted that the onus
was on the respondents, that is, the State, to demonstrate the
reasonableness of the restriction. It was also submitted that the
respondents had failed to discharge this onus. In this regard, reliance
was placed on judgment of the Supreme Court in Municipal
Corporation of the City of Ahemdabad & Ors vs Jan Mohammed
Usmanbhai & Anr. (1986) 3 SCC 20, Saghir Ahmed & Anr. Vs State
of U.P. & Ors. AIR (1954) SC 728 and M/s Laxmi Khandsari & Ors.
vs State of U.P. & Ors (1981) 2 SCC 600.
SUBMISSIONS ON BEHALF OF THE RESPONDENTS
12 The learned Additional Solicitor General, Sh. P.P. Malhotra who
appeared on behalf of the respondents took us through the brief history
which led to the insertion of the impugned provision in the Customs
Act. It was pointed out that in 1986 the Parliament enacted the
Customs and Excise Revenue Appellate Tribunal Act of 1986 (in short
the „CERAT Act‟) for the purposes of setting up a Tribunal in
consonance with the power contained in Article 323B of the
Constitution of India. The CERAT Act not only contained a provision
whereby jurisdiction of all courts (including the High Court) save and
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except the Supreme Court was excluded, but also Section 11(c) which
barred the president or a member from appearing, acting or pleading
before the Appellate Tribunal or the CEGAT. The Supreme Court in
the case of L. Chandrakumar vs UOI: (1997) 3 SCC 261 declared as
an unconstitutional Clause 2(d) of Article 323A and Clause 3(d) of
Article 323B of the Constitution which, inter alia, vested power in the
Central and the State Governments to constitute Tribunals over which
the Supreme Court‟s jurisdiction under Article 32 and that of the High
Court jurisdiction under Articles 226 and 227 of the Constitution stood
excluded. This led to the recommendation for repeal of CERAT Act,
which was eventually brought about in 2004.
13. The learned ASG took us through the file notings of the
Government of India which established that the issue of appearance by
president/vice-president/members of CESTAT on demitting before the
CESTAT was discussed at highest level through out 2005 till the
insertion of the impugned provision in May, 2007. Towards this end,
the Government of India had also sought the input of the president of
the CESTAT, Justice R.K. Abhichandani, who recommended that the
provisions of Section 11(c) in the repealed CERAT Act should be
brought into force immediately. Inputs were also sought from the
Ministry of Law as well as the Department of Personnel and Training.
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14. The learned ASG also brought to our notice an inter-
departmental letter dated 20.09.2007 exchanged between the Ministry
of Law and Justice, Department of Legal Affairs and the Department
of Revenue‟ which suggested that the Government was in principle
agreed that steps should be initiated to bring about a suitable
amendment so that similar bar could be incorporated in the Income
Tax Act, in respect of, members of the Income Tax Appellate
Tribunal.
15. The submission of the learned ASG was, in a nut shell that, this
was an aspect which was pending consideration since 1986 and for one
reason or the other, it could not be brought on the statute book. His
submission was that this was not as if it was a complete bolt from the
blue as sought to be portrayed by the petitioners. As a matter of fact,
the Government, according to him, was contemplating such like
amendment in other pari materia statutes, in consonance with, the
provisions of Section 129(6) of the Customs Act. He also drew our
attention to the provisions of Section 11(f) of the Administrative
Tribunal Act, 1985 and submitted that the terms and conditions of the
Railway Tribunal contained similar provisions which barred members
and the chairman of such tribunals from appearing, acting or pleading
before the tribunal of which a person was a chairman or a member.
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16. The learned ASG submitted that the right to practice a
profession can be regulated and a regulation by itself unless
completely unreasonable, would not be violative of any fundamental
rights of the petitioner. In this regard, he placed reliance on the
judgment of the Supreme Court in Devata Prasad Singh Chaudhuri
& Ors vs Hon’ble the Chief Justice and the Judges of the Patna
High Court AIR (1962) SC 201.
17. It was thus contended that the bar against the appeals before the
CESTAT could not be held to be unreasonably restrictive in view of
the fact that the petitioners on account of their expertise were free to
appear before superior forums all over the country, that is, the High
Court to which an appeal under the respective statutes‟ lies against the
orders of the CESTAT, as also, the Supreme Court.
18 It was also submitted on behalf of the respondents that the
contention of the petitioners‟ that the provision could not be made
applicable to them in view of the fact that it was not on the statute
book at the time of their appointment and at the time when they
demitted office, was untenable for the reason that the bar applied to the
right to practice. It was contended that the right to practice was not a
condition of service, and assuming without admitting that it was, it is
well-settled that a condition of service in respect of a government
servant can be changed unilaterally, as after entering service the legal
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relationship of a Government Servant is in the nature of a „status‟, the
terms of which are fixed by law and not governed by the ordinary law
of contract of service subsisting between a master and servant.
Reliance in this regard was placed on the judgment of the Supreme
Court in the case of Roshan Lal Tandon vs UOI AIR (1967) SC 1889.
It was submitted that the submission of the petitioner that the
impugned provision could not have retrospective operation was not
tenable in view of the fact that the expression “on ceasing to hold
office” in the impugned provision could only mean that henceforth
those to whom the bar applied would not be allowed to practice before
the CESTAT.
19. The learned ASG laid great stress on the fact that in the present
time, the insertion of the impugned provision was desirable. He
submitted that the impugned provision endeavours to fulfil a greater
public good, that is, administration of justice as against less significant
private interest of the petitioner. Hence, the latter would have to give
way to the former.
OUR ANALYSIS
20. There was a time when a son would appear in the court presided
over by his father and no questions were asked. It is said Boswell
earned most part of his income at the Scottish Bar appearing before his
father Lord Auchinleck (see Natural Justice, 2nd Edition Paul Jackson).
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The legislative wisdom ideally caters to times we live in and the social
mores and norms that surround us. Alas! as is often found steps
towards what the law makers consider a desirable goal, which is
wisdom that courts accord to a legislature, are often agonisingly slow.
The instant case is a prime example of the same. An exercise which
started with enactment of CERAT Act in 1986 was given a complete
go-by by the repeal of the statute in 2004. The ostensible reason for
repeal was the judgment of the Supreme Court in the case of L.
Chandrakumar (supra) which reversed the blatant usurpation of writ
jurisdiction of the Supreme Court and the High Courts by declaring as
unconstitutional the provisions of Clause 2(d) of Article 323A and
Clause 3(d) of Article 323B of the Constitution which enabled the
Centre and State Governments to enact such manifestly unjust
legislation. But the repeal of 2004 did something more it threw the
baby with the bath water. The salutary provision, such as Section
11(c) was also repealed. The provision was resurrected in 2005. From
then, it took two years for the provision to be brought to the fore by the
Finance Act, 2007. With the result, the petitioners today contend
before us that both at the point in time when they entered service and
when they demitted office, the impugned provision was not in place.
The petitioners are aggrieved and perhaps justifiably as they have been
in practice, since demitting office, for periods ranging from two(2)
years in the case of Sh. V.K. Aggarwal to sixteen(16) years, in the case
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Sh. K.L. Rekhi before the date on which the impugned provision was
brought on to the statute book i.e. 11.05.2007. But the validity of a
statute cannot be judged only on the basis rights of an individual when
an individual‟s right are pitted against a greater public weal.
Individual rights have to give way to a greater public interest. And
who best knows the public interest but the legislature unless shown
otherwise - while always bearing in mind that the courts as the
sentinels of the Constitution are fully empowered to defend and protect
an individual‟s fundamental rights, if an act of the Parliament trenches
upon inalienable right of an individual which are in conflict with
interest of the majority. The burden is heavy. There is a presumption
of constitutionality in respect of an Acts of a legislature.
21. With the aforesaid preface, let us examine the nuts and bolts of
the challenge of the petitioners to the impugned provision. The
challenge to the impugned provision based on petitioners rights under
Article 14, 19(1)(g) and 21 of the Constitution, on a close scrutiny,
according to us, is untenable. The charge of violation of Article 14 is
levelled on the ground that firstly, the respondents have been unable to
demonstrate either by way of Statement of Objects And Reasons or
Notes to clauses or even by way of averments in their counter
affidavit the evil or mischief which is sought to be remedied by
insertion of the impugned provision; and secondly, the impugned
provision is discriminatory, in as much as members of other Tribunals,
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such as, the Income Tax Appellate Tribunal and the Appellate
Tribunal for Foreign Exchange are not barred from appearing, acting
or pleading before Tribunals of which they have been members.
22. This submission, according to us, fails to take into account the
common law principle, now well entrenched in our jurisprudence;
which to borrow the words of Lord Hewart compel us to ensure that in
“all fundamental matters justice should not only be done but the
manifestly and undoubtedly be seen to be done”. R vs Sussex JJ, Ex.
P. McCarthy (1924) 1 K.B. 256 at page 259. This principle finds echo
in the other well settled principle i.e., „real likelihood of bias‟ or „a
reasonable suspicion of bias‟. In respect of pecuniary interest the bias
is apparent and needs no further scrutiny. It is when there is a bias
which has no pecuniary dimension that this rule is invoked. One
would often wonder as to why such a rule is invoked which is based on
nebulous premise of suspicion. The answer lies perhaps in the
following in the statement of law encapsulated by Paul Jackson in his
book on Natural Justice (2nd edition), which according to us,
appropriately enunciates the raison d’etre for invoking the Rule of
Bias to strike down a decision without actual proof of such bias:-
“The courts do not, normally, inquire whether a
tribunal was, in fact, biased. In the case of a
pecuniary interest disqualification is automatic; “the
law does not allow any further inquiry as to whether
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or not the mind was actually biased by the pecuniary
interest”; per Bowen L.J., Lesson v. General Medical
Council (1989) 43 Ch.D. 336, 384. Such an attitude
can be represented as revealing of the materialistic
view of human nature taken by the common law and
contrasts with allegations of bias arising from non-
financial factors where it is necessary to satisfy a
test which has been variously described as involving
“a real likelihood of bias” or “a reasonable
suspicion of bias.” The explanation of this approach
is two-fold. First, the efficacy of the rule against
bias would be greatly reduced if the complainant
had to prove actual bias. Secondly, the law is
concerned with public confidence in the
administration of justice and the need to ensure that
individuals feel that they have been given a fair
hearing” (emphasis is ours)
23. In our view, therefore, for the petitioners to contend that there
should have been some kind of empirical data to suggest that there had
been instances of misdemeanour which would have propelled the
respondents to insert such a provision in the enactment is based on a
misappreciation of a fundamental premises that a court‟s authority is
based on the public perception especially that of the litigants appearing
before it, that the process of administration of justice is far removed,
from even the remotest possibility of bias creeping into the decision
making process. Therefore, to contend otherwise is to ignore the very
edifice on which the administration of justice is built.
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24. In our view, the purported discrimination claimed by the
petitioners on account of the fact that members of tribunals such as the
Income Tax Appellate Tribunal and the Appellate Tribunal for Foreign
Exchange are not visited with such disability, is also untenable. The
fact that a beginning has been made by incorporating such like
provisions in respect of some tribunals, such as, the CESTAT, the
Central Administrative Tribunal constituted under the Administrative
Tribunal Act, 1985 (see Section 11(f)) would only lead us to conclude
that the impugned provision is not discriminatory. In our opinion the
step taken towards insertion of the impugned provision is reformatory
and not discriminatory, as contended by the petitioners. At this point it
would perhaps be important to note that before inserting the impugned
provision, inputs were taken from various sources, including the sitting
president who was none-else than a retired Judge of a High Court. The
recommendation, in respect of which, we have no doubt must have
been made by a high functionary, such as, the President of CESTAT
with a keen sense of responsibility after taking into account his
experience gained both on the judicial and administrative side in the
working of CESTAT.
25. This brings us to the challenge that the petitioners have made on
the grounds of violation of their right under Article 19(1)(g) of the
Constitution. The petitioner in order to buttress their argument have
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relied upon the judgment of the Punjab & Haryana High Court in the
case of Jaswant Kaur (supra) which was upheld by the Supreme
Court in the case of H.S. Srinivasa Raghavachar and Ors. vs State of
Karnataka & Ors. (1987) 2 SCC 692 (see paragraph 9 at page 242),
in so far as issue with regard to prohibition on legal practitioners
appearing in various proceedings before Land Tribunals was
concerned. Justice O. Chinappa Reddy (as he then was) speaking for
the Full Bench of the Punjab and Haryana High Court struck down
Section 20A of the Haryana Ceiling of Land Holdings Act, 1972 on
the ground of lack of legislative competence, for the reason that, both
Section 30 of the Advocates Act, 1961 (which was found to be not in
force) and Section 14 of the Indian Bar Councils Act, 1961 which
entitled an advocate to practice before any court, Tribunal or person
legally authorised to take evidence, were rights conferred by the
Parliament by enactment of the said statutes in exercise of its powers
conferred under entries 77 and 78 of List-I, which could not have been
taken away by a Law enacted by the State. Justice Chinappa Reddy in
H.S. Raghavachar (supra) while sitting in the Division Bench in the
Supreme Court, once again speaking for the court applied the ratio of
the judgment in the case of Jaswant Kaur (supra) and struck down a
similar provision, that is, Section 48(8) of the Karnataka Land
Reforms Act, 1961 which barred legal practitioners from appearing
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before the Land Tribunals, functioning under the Karnataka Land
Reforms Act, 961.
26. In our view, the two cases cited by the petitioners are clearly
distinguishable. In both the cases the court struck down the bar placed
on the legal practitioners to practice before the Tribunal constituted
under the concerned statutes on the ground that the prohibition was
enacted by the State which trenched upon the right to practice
conferred by a law enacted by the Parliament and hence the State law
was bad in so far as it trenched upon the law enacted by the
Parliament. In the instant case the impugned provision is incorporated
in a central statute. Hence the said ratio of these aforementioned
decision would not apply to the instant case.
27. The submission of the learned counsel for the petitioners that the
restriction contained in the impugned provision is unreasonable and
not in the interest of general public as contemplated under Article
19(6) of the Constitution, on account of the fact that petitioners who
are experts in their respective fields would enhance public interest by
making themselves available not only to further the cause of the
assessees but also that of the Revenue. In our view this submission
misses the wood from the trees. The predominant rationale for
introduction of this provision is to strengthen the cause of
administration of justice. To remove what the legislature in its wisdom
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feels is a perceived class bias. If that be so, then the restriction cannot
be said to be unreasonable. It would pass the test of Article 19(6) of
the Constitution. There is no gainsaying that the petitioners have
acquired expertise in the field of law pertaining to customs, excise and
service tax. That being said the impugned provision does not
completely prohibit them from practicing their profession. The
prohibition is with respect to a forum. The petitioners‟ expertise can
and ought to be applied in superior forums, such as, the High Courts
and also the Supreme Court. It would in our opinion help develop and
foster entry of fresh blood and talent at the level of the tribunals and at
the same time make available much needed expertise in the superior
forums. There is no denying that there is paucity of lawyers who are
experts in fields such as, customs, excise and service tax in superior
courts. The amendment, according to us, meets various facets of
public interests and hence cannot be dubbed as one which is
unreasonably restrictive or one which completely fore-closes all
opportunities available to the petitioners to exercise their profession
calling.
28. There is another aspect of the matter, which is, as to whether it
can be contended that the petitioners have an unregulated right of
practice in the forums in which they chose to appear. A reading of
provisions of Section 14 of the Indian Bar Councils Act, 1926 makes it
clear that it is subject to the rules that a court before which an advocate
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appears makes in that behalf. As rightly contended by the learned
ASG the Supreme Court in the case of Devatta Prasad (supra) have
held that the High Courts are empowered to regulate the right to
practice. We may with profit extract the observations, of a three Judge
Bench of the Supreme Court in the case Lingappa Pochanna vs State
of Maharastra: AIR 1985 SC 389 at pages 403 to 404 (Paragraphs 32
to 35). The Supreme Court in the said case, amongst others, answered
the issue as to whether 9A of the Maharastra Restoration of Lands to
Schedule Tribes Act, 1974, which barred advocates from appearing for
any party in any proceeding under the said Act before the
Commissioner, Collector or the Maharastra Revenue Tribunal.
“32. The next and the last question that arises is whether
Section 9A of the Act is constitutionally void as it affects
(i) the fundamental right of an advocate enrolled by the
State Bar Council of Maharashtra to carry on his
profession guaranteed by Article 19(1)(g) of the
Constitution and (ii) the right of the appellants who are
non-tribals being prevented to be represented by a legal
practitioner of their choice.
33. The problem before us has to be viewed from two
angles: first, from the view point of the legal
practitioner, and secondly from that of the litigants.
Though the question for consideration as to whether
Section 9A of the Act offends Art. 19(1)(g) is of
considerable importance to the litigant public in general,
and the legal profession in particular it is no longer res
integra, it being practically concluded by several
decisions of the various High Courts, from both the view
points noted above. Section 9A of the Act reads :
9A. Notwithstanding anything contained in this Act or any
law for the time being in force, no pleader shall be
entitled to appear on behalf of any party in any
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proceedings under this Act before the Collector, the
Commissioner or the Maharashtra Revenue Tribunal:
Provided the, where a party is a minor or lunatic, his
guardian may appear, and in the Case of any other
person under disability, his authorised agent may appear,
in such proceedings.
34. The contention that an advocate enrolled under the
Advocates Act, 1961 has an absolute right to practise
before all Courts and Tribunals can hardly be accepted.
Such a right is no doubt conferred by Section 30 of the
Advocates Act. But unfortunately for the legal profession,
Section 30 has not been brought into force so far though
the Act has been on the Statute Book for the last 22 years.
There is very little that we can do in the matter and it is
for the Bar to take it up elsewhere. A person enrolled as
an advocate under the Advocates Act is not ipso facto
entitled to a right of audience in all Courts unless
Section 30 of that Act is first brought into force. That is
a matter which is still regulated by different statutes and
the extent of the right to practise must depend on the
terms of those statutes. The right of an advocate brought
on the rolls to practise is, therefore, just what is conferred
on him by Section 14(1)(a), (b) and (c) of the Bar
Councils Act, 1926. The relevant provisions reads as
follows:
14(1). An advocate shall be entitled as of right to practise
:
(a) subject to the provisions of Sub-section (4) of Section
9, in the High Court of which he is an advocate, and
(b) save as otherwise provided by Sub-section (2) or by or
under any other law for the time being in force in any
other Court and before any other Tribunal or person
legally authorized ' to take evidence, and.
(c) before any other authority or person before whom
such advocate is by or under the law for the time being in
force entitled to practise.
In view of the various authorities on the subject, we
cannot but hold that Section 9A of the Act is not an
unconstitutional restriction on advocates to practise their
profession.
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35. That brings us to the second aspect of the matter i.e.
the so-called right of a litigant to be represented before
the Collector in matters not covered by Sections 3(1) and
4 of the Act. Now it is well-settled that apart from the
provisions' of Article 22(1) of the Constitution, no litigant
has a fundamental right to be represented by a lawyer in
any Court. The only fundamental right recognized by the
Constitution is that under Article 22(1) by which an
accused who is arrested and detained in custody is
entitled to consult and be defended by a legal practitioner
of his choice. In all other matters i.e. in suits or other
proceedings in which the accused is not arrested and
detained on a criminal charge, the litigant has no
fundamental right to be represented by a legal
practitioner. For aught we know, the legislature felt that
for the implementation of the legislation, it would not
subserve the public interest if lawyers were allowed to
appear, plead or act on behalf of the non-tribal
transferees. It cannot be denied that a tribal and a non-
tribal are unequally placed and non-tribal transferee
being a person belonging to the more affluent class,
would unnecessarily protract the proceedings before the
Collector under Ss. 3(1) and 4 of the Act by raising all
kinds of pleas calculated to delay or defeat the rights of
the tribal for restoration of his lands. The proceedings
before the Collector have to be completed with sufficient
despatch and the transferred lands restored to a tribal
under Sub-section (1) of S. 3 and Section 4 of the Act
without any of the law's delays.”
Also see judgment of the Supreme Court in Paradip Port Trust
vs Their Workmen: 1997 (1) SCR 537.
29. The submission of the petitioners that impugned provision
violates Article 21 of the Constitution is also untenable. As stated
above, there is no deprivation of right to livelihood as contended by
the petitioners. There are admittedly several avenues open to the
petitioners to earn their livelihood. This submission is deserves to be
rejected at the very threshold.
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30. The other submission of the petitioners which is that the reading
of sub-section (6) of Section 129 of the Customs Act when compared
with Article 220 and 124(7) of the Act would show that the impugned
provision could not possibly apply to the petitioners as the expression
found in sub-section (6) of Section 129 of the Customs Act is “on
ceasing to hold office”, which, according to the petitioners can only
imply that the said provision is prospective. In our view such a
submission is without merit. We agree with the submissions of the
learned ASG that prohibition applies to the petitioners and all such like
persons who have demitted their office both before the date of
insertion of the impugned provision and thereafter as the prohibition is
attached to the right to appear before the CESTAT. To this extent the
argument that it seeks to take away a vested right is untenable. In any
event as indicated by us above the right to practice before a forum is
not an unbridled right which cannot be regulated.
31. The other submission of the petitioners that the impugned
provision is incongruous, in as much as, the amendment has only been
made in section 129 of the Customs Act by virtue of the Finance Act,
2007 with no corresponding amendments in Section 2(aa) of the
Excise Act and Section 65(5) of the Finance Act, 1994, as on the date
of the amendment brought about by Finance Act, 2007, the said
provisions, that is, Section 2(aa) of the Excise Act and Section 65(5) of
the Finance Act 1994 were already on the statute book. In our view
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this argument, in the first instance seems to be attractive, but on a
closer scrutiny, does not lend credence to case of the petitioners.
There is no denial of the fact that there is a single tribunal, that is,
CESTAT which adjudicates upon matters which pertain to customs,
excise and service tax. There is also no dispute that the members,
vice-president and president are the same persons who hear and
adjudicate upon the matter involving the aforementioned three streams
of law. That being the position, the prohibition contained in the
impugned provision gets attracted no sooner the person who has held
the office of the president/ vice-president or a member of the Appellate
Tribunal which is a common tribunal, that is, the CESTAT seeks to
appear, act or plead before the CESTAT. It makes no difference that
corresponding amendments have not been brought about in the Excise
Act or the Finance Act, 1994, because the prohibition is not attached to
the stream of law which is practiced before CESTAT. The prohibition
or the bar on appearance is vis-a-vis the forum and the trigger for
invoking the bar is that the person concerned should have held the
office of a member, vice-president or president of the said forum.
Once the right to appear, act or plead is taken away and since the same
forum hears and adjudicates upon matters concerning the three streams
of law, the person concerned is automatically de-barred from acting,
appearing or pleading before the said forum, that is, CESTAT.
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32. In this context, it would be important to also take note of the fact
that the petitioners have laid stress on the parliamentary debates
whereby amendment was brought in Article 220 of the Constitution of
India limiting prohibition on the right of a permanent Judge of a High
Court to plead or act to the courts of which he has been a permanent
judge or the Courts/tribunals/authorities over which the said High
Court exercised supervisory jurisdiction. Even though it is trite law
that parliamentary debates by themselves cannot be used to decide the
interpretation, that is to be placed on the provisions of a Act, we
considered the debates closely. The sense which was conveyed
through the debates was that a complete bar on practice by permanent
Judges of the High Court as it had been obtained prior to the 7th
Amendment Act, 1956 could be put in place, if the incumbent was
compensated adequately in pecuniary terms by making the pension
equivalent to salary last drawn and increasing the retirement age to 65
years. The rationale supplied for bringing about the amendment was,
that the appointment to the Bench of the High Court was brought about
at a relatively late age and then to deprive a judge completely, a right
to practice, in any High Court would act as a disincentive for getting
the best talent to accept judgeship.
32.1. According to us, the petitioner cannot derive any benefit by
adverting to the said debates which relate to the provisions of the
Constitution which are applicable to the judges of the High Court and
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the Supreme Court. On the contrary as stated above the debates
seemed to indicate that a total ban on practice would have been
acceptable to the legislatures, provided it was duly compensated. In
the instant case the prohibition is decidedly partial. The prohibition is
confined only to CESTAT. According to us, the legislature is best
equipped to take a decision in this regard. Having taken a decision,
which, according to us, is neither unreasonably restrictive nor violative
of any of the fundamental rights of the petitioners as guaranteed by the
Constitution, there is no reason for us to either strike down the
impugned provision as being ultravires the Constitution or to read it in
a fashion that makes it prospective in its application. To our minds
there is no reason to draw a distinction between persons who have
demitted office prior to the insertion of the impugned provision, that
is, 11.05.2007 and those who would demit office thereafter. If the
rationale for inserting the provision is that it would enhance public
interest by strengthening the administration of justice, we would not
impede the said pursuit of the legislature based on tenuous submission
of the petitioners.
33. This leaves us with one petitioner, that is, Mr. K.L. Rekhi who,
as indicated in the beginning, has not obtained a degree in law but was
practicing before the CESTAT in his capacity as an authorised
representative. As a matter of fact, the other petitioners have also
made an incidental submission that no corresponding amendments
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have been made in the provision adverted hereinabove pertaining to
the right of the authorised representative to appear for a litigant before
the CESTAT. The prohibition is clearly attracted to Sh. K.L. Rekhi
who demitted office as the member of then CEGAT on 01.02.1989.
The petitioner Sh. K.L. Rekhi, in our view, is not in any manner
constrained in making use of the experience gained by him as a
member of the then CEGAT like the other petitioners. If, however, he
wishes to practice as a legal practitioner, he would be required to
obtain a degree in law and then be free to appear before all such
forums except the CESTAT. The fact that his right to appear as an
authorised representative is hit by insertion of the impugned provision
itself answers the issue that the fact that no amendment has been made
to Section 146A of the Customs Act and the Rules framed thereudner
or even in Section 35Q of the Excise Act and the Rules framed
thereunder, in no way impinges upon the legal efficacy of the
impugned provision, since the prohibition is with respect to the right of
appearance before a forum by any person whether he is a legal
practitioner or an authorized representative, in respect of a person who
has been a member, vice-president or president of CESTAT.
34. For the reasons that we have given, the judgment of the Supreme
Court in Sukumar Mukherjee (supra) has no application as it dealt
with the right of private practice of doctors who were desirous of being
a part of newly created service set up by the State of West Bengal,
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without having to give up on their right of private practice which they
had prior to the said service being constituted by the State
Government. According to us, the ratio of the judgment has no
applicability since in the instant case we are not dealing with a
condition of service.
34. Similarly, the judgment of the Supreme Court in the case of B.P.
Sharma vs Union of India (2003) 7 SCC 309 will also have no
application which essentially deals with the challenge to the purported
prohibition under the provisions of the Ancient Monuments and
Archaeological Sites and Remains Act, 1958 and the rules made
thereunder on the right of a person to seek renewal of his licence to act
as „approved guides‟ after the age of 60 years. The facts in the said
case are entirely different.
35. In view of our discussion above, we are of the opinion that the
challenge to the provisions of Section 129(6) of the Customs Act
cannot sustained. In these circumstances, all four writ petitions, that is
writ petition Nos. 6710/2007, 6711/2007, 6712/2007 & 6792/2997 are
dismissed. However, there shall be no orders as to cost.
RAJIV SHAKDHER, J
April 13, 2009 VIKRAMAJIT SEN, J
kk
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