Union of India (UOI) vs J and K Cigarettes Ltd.

M.L. Koul, J.—These two Letters Patent Appeals owe their origin to two orders of the appellant No. 4 dated 6-3-1993 and 13-3-1993,

whereby he called upon the respondent to forthwith deposit an amount of Rs. 1,18,22,903.65 and Rs. 73,02,268.20 respectively by way of

Central Excise Duty. In this regard Writ Petition No. 274 of 1993 and 275 of 1993, respectively, were preferred before the learned Single Bench

of this Court, saying that such a demand is unwarranted, it being inoperative and inconsistent with the law as laid down by the Hon'ble Supreme

Court of India in the case of Maharashtra Tubes Ltd. v. State Industrial and Investment Corporation Ltd. reported in 1993 (1) Scale 2.

. On the presentation of the aforesaid two writ petitions the operation of impugned orders was stayed by the learned Single Judge by his order

dated 17-3-1993 and rule nisi was issued.

After objections were filed, the parties were heard and a consent order was passed by the learned Single Judge on 24-5-1993.

Aggrieved of such order the present two Letter Patent Appeals have been preferred on various grounds saying that the learned Single Judge did

not properly appreciate the points raised by the respondents in the writ petition and he did not appreciate the scope of Sick Industrial Companies

(Special Provisions) Act, 1985, and did also not properly follow the law laid down by the Hon'ble Supreme Court of India in the case of

Maharashtra Tubes Ltd. According to the appellants from perusal of the Act and the judgment of the Supreme Court, it becomes manifestly clear

that the said judgment of the Supreme Court has no application on the merits of the case, for in the present case the recovery of Central Excise is

involved; that the learned Single Judge did not give proper weight to the arguments of the appellants; that the industrial unit was not a sick unit, nor

has the same been declared as sick unit by the Board in question. The unit which has been declared as sick unit by the Board was the Holiday

Resort in Pahalgam. The Holiday Resort Unit was a separate unit from the Industrial Units, which was manufactured excisable goods. Both the

units were maintaining separate balance sheets. Besides, various other pleas with regard to the legality of the case have been taken, which need not

require any adjudication in any manner for the fact that the impugned order has been passed on the consent of the parties, and therefore, learned

Counsel for the respondents, Mr. Ramaswamy, raised a preliminary objection to the maintainability of these appeals on the ground that the

impugned oder passed by the learned Single Judge is a consent oder and, therefore, the L.P.As. are not maintainable.

Hence the learned Counsel for the parties, argued the matter regarding the maintainability of these appeals. Mr. Ramaswamy, learned Counsel

for the respondents, has in unequivocal terms argued that the language, import and purport of the order impugned clearly envisaged that the order

passed by the learned Single Judge is a consent order and, therefore, the appeals are not maintainable, for the fact that no appeal would lie against

any order which has been passed on the consent of the parties.

Mr. A.V. Gupta, learned Counsel appearing for the appellants, vehemently, controverted this argument of the learned counsel for the

respondents, saying that the counsel for the parties have only given consent for the disposal of the case and they have not, in any manner, provided

any mode as to in which form the writ petitions could be disposed of by the learned Single Judge. It was argued by Mr. Gupta, that the learned

Single Judge has not considered the legalities of the case raised in the writ petitions and has bypassed all the legalities so raised and passed an

order which is not in accordance with law and is defective.

In this regard it become manifest to read the order impugned in its broader perspective and from the order it is found that the learned Counsel

for the parties have consented to seek the redressal of their grievances by resort to remedy provided under the Sick Industrial Companies (Special

Provisions) Act, 1985 and at their instance the learned Single Judge has observed that if the respondents (the appellants herein) wanted to proceed

with the recovery, they could do so with the consent of the Board and they could also raise the jurisdictional plea before the Board or avail of the

remedy of appeal against the order of the Board. The same would also perhaps hold true for the other side.

The aforesaid observation of the learned Single Judge is indicative of the fact that the parties have desired their grievances to be redressed by

the Board and the appellants were at liberty to proceed with the recovery, but same they could do with the consent of the Board. On their own

choosing, they were also given a choice to raise the jurisdictional plea before the Board or avail of the remedy of appeal against the order of the

Board. Such course of action also holds good for the other side as well. In the circumstances, an opportunity was provided to the parties to move

the Board and seek redressal of their grievances under the provisions of the statute.

Rightly, as argued by Mr. Ramaswamy, the purport and import of the order of the learned Single Judge makes it clear that the parties of their

own choosing and consent had decided that they could get their grievances redressed before the Board and if any of the parties was aggrieved of

the order of the Board, it could move an appeal against the said order of the Board, before a proper forum.

In no manner, any illegality or impropriety has been done by the learned Single Judge in passing the impugned order which has been passed on

the consent of parties. Within the provisions of law and, therefore, it does not lie good for the counsel for the appellants to say that the order of the

learned Single Judge was not a consent order. The propriety of the consent order could not be allowed to be challenged by any of the parties, who

are bound by the consent order, which is in concept and thought passed in accordance with law and does not require any interference.

Hence both the Letters Patent Appeals are dismissed for being not maintainable and sustainable under law, alongwith its connected CMPs.

However, the appellants shall be at liberty to seek clarification from the learned Single Judge also.