1
REPORTABLE
IN THE SUPREME COURT OF INDIA
ORIGINAL CIVIL JURISDICTION
I.A. NO.8 OF 2011
IN
WRIT PETITION (CIVIL) NO.176 OF 2009
Ram Jethmalani & Ors. ... Petitioners
Vs.
Union of India & Ors. ... Respondents
O R D E R
1. Writ Petition (Civil) No.176 of 2009 was filed by Shri
Ram Jethmalani and five others against the Union of India,
the Reserve Bank of India, the Securities Exchange Board of
India, the Director, Directorate of Enforcement and the
Chairman, Central Board of Direct Taxes, Department of
2
Revenue, Ministry of Finance, Government of India, against
the purported inaction of the Government to arrange for
recovery of large sums of money deposited by Indian citizens
in foreign banks and, in particular, in Swiss Banks. In
that context the Petitioners, inter alia, prayed for the
following reliefs :-
"(a) that this Hon'ble Court may be pleased to issue
notice to all the Respondents calling upon them to
disclose all the facts which have come to their
knowledge so far pertaining to the aforementioned
issues and the steps taken by them in this regard;
(b) to make orders from time to time to ensure that the
outcome of the investigations are not suppressed or
even unduly delayed;
(c) the suitable directions be issued to the Respondent
No.1 to apply to the Foreign Banks, more
particularly the UBS Bank for freezing the amounts
in the said foreign banks, particularly, the UBS
Bank which as stated above is holding, inter alia,
the Khan and Tapurias' assets."
2. On 4th July, 2011, on I.A. No.1 of 2009 in the Writ
Petition several directions were given. In fact, the said
order was divided into three parts. The first part of the
order dealt with the alleged failure of the Central
3
Government to recover the large sums of money kept in such
foreign banks and in tax havens having strong secrecy laws
with regard to deposits made by individuals. The second
part dealt with the unlawful activities allegedly funded out
of such deposits and accounts which were a threat to the
security and integrity of India. The amounts deposited in
such tax havens in respect of one Shri Hassan Ali Khan and
Shri Kashinath Tapuria and his wife Chandrika Tapuria were
alleged to be in billions of dollars in UBS Bank in Zurich
alone. Income Tax demands were made to Shri Hassan Ali Khan
for Rs.40,000 crores and a similar demand was served on the
Tapurias amounting to Rs.20,580 crores. On being convinced
that, in the absence of any known source of income, the
large sums of money involved in the various transactions by
Hassan Ali Khan and the Tapurias were the proceeds of crime,
which required a thorough investigation, this Court felt the
necessity of appointing a Special Investigation Team to act
on behalf and at the behest of the directions of this Court.
It was noted by this Court that the issues involved were
complex and would require expertise and knowledge of
4
different departments and the coordination of efforts
between various agencies and departments. It was also
recorded that on behalf of the Union of India, it had been
submitted that a High Level Committee had recently been
formed under the initiative of the Department of Revenue in
the Ministry of Finance, composed of :
(i) Secretary, Department of Revenue, as the Chairman;
(ii) Deputy Governor, Reserve Bank of India;
(iii) Director (IB);
(iv) Director, Enforcement;
(v) Director, CBI;
(vi) Chairman, CBDT;
(vii) DG, Narcotics Control Bureau;
(viii) DG, Revenue Intelligence;
(ix) Director, Financial Intelligence Unit; and
(x) JS(FT & TR-I), CBDT.
with powers to co-pt, as necessary, representatives not
below the rank of Joint Secretary such as the Home
Secretary, Foreign Secretary, Defence Secretary and the
5
Secretary, Cabinet Secretariat. It was further recorded
that the Union of India had claimed that such a multi-
disciplinary group and committee would enable the conducting
of an efficient and a systematic investigation into the
matters concerning allegations against Hassan Ali Khan and
the Tapurias and would also be able to take appropriate
steps to bring back the monies deposited in foreign banks.
In the light of such submission made on behalf of Union of
India and citing the judgments of this Court in (1) Vineet
Narain Vs. Union of India [(1996) 2 SCC 199],(2) NHRC Vs.
State of Gujarat [(2004) 8 SCC 610], (3) Sanjiv Kumar Vs.
State of Haryana [(2005) 5 SCC 517] and (4) Centre for PIL
Vs. Union of India [(2011) 1 SCC 560], this Court completed
the second part of the order by directing as follows :-
49. In light of the above we herewith order:
(i) That the High Level Committee constituted by
the Union of India, comprising of (i)
Secretary, Department of Revenue; (ii) Deputy
Governor, Reserve Bank of India; (iii)
Director (IB); (iv) Director, Enforcement;
(v) Director, CBI; (vi) Chairman, CBDT;
(vii)DG, Narcotics Control Bureau; (vii) DG,
Revenue Intelligence; (ix) Director,
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Financial Intelligence Unit; and (x) JS (FT &
TR-I), CBDT be forthwith appointed with
immediate effect as a special Investigation
Team;
(ii) That the Special Investigation Team, so
constituted, also include Director, Research
and Analysis Wing;
(iii) That the above Special Investigation Team, so
constituted, be headed by and include the
following former eminent judges of this
Court: (a) Hon'ble Mr. Justice B.P. Jeevan
Reddy as Chairman; and (b) Hon'ble Mr.
Justice M.B. Shah as Vice-Chairman; and that
the Special Investigation Team function under
their guidance and direction;
(iv) That the Special Investigation Team, so
constituted, shall be charged with the
responsibilities and duties of
investigation, initiation of proceedings, and
prosecution, whether in the context of
appropriate criminal or civil proceedings
of: (a) all issues relating to the matters
concerning and arising from unaccounted
monies of Hassan Ali Khan and the Tapurias;
(b) all other investigations already
commenced and are pending, or awaiting to be
initiated, with respect to any other known
instances of the stashing of unaccounted
monies in foreign bank accounts by Indians or
other entities operating in India; and (c)
all other matters with respect to
unaccounted monies being stashed in foreign
banks by Indians or other entities operating
in India that may arise in the course of
such investigations and proceedings. It is
clarified here that within the ambit of
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responsibilities described above, also lie
the responsibilities to ensure that the
matters are also investigated, proceedings
initiated and prosecutions conducted with
regard to criminality and/or unlawfulness of
activities that may have been the source
for such monies, as well as the criminal
and/or unlawful means that are used to take
such unaccounted monies out of and/or
bring such monies back into the country, and
use of such monies in India or abroad.
The Special Investigation Team shall also be
charged with the responsibility of preparing
a comprehensive action plan, including the
creation of necessary institutional
structures that can enable and strengthen the
country's battle against generation of
unaccounted monies, and their stashing away
in foreign banks or in various forms
domestically.
(v) That the Special Investigation Team so
constituted report and be responsible to this
Court, and that it shall be charged with the
duty to keep this Court informed of all major
developments by the filing of periodic status
reports, and following of any special orders
that this Court may issue from time to time;
(vi) That all organs, agencies, departments and
agents of the State, whether at the level of
the Union of India, or the State
Government, including but not limited
to all statutorily formed individual bodies,
and other constitutional bodies, extend all
the cooperation necessary for the Special
Investigation Team so constituted and
functioning;
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(vii) That the Union of India, and where needed
even the State Governments, are directed to
facilitate the conduct of the investigations,
in their fullest measure, by the Special
Investigation Team so constituted and
functioning, by extending all the necessary
financial, material, legal, diplomatic and
intelligence resources, whether such
investigations or portions of such
investigations occur inside the country or
abroad.
(viii) That the Special Investigation Team also be
empowered to further investigate even where
charge-sheets have been previously filed; and
that the Special Investigation Team may
register further cases, and conduct
appropriate investigations and initiate
proceedings, for the purpose of bringing back
unaccounted monies unlawfully kept in bank
accounts abroad.
3. The third part of the order deals with the disclosure of
various documents referred to by the Union of India in
relation to the names and particulars of various bank
accounts of Indian citizens in the Principality of
Liechtenstein, a small landlocked sovereign nation-state in
Europe, which is generally acknowledged as a tax haven.
4. The third part of the order is not of relevance at this
stage, since an application, being IA No.8 of 2011, has been
9
filed by the Union of India in the Writ Petition, purporting
to be an application under Article 142 of the Constitution
read with Order 47 Rule 6 of the Supreme Court Rules, 1966,
seeking modification of the aforesaid order dated 4th July,
2011.
5. Before the Application could be moved by the learned
Attorney General, Mr. Anil B. Divan, learned Senior Advocate
appearing for the Writ Petitioners, took a preliminary
objection that the interlocutory application was not
maintainable on several counts. It was firstly urged that
in effect, in the guise of an application for modification,
the Respondents/Applicants were wanting either a re-hearing
and/or review of the order passed on 4th July, 2011,
disposing of I.A.No.1 of 2009. Mr. Divan pointed out that
it was the Government itself which had set up a High Level
Committee consisting of senior officers of different
departments to take steps for retrieving the black money
which had been deposited in banks in tax havens all over the
world and, in particular, in Swiss Banks and it did not,
10
therefore, lie in the mouth of the Government to take a
different stand when the same Committee had been converted
into a Special Investigation Team with two former Judges of
the Supreme Court to monitor the progress of the recovery
proceedings.
6. Mr. Divan also contended that the formation of a Special
Investigation Team to monitor the investigation is not a new
concept and has been resorted to on different occasions in
order that justice is done between the parties and the rule
of law is not obstructed either by the investigating agency
or otherwise. Mr. Divan urged that once the matter had been
decided on merits and a direction had been given for the
formation of a Special Investigation Team composed of the
very officers who had been appointed as members of the High
Level Committee for the very same purpose, the Government is
not justified in objecting to the investigation being
monitored by such Committee headed by two retired Judges of
the Supreme Court with impeccable credentials. Mr. Divan
submitted that the contention of the Respondents in I.A.
11
No.8 of 2011 was as if by appointing a Special Investigation
Team, the Supreme Court had taken over the executive powers
of the Union. It was submitted that although a case
against the accused was pending since 2007, no attempt had
been made to interrogate the accused in regard to the
allegations made against them.
7. Mr. Divan submitted that possibly other fora were
available to the Respondents, but the present I.A. would not
provide any remedy to the Respondents. Mr. Divan urged that
it was on account of the complete inertia of the
investigating authority that in spite of huge sums of
unaccounted money deposited in tax havens abroad, little or
no action was taken to proceed with the investigation or
even to interrogate the persons accused of having been
involved in money laundering and acting against the
interests of the country and its citizens. Mr. Divan
submitted that the remedy available to the Respondents lay
in a review petition under the provisions of Order 47 of the
12
Supreme Court Rules, 1966, and not by an interlocutory
application and that too in a disposed of matter.
8. Mr. Shekhar Naphade, learned Senior Advocate who
appeared for the Petitioner in Writ Petition (Civil) No.136
of 2011, supported the submissions made by Mr. Anil Divan
with regard to the maintainability of the Interlocutory
Application No.8 of 2011 filed by the Union of India. It
was contended that neither the provisions of Article 142 of
the Constitution nor Order 47 Rule 6 of the Supreme Court
Rules were attracted in the facts of this case, inasmuch as,
the said provisions conferred power and not jurisdiction on
this Court in respect of a matter which was pending before
it. Mr. Naphade submitted that Article 142 very clearly
vested the Supreme Court with jurisdiction to pass such
decree or make such order as is necessary for doing complete
justice in any case or matter pending before it. Mr.
Naphade also contended that, as had been held by this Court,
in Saurav Chaudhary Vs. Union of India [(2004) 5 SCC 618],
this Court could exercise its jurisdiction under Article 142
13
of the Constitution at the time of rendition of the judgment
and not thereafter. It was further observed that once
judgment had been delivered by the Court, it could not
recall the same and could only exercise its power of review
in case it intended to take a different view from the one
rendered in the main judgment. Mr. Naphade also urged that
even the provisions of Order 47 Rule 6 of the Supreme Court
Rules were of no assistance to the Union of India. It was
submitted that the Rules framed under Article 145(1) of the
Constitution only empowered the Supreme Court to frame Rules
to regulate its practice and procedure and does not take in
its sweep the power to create a new jurisdiction to
entertain a cause or matter.
9. Reference was also made to the decision of this Court in
Raja Soap Factory & Ors. Vs. S.P. Shantharaj & Ors.[(1965) 2
SCR 800], wherein it was observed that by jurisdiction what
is meant is the extent of power which is conferred upon a
Court by its Constitution to try a matter or a cause. Such
14
power is not capable of being enlarged because an
extraordinary situation requires the Court to exercise it.
10. Mr. Naphade submitted that by virtue of this
application, the Union of India was seeking to review a
final order passed by this Court, treating the same to be an
application for recalling the order. Mr. Naphade repeated
and reiterated his submissions that the application filed on
behalf of the Union of India and its authorities was not
maintainable and could only be dismissed.
11. Replying to the submissions made by Mr. Divan and Mr.
Naphade, the learned Attorney General submitted that in
earlier cases also this question had been raised and
considered by this Court. Referring to the decision of a
Bench of Seven Judges in the case of A.R. Antulay Vs. R.S.
Nayak & Anr. [(1988) 2 SCC 602], the learned Attorney
General submitted that by a majority judgment this Court
held that directions, if given in violation of the
principles of natural justice, if subsequently questioned in
another appeal instead of by way of a Review Petition under
15
Article 137, the same could be set aside by another Bench of
the Court ex debito justitiae in exercise of its inherent
powers. The majority amongst the Judges held that the want
of jurisdiction could be addressed solely by a superior
Court and, in practice, no decision could be reviewed
collaterally by any inferior Court, but the superior Court
could always correct its error either by way of a petition
or ex debito justitiae. In fact, it was also observed that
in certain situations, the Supreme Court could always invoke
its power of review in exercise of its inherent jurisdiction
in any proceeding pending before it, without insisting on
the formalities of a review application. The learned
Attorney General submitted that by appointing two retired
Judges of the Supreme Court, Justice B.P. Jeevan Reddy as
the Chairman and Justice M.B. Shah as the Vice-Chairman, and
directing that the Special Investigation Team would function
under their guidance and directions, would amount to
interference with the executive authority of the different
officials representing different sections of the
administration which would lead to a chaotic situation. The
16
direction given to include the Director, Research & Analysis
Wing, was also improper, since the said authority functioned
under strict rules of secrecy, which could be jeopardized if
its Director were to be included in the Special
Investigation Team.
12. The learned Attorney General submitted that, in the
event there was any doubt as to whether the powers of the
Supreme Court under Article 142 of the Constitution could be
invoked for doing complete justice in a matter which was not
pending before it, the present application could always be
treated as a Review Petition under Article 137 of the
Constitution read with Order 47 Rule 6 of the Supreme Court
Rules, 1966. The learned Attorney General submitted that in
view of the magnitude of the transactions involved and that
too without any accounting of the monies used, this Court
should cut across technicalities and consider the matter
pragmatically. The learned Attorney General submitted that
the present application may, therefore, be treated as a
Review Petition under Article 137 of the Constitution read
17
with Order 47 Rule 6 of the Supreme Court Rules, 1966 and be
proceeded with accordingly, notwithstanding the objection
taken on behalf of the Petitioners in regard to the
different procedure to be adopted in respect of a review
application. It was also submitted that as indicated in
A.R. Antulay's case (supra), the Supreme Court can grant
relief in exercise of its inherent powers as the guardian of
the Constitution.
13. Reference was also made by the learned Attorney General
to the decision of this Court in S. Nagaraj & Ors. Vs. State
of Karnataka & Anr. [(1993) Supp. (4) SCC 595], which was
heard along with several other cases by a Bench of three
Judges. In the said cases an order had been passed on oral
mentioning which ultimately resulted in several contempt
petitions being filed. Two of the Hon'ble Judges, after
considering the anomalous circumstances which had resulted
from the passing of the order on oral mentioning, held that
justice is a virtue which transcends all barriers and
neither the rules of procedure nor technicalities of law can
18
stand in its way. It was further observed that the order of
the Court should not be prejudicial to anyone and if the
Court found that the order was passed under a mistake and it
would not have exercised the jurisdiction, but for the
erroneous assumption which in fact did not exist, and its
perpetration would result in miscarriage of justice, then it
would not on any principle be precluded from rectifying the
order. Mistake is accepted as a valid reason to recall an
order. Their Lordships emphasized the fact that
rectification of an order stems from the fundamental
principles that justice is above all. It is exercised to
remove the error and not for disturbing finality. In the
judgment it was also observed that the Supreme Court has the
inherent power to make such orders as may be necessary for
the interest of justice or to prevent the abuse of process
of Court. The Court is, therefore, not precluded from
recalling or reviewing its own order, if it is satisfied
that it is necessary to do so for the sake of justice. It
was pointed out that even the learned third Judge held that
while the Government was mainly responsible for the
19
unfortunate state of affairs that should not desist the
Supreme Court from revising or reviewing the said orders
which had serious consequences. The learned third Judge
also observed that it is the duty of the Court to rectify,
revise and recall its orders as and when it is brought to
its notice that certain of its orders were passed on a wrong
or mistaken assumption of facts and that implementation of
those orders will have serious consequences.
14. On a careful consideration of the submissions made on
behalf of the respective parties in regard to the
maintainability of I.A. No.8 of 2011 filed on behalf of the
Union of India, wherein, inter alia, a prayer has been made
to modify the order dated 4th July, 2011 and to delete the
directions relating to the Special Investigation Team in
paragraphs 49 and 50 of the said order, it appears that the
I.A. is maintainable. In view of the preliminary objection
relating to the maintainability of the interlocutory
application filed on behalf of the Union of India, the said
20
issue regarding the maintainability of I.A. No.8 of 2011 has
been taken up first.
15. From the arguments advanced on behalf of the respective
parties, it appears at first blush that Mr. Anil B. Divan is
technically correct in submitting that since there was no
matter pending before this Court, the provisions of Article
142 of the Constitution would not be attracted and that even
the inherent powers of this Court preserved under Order 47
Rule 6 of the Rules framed by the Supreme Court in exercise
of its powers under Article 145 of the Constitution would
not be applicable. However, this Court has preserved its
inherent powers to make such orders as may be necessary for
the ends of justice in Order 47 Rule 6 of the Supreme Court
Rules, 1966, framed under Article 145 of the Constitution.
As has been held in A.R. Antulay's case (supra) and in S.
Nagaraj's case (supra), such a power was not only inherent
in the Supreme Court, but the Supreme Court was also
entitled to and under an obligation to do justice to
exercise such powers as the guardian of the Constitution.
21
Justice transcends all barriers and neither rules of
procedure nor technicalities can stand in its way,
particularly if its implementation would result in
injustice. In addition to the decision rendered by this
Court in A.R. Antulay's case (supra) and in S. Nagaraj's
case (supra), reference may also be made to another equally
important pronouncement of this Court in Vineet Narain's
case (supra), wherein the concept of continuing mandamus was
introduced in order to maintain the credibility of the
investigation being conducted.
16. Reference may also be made to the decision of this Court
in Manganese Ore (India) Ltd. Vs. Chandi Lal Saha [(1991)
Supp. 2 SCC 465], wherein this Court extended the benefit of
its judgment to persons who were not even in appeal before
it.
17. Even if the present application was to be dismissed as
being not maintainable under Article 142 of the Constitution
read with Order 47 Rule 6 of the Supreme Court Rules, 1966,
it would not preclude the Applicants from filing an
22
application for review under Article 137 of the
Constitution. As the very working of the Special
Investigation Team appointed under the order of 4th July,
2011, is in question, it is necessary to cut across the
technical tapes sought to be invoked on behalf of the
Petitioners and hold that in view of the inherent powers
vested in the Supreme Court of India, preserved in Order 47
Rule 6 of the Supreme Court Rules, 1966, and having regard
to the fact that the Supreme Court is the guardian of the
Constitution, I.A. No.8 of 2011, even in its present form is
maintainable in the facts and circumstances of the case,
which include threats to the security of the country.
18. The objections raised by Mr. Anil B. Divan and supported
by Mr. Shekhar Naphade, regarding the maintainability of
I.A. No.8 of 2011, are, therefore, rejected and the said
application may therefore be proceeded with for hearing.
............................................................J.
(ALTAMAS KABIR)
New Delhi,
Dated: 23.09.2011.
23
REPORTABLE
IN THE SUPREME COURT OF INDIA
CIVIL ORIGINAL JURISDICTION
I.A. NO.8 OF 2011
IN
WRIT PETITION (CIVIL) NO.176 OF 2009
RAM JETHMALANI & ORS. ....PETITIONERS
VERSUS
UNION OF INDIA & ORS. ....RESPONDENTS
O R D E R
1. I have had the opportunity, and the benefit of reading, in draft, the
learned opinion of Hon'ble Mr. Justice Altamas Kabir. However, with
all humility and with due respect, I would not be able to concur with the
24
view taken by my Learned Brother. My Learned Brother has rejected
the preliminary objections raised by Mr. Anil Divan and Mr. Shekhar
Naphade, appearing for the writ petitioners and directed the application
to proceed for hearing. In my opinion, the application is not
maintainable for a number of reasons.
2. The application clearly states that the order passed by this Court in
I.A. No. 1 on 4th July, 2011 impinges upon the doctrine of separation of
powers. The application thereafter sets out the facts leading to the filing
of the writ petition invoking Article 32 of the Constitution of India. The
application sets out the prayers made in the writ petition. Thereafter, it is
stated that the writ petition, as originally filed, did not contain any prayer
for appointment of a Special Investigation Team. The application also
points out that in the counter affidavit filed on behalf of the Union of
India, it had been clearly stated that the Central Government had been
alive to the need to be able to retrieve information about the alleged
money lying deposited in the foreign accounts and highlighting steps
25
taken by it in his behalf. It further points out that it was on account of
such an initiative, tax haven countries, including countries like
Switzerland, made solemn attempts to enter into effective tax
information exchange agreements with various countries. The
application proceeds to delineate the steps taken and the strategy
formulated to eradicate the menace of "Black Money". It states that the
Government had joined the global crusade against Black Money. It had
decided to create an appropriate legislative framework by incorporating
various tax evasion measures in existing Acts. Thereafter, the
application gives the details of the proposed new legislation for
unearthing Black Money. After enumerating all the efforts made by the
Government at national and international level, it is stated that above all
the Government has constituted a Committee on 27th May, 2011 under
the Chairman, C.B.D.T. to examine ways to strengthen laws to stop the
generation of Black Money in the country, its legal transfer abroad and
its recovery. The Committee also examined various other issues which
are enumerated in the application. The application further proceeds to
26
tabulate the efforts to create further legislative and administrative
framework to obtain information about illicit money of Indian citizens
already parked outside the country. Thereafter, the application sets out
the efforts already made and the results thereof. On the basis of that, it is
stated that the Government has achieved substantial success not only in
getting information on illicit money parked outside the country but also
in stopping the transfer of illicit money outside the country. Thereafter,
the details are given of the illicit money detected.
3. It is stated that in the order dated 4th July, 2011, these efforts have
neither been adverted to nor evaluated before rendering the finding in
Paragraph 46 of the judgment.
4. The application thereafter sets out various efforts made in the
matter of investigation of the case of Hasan Ali Khan and Kashinath
Tapuriah. The application thereafter reproduces the directions sought in
I.A. No.1 of 2009, which was filed on 8th September, 2009. Thereafter, it
is submitted that even in this application, no prayer was made for
27
appointment of a Special Investigation Team [SIT]. It is further
submitted that such a prayer ought not to have been granted on the basis
of written submissions of the learned counsel for the petitioners in the
absence of requisite pleadings in the writ petition or in the absence of a
formal prayer. The application further proceeds to state that it is filed
invoking the inherent power of this Court under Article 142(1) of the
Constitution of India for doing complete justice in any case or matter
pending before it.
5. In the grounds of the application, it is stated that this Court while
exercising its jurisdiction would not be pleased to attain to itself, the task
entrusted to the executive. It is emphatically submitted in the application
that the order is without jurisdiction since the constitution of the High
Level Committee is within the realm of a decision on policy matters. It is
also submitted that formation of a SIT headed by two former Judges of
this Court not only impinges on the policy decision of the Government
but also impinges upon the doctrine of separation of powers. This,
28
according to the application, would be beyond the jurisdiction conferred
on this Court under Article 32 of the Constitution of India, which can
be exercised for the enforcement of the rights conferred by Part III and
for no other purpose. It is further submitted that the judgment proceeds
on admissions, concessions, submissions and acknowledgments
attributed to the counsel appearing for the Union of India. It is pointed
out that such concessions and admissions do not appear to have been
made. On the basis of the facts pleaded, the prayer is made for
modification of the order dated 4th July, 2011 and deletion of the
directions relating to SIT in Paragraphs 49 and 50. Since the directions
given in these paragraphs have been reproduced verbatim by His
Lordship, Justice Kabir, the same are not necessary to be reproduced
herein again.
6. The aforesaid facts have been stated merely to indicate that the
application would not be maintainable, in its present form, as in
substance, it is more in the nature of a Memorandum of Appeal. In my
29
opinion, the application seeks to reopen the whole matter on merits
which would not be permissible in an application for modification.
Therefore, in my opinion, the application deserves to be dismissed at the
threshold.
7. As the submissions made by the learned counsel for the parties
have been succinctly noticed by my Learned Brother Altamas Kabir, J.
in His Lordship's order, the same need not be repeated herein.
8. In my opinion, an application for clarification/modification
touching the merits of the matter is not maintainable. The Court can
consider the matter, if at all, only upon a review application on limited
grounds. In considering the application for review, the procedure laid
down under Order XL of the Supreme Court Rules, 1966 read with
Article 137 would have to be followed. Review of a judgment is a
serious matter and is, therefore, governed by constitutional and statutory
provisions. This view of mine will find support from a number of earlier
30
decisions of this Court. It would, at this stage, be appropriate to make a
reference to some of the observations made.
9. In the case of Ram Chandra Singh Vs. Savit
ri Devi & Ors.1 this
Court considered the issue as to whether an application for
clarification/modification would be maintainable in the face of the
provisions contained in Article 137 and Order XL Rule 1 of Supreme
Court Rules. Upon consideration of the entire issue, it was observed as
follows:-
"It is now well settled that an application for
clarification or modification touching the merit of the
matter would not be maintainable. A Court can rehear
the matter upon review of its judgment but, therefore, the
procedure laid down in Order 40 Rules 3 and 5 of the
Supreme Court Rules, 1966 as also Article 137 of the
Constitution are required to be complied with as review
of a judgment is governed by the constitutional as well as
statutory provisions.
...........................................................................
......................................................... " The prayer
of the applicant is that apart from the corrections which
are required to be made in the judgment, as noticed
hereinbefore, the merit of the matter may also be
considered, inter alia, with reference to the pleadings of
1 2004 (12) SCC 713
31
the parties. Such a course of action, in our opinion, is
not contemplated in law. If there exist errors apparent on
the face of the record, an application for review would
be maintainable but an application for clarification
and/or modification cannot be entertained unless it is
shown that the same is necessary in the interest of
justice. An application which is in effect and substance
an application for review cannot be entertained dehors
the statutory embargo contained in Order 40 Rules 3 and
5 of the Supreme Court Rules, 1966."
10. I am of the considered opinion that the present application would
be an abuse of the process of the Court as it seeks to camouflage an
application for Review as an application for modification. In my
opinion, such a course ought not to be encouraged. It would be relevant
to notice the observations made by this Court in paragraph 16 of the
judgment in the case of Delhi Administration Vs. Gurdip Singh Uban
& O
rs.2 .
"16. At the outset, we have to refer to the practice of filing
review applications in large numbers in undeserving cases
without properly examining whether the cases strictly
come within the narrow confines of Rule XL of the
Supreme Court Rules. In several cases, it has become
almost everyday experience that review applications are
filed mechanically as a matter of routine and the grounds
for review are a mere reproduction of the grounds of
2 2000 (7) SCC 296
32
special leave and there is no indication as to which ground
strictly falls within the narrow limits of Rule XL of the
Rules. We seriously deprecate this practice. If parties file
review petitions indiscriminately, the time of the Court is
unnecessarily wasted, even it be in chambers where the
review petitions are listed. Greater care, seriousness and
restraint is needed in filing review applications."
11. In my opinion, ten years down the line, the situation is even worst
than what is depicted by the aforesaid observations. Now we are facing
an almost daily practice of having to consider applications for
"modification and clarification".
12. In the aforesaid judgment, this Court also considered the nature
and scope of the jurisdiction to review its own order/judgment. Since the
application herein has been described as an application for
"modification", it would be necessary to notice the observations made by
this Court in Paragraph 17 and 18 of the judgment. The observations of
this Court are as under:-
"17. We next come to applications described as
applications for "clarification", "modification" or
"recall" of judgments or orders finally passed. We may
point out that under the relevant Rule XL of the Supreme
33
Court Rules, 1966 a review application has first to go
before the learned Judges in circulation and it will be for
the Court to consider whether the application is to be
rejected without giving an oral hearing or whether notice
is to be issued.
Order XL Rule 3 states as follows:
"3. Unless otherwise ordered by the Court, an application
for review shall be disposed of by circulation without any
oral arguments, but the petitioner may supplement his
petition by additional written arguments. The Court may
either dismiss the petition or direct notice to the opposite
party...."
In case notice is issued, the review petition will be listed
for hearing, after notice is served. This procedure is meant
to save the time of the Court and to preclude frivolous
review petitions being filed and heard in open court.
However, with a view to avoid this procedure of "no
hearing", we find that sometimes applications are filed for
"clarification", "modification" or "recall" etc. not
because any such clarification, modification is indeed
necessary but because the applicant in reality wants a
review and also wants a hearing, thus avoiding listing of
the same in chambers by way of circulation. Such
applications, if they are in substance review applications,
deserve to be rejected straight away inasmuch as the
attempt is obviously to bypass Order XL Rule 3 relating to
circulation of the application in chambers for
consideration without oral hearing. By describing an
application as one for "clarification" or "modification",
-- though it is really one of review -- a party cannot be
permitted to circumvent or bypass the circulation
procedure and indirectly obtain a hearing in the open
Court. What cannot be done directly cannot be permitted
34
to be done indirectly. (See in this connection a detailed
order of the then Registrar of this Court in Sone Lal v.
State of U.P deprecating a similar practice.)
18. We, therefore, agree with the learned Solicitor
General that the Court should not permit hearing of such
an application for "clarification", "modification" or
"recall" if the application is in substance one for review.
In that event, the Court could either reject the application
straight away with or without costs or permit withdrawal
with leave to file a review application to be listed initially
in chambers."
13. These observations leave no manner of doubt that the Court should
not permit hearing of such an application for "clarification",
"modification" or "recall" if the application is in substance one for
review. It is clearly indicated that in those circumstances the Court could
either reject the application straight away or permit withdrawal with
leave to file a review application to be listed initially in chambers.
14. Examined on the touch stone of the observations made above, I am
of the considered opinion that the application herein though described as
an application for modification is in substance more in the nature of a
35
Memorandum of Appeal. At best, it could be said to be in substance an
Application for Review. It certainly does not lie within the very narrow
limits within which this Court would entertain an application for
modification.
15. In yet another case of Zahira Habibullah Sheikh & Anr. Vs.
State
of Gujarat & Ors.3 this Court, faced with a similar situation, had
this to say :
"The petition is in essence and substance seeking for a
review under the guise of making an application for
direction and modification apparently being fully aware
of the normal procedure that such applications for
review are not, unless the Court directs, listed for open
hearing in Court, at the initial stage at least, before
ordering notice to the other side and could be summarily
rejected, if found to be of no prima facie merit. The move
adopted in itself is unjustified, and could not be
countenanced also either by way of review or in the form
of the present application as well. The nature of relief
sought, and the reasons assigned are such that even
under the pretext of filing a review such an exercise
cannot be undertaken, virtually for rehearing and
alteration of the judgment because it is not to the liking
of the party, when there is no apparent error on record
whatsoever to call for even a review. The said move is
clearly misconceived and nothing but sheer abuse of
process, which of late is found to be on the increase,
more for selfish reasons than to further or strengthen the
3 (2004 (5) SCC 353)
36
cause of justice. The device thus adopted, being
otherwise an impermissible move by mere change in
nomenclature of the applications does not change the
basic nature of the petition. Wishful thinking virtually
based on surmises too, at any rate is no justification to
adopt such undesirable practices. If at all, it should be
for weighty and substantial reasons and not to exhibit the
might or weight or even the affluence of the party
concerned or those who represent such parties when they
happen to be public authorities and institutions.
16. This Court approved the observations made in the case of Gurdip
Singh Uban (supra) and observed that what cannot be done directly
cannot be permitted to be done indirectly. The Court should not permit
hearing of such an application for "clarification", "modification" or
"recall" if the application is in substance a clever move for review.
17. These observations were reiterated in the case of A.P. SRTC &
Ors. Vs. Abdul Kareem 4. This Court observed that the petition was in
essence and substance seeking for a review under the guise of making an
application for direction and modification apparently being fully aware
of the normal procedure that such applications for review are not, unless
4 2007 (2) SCC 466
37
the Court directs, listed for open hearing in Court, at the initial stage at
least, before ordering notice to the other side and could be summarily
rejected, if found to be of no prima facie merit. The Court further
observed that such a move ought not to be countenanced. The move was
clearly misconceived and nothing but sheer abuse of process, which of
late is found to be on the increase, more for selfish reasons than to
further or strengthen the cause of justice.
18. To be fair, it must be noticed that the learned Attorney General
appearing for the Union of India had relied on a number of judgments in
support of his submissions that the Court would have inherent powers to
modify its own order/judgment. The primary judgment relied upon by
the learned Attorney General is in the case of S. Nagaraj & Ors. Vs.
State of Karnataka & Anr.5. I am of the considered opinion that the
aforesaid judgment would be of no assistance to the submissions made
by the learned Attorney General. The aforesaid judgment was rendered
in the background of very peculiar facts. It would appear that this Court
5 1993 (Supp.4) SCC 595
38
had passed an order having far reaching consequences and pre-judicially
affecting the rights of other groups of employees under Articles 14
and 16 of the Constitution of India. The order had permitted backdoor
entry of thousands of stipendiary graduates because of the negligence of
the State in putting correct facts before the Court. The Government
seemed to have woken up after considerable damage had already been
done and moved an application for modification/clarification of the order
dated 30th October, 1991. The learned Attorney General placed strong
reliance on the observations made by this Court in Paragraph 18, 19 and
36 of the judgment in support of the submission that the Court should not
decline to review its orders when it is brought to the notice of the Court
that it would be in the interest of justice to modify the same. In order to
appreciate the submission of learned Attorney General, it would be
appropriate to notice the observations made by this Court in Paragraphs
18, 19 and 36 of the judgment, which are as under:-
"18. Justice is a virtue which transcends all barriers.
Neither the rules of procedure nor technicalities of law
can stand in its way. The order of the Court should not
be prejudicial to anyone. Rule of stare decisis is adhered
39
for consistency but it is not as inflexible in
Administrative Law as in Public Law. Even the law
bends before justice. Entire concept of writ jurisdiction
exercised by the higher courts is founded on equity and
fairness. If the Court finds that the order was passed
under a mistake and it would not have exercised the
jurisdiction but for the erroneous assumption which in
fact did not exist and its perpetration shall result in
miscarriage of justice then it cannot on any principle be
precluded from rectifying the error. Mistake is accepted
as valid reason to recall an order. Difference lies in the
nature of mistake and scope of rectification, depending
on if it is of fact or law. But the root from which the
power flows is the anxiety to avoid injustice. It is either
statutory or inherent. The latter is available where the
mistake is of the Court. In Administrative Law the scope
is still wider. Technicalities apart if the Court is satisfied
of the injustice then it is its constitutional and legal
obligation to set it right by recalling its order. Here as
explained, the Bench of which one of us (Sahai, J.) was a
member did commit an error in placing all the
stipendiary graduates in the scale of First Division
Assistants due to State's failure to bring correct facts on
record. But that obviously cannot stand in the way of the
Court correcting its mistake. Such inequitable
consequences as have surfaced now due to vague
affidavit filed by the State cannot be permitted to
continue.
19. Review literally and even judicially means re-
examination or re-consideration. Basic philosophy
inherent in it is the universal acceptance of human
fallibility. Yet in the realm of law the courts and even the
statutes lean strongly in favour of finality of decision
legally and properly made. Exceptions both statutorily
and judicially have been carved out to correct accidental
40
mistakes or miscarriage of justice. Even when there was
no statutory provision and no rules were framed by the
highest court indicating the circumstances in which it
could rectify its order the courts culled out such power to
avoid abuse of process or miscarriage of justice. In Raja
Prithwi Chand Lal Choudhury v. Sukhraj Rai the Court
observed that even though no rules had been framed
permitting the highest Court to review its order yet it was
available on the limited and narrow ground developed
by the Privy Council and the House of Lords. The Court
approved the principle laid down by the Privy Council in
Rajunder Narain Rae v. Bijai Govind Singh that an order
made by the Court was final and could not be altered:
"... nevertheless, if by misprision in
embodying the judgments, by errors have
been introduced, these Courts possess, by
Common law, the same power which the
Courts of record and statute have of
rectifying the mistakes which have crept in ....
The House of Lords exercises a similar power
of rectifying mistakes made in drawing up its
own judgments, and this Court must possess
the same authority. The Lords have however
gone a step further, and have corrected
mistakes introduced through inadvertence in
the details of judgments; or have supplied
manifest defects in order to enable the
decrees to be enforced, or have added
explanatory matter, or have reconciled
inconsistencies."
Basis for exercise of the power was stated in the same
decision as under:
"It is impossible to doubt that the indulgence
extended in such cases is mainly owing to the
natural desire prevailing to prevent
41
irremediable injustice being done by a Court
of last resort, where by some accident,
without any blame, the party has not been
heard and an order has been inadvertently
made as if the party had been heard."
Rectification of an order thus stems from the
fundamental principle that justice is above all. It is
exercised to remove the error and not for disturbing
finality. When the Constitution was framed the
substantive power to rectify or recall the order passed by
this Court was specifically provided by Article 137 of the
Constitution. Our Constitution-makers who had the
practical wisdom to visualise the efficacy of such
provision expressly conferred the substantive power to
review any judgment or order by Article 137 of the
Constitution. And clause (c) of Article 145 permitted this
Court to frame rules as to the conditions subject to which
any judgment or order may be reviewed. In exercise of
this power Order XL had been framed empowering this
Court to review an order in civil proceedings on grounds
analogous to Order XLVII Rule 1 of the Civil Procedure
Code. The expression, `for any other sufficient reason' in
the clause has been given an expanded meaning and a
decree or order passed under misapprehension of true
state of circumstances has been held to be sufficient
ground to exercise the power. Apart from Order XL Rule
1 of the Supreme Court Rules this Court has the inherent
power to make such orders as may be necessary in the
interest of justice or to prevent the abuse of process of
Court. The Court is thus not precluded from recalling or
reviewing its own order if it is satisfied that it is
necessary to do so for sake of justice.
36. There is yet another circumstance. The question is,
whether this Court should enforce the 1982 Rules as
42
amended in 1987. The 1987 amendments have the effect
of smuggling in thousands of persons into Government
service by a back-door -- without complying with the
requirements of Articles 14 and 16. One can understand
the rules as framed in 1982, but it is extremely difficult to
appreciate or understand the reasons for which the 1987
amendment was brought in. The question, to repeat, is
whether this Court should extend its arm -- its
discretionary power under Articles 136 and 32, as the
case may be, to implement such unconstitutional rules
and help these persons to gain a back-door entry into
Government service -- that too at the highest level in
group `C' services straightaway. It is true that no one
has questioned the 1987 amendments. The petitioners do
not question them because they are advantageous to
them; they want them to be implemented. The
Government cannot and does not question them because
it has itself made them. The parties who are affected
namely the persons awaiting employment under the
Government probably do not even know what is
happening. But where an unconstitutional provision of
such vast impact is brought to the notice of this Court
and it is asked to enforce it, it is the constitutional duty of
this Court to refuse to do so. I am, therefore, of the firm
opinion that this Court should refuse to make any orders
directing implementation of the rules as amended in
1987. The proper direction would be to direct the
absorption of the S.Gs. in accordance with the 1982
Rules as originally framed (i.e., without reference to the
1987 amendments) and to the extent provided therein. Of
course those S.Gs. who have been absorbed already into
group `C' service in accordance with the said rules will
remain unaffected since disturbing them, without notice
to them and in view of all the circumstances of this
case, may not be advisable. All those S.Gs. who have
not so far been absorbed in group `C' service shall
43
continue in the present status, drawing Rs 960 per
month. They will be entitled for absorption in group
`C' posts only in accordance with the 1982 Rules,
without reference to the 1987 amendments."
Relying on these observations, learned Attorney General, submits that
the Court should regardless of any technical objections proceed to hear
the present application without insisting that the applicant should seek its
relief in an application for review.
19. I am of the considered opinion that the facts and circumstances
highlighted in the present application would not enable the applicant to
satisfy the conditions under which this Court exercised its inherent
jurisdiction in the S. Nagaraj's case (supra). A perusal of the judgment
would clearly show that the Court was anxious to "even the balance".
On the one side, there were orders of the Court passed on vague and
incomplete affidavit, creating rights and hopes in favour of five thousand
stipendiary graduates to be absorbed as First Division Assistant, and on
the other hand, there were others, the likely injustice to whom had been
highlighted in the affidavit filed by the Government and in the writ
44
petition filed by different sections of the employees. The Court in fact
emphasised the principle of finality of orders and binding nature of
directions issued by the Court which could only be overridden, if there is
injustice inherent in the situation (see Page 615, Para 14 e & f). A little
later in the judgment, in Paragraph 16, the Court observed as follows:-
"16. "Mere eligibility was not sufficient unless
availability of posts was also established. In absence of
posts and due to equitable considerations arising in
favour of other employees the practical difficulty in
appointing all the five thousand stipendiary graduates as
First Division Assistants appears to be insurmountable.
Even so we have no hesitation in saying that we would
have refused to modify our order dated October 30,
1991 at the instance of the Government but the Court
cannot
be unjust to other employees." (emphasis
supplied)
20. These observations make it abundantly clear that the Court was
dealing with a particularly unsavory situation created by the Government
which had led to insurmountable difficulties and possible injustice to
both the stipendiary Magistrates and other employees. The Court,
therefore, observed that but for this unique situation, it would have
refused to modify the order dated 30th October, 1991. In Paragraph 18,
45
the Court makes it clear that the order was passed under a mistake. The
Court would not have exercised its jurisdiction but for the erroneous
assumption, which in fact did not exist. In Paragraph 36, again, it is
reiterated by the Court that it would be the duty of the Court to rectify,
revise and recall its orders as and when it is brought to its notice and
certain of its orders were based on wrong or mistaken assumption of
facts and that implementation of those orders would have serious
consequences.
21. In my opinion, in the present case, there is no question of mistaken
facts, being presented by anyone to the Court. The application also fails
to indicate any miscarriage of justice or injustice which would be caused
to any particular class. The other authorities cited by the learned
Attorney General followed the judgment in S. Nagaraj's case (supra)
and would not advance the cause of the applicant or Union of India any
further.
46
22. The judgment in Gurdip Singh Uban's case (supra) rather
supports the writ petitioner as noticed in the earlier part of this order.
The learned Attorney General further submitted that this Court would be
fully justified in passing the orders in exercise of its inherent jurisdiction
under Article 142 of the Constitution of India. It can always correct its
non errors brought to its notice either by way of a review petition or ex
debito justitiae. In support of the submission, the learned Attorney
general has relied on judgment of this Court in the case of A.R. Antulay
Vs. R.S.
Nayak & Anr.6
23. In my opinion, the aforesaid judgment was also delivered in view
of the peculiar circumstances of the case. The Court therein set out the
circumstances in which this Court can pass the appropriate orders
unhindered by technical rules. The observations made in paragraph 48,
which are of relevance, are as under :
"48. According to Shri Jethmalani, the doctrine of per
incuriam has no application in the same proceedings. We
are unable to accept this contention. We are of the opinion
6 1988 (2) SCC 602
47
that this Court is not powerless to correct its error which
has the effect of depriving a citizen of his fundamental
rights and more so, the right to life and liberty. It can do
so in exercise of its inherent jurisdiction in any proceeding
pending before it without insisting on the formalities of a
review application. Powers of review can be exercised in a
petition filed under Article 136 or Article 32 or under any
other provision of the Constitution if the court is satisfied
that its directions have resulted in the deprivation of the
fundamental rights of a citizen or any legal right of the
petitioner. See the observations in Prem Chand Garg v.
Excise Commissioner."
24. In my opinion, the aforesaid observations would not be applicable
in the facts and circumstances of the present case. The application herein
is not moved by an individual, who had been deprived of his
fundamental rights by an order dated 4th July, 2011. The application is
filed by the Union of India challenging the order on various legal and
factual issues. In Antulay's case (supra), one of the grounds taken was
that the directions have been issued by the Court without following the
principle of audi alteram partem. In the present case, the directions had
been issued after hearing the learned counsel for the parties at length and
on numerous dates. These directions, in my opinion, cannot be recalled
48
in an application seeking only modification of the order. At this stage, it
would also not be possible to treat the present application for
modification as an application for review.
25. In view of the above, with utmost respect, it would not be possible
to agree with the order passed by Hon'ble Mr. Justice Altamas Kabir. In
my opinion, the applicant Union of India has failed to make out a case to
enable this Court to treat the modification application as application for
review and proceed to hear the same in open Court. In my opinion, the
present application is wholly misconceived. It is, therefore, dismissed.
Union of India is, however, at liberty to take recourse to any other legal
remedy that may be available to it.
...................................J.
[Surinder Singh Nijjar]
New Delhi;
September 23, 2011.
49
REPORTABLE
IN THE SUPREME COURT OF INDIA
CIVIL ORIGINAL JURISDICTION
I.A. NO.8 OF 2011
IN
WRIT PETITION (CIVIL) NO.176 OF 2009
RAM JETHMALANI & ORS. Petitioner(s)
VERSUS
UNION OF INDIA & ORS. Respondent(s)
O R D E R
Since we have differed in our views regarding the
maintainability of I.A. No.8 of 2011 filed in W.P. No.176
of 2009, let the matter be placed before Hon'ble the Chief
Justice of India, for reference to a third Judge.
......................J.
(ALTAMAS KABIR)
......................J.
(SURINDER SINGH NIJJAR)
New Delhi;
September 23, 2011.
