2008 (1) TMI 814 - HC - Indian Laws

Stay/Dispensation of pre-deposit - Held that - A plain reading of Section 35 would show that it does not confer any alternative remedy to the petitioner to question the order of the Appellate Tribunal declining the relief to the extent sought for. In such circumstances the power of the court to examine the correctness of the order under Article 226 is always preserved; it is another matter altogether that the court may not chose to exercise the jurisdiction or decline using it after examining the merits. If the order of this court is not reviewed the petitioner would be remediless resulting in the rejection of its appeal for non-payment of the amounts directed. This court is therefore of the opinion that the ends of justice require that the order dated 7-11-2007 is recalled.

Summary

Issues:
1. Recall of order directing writ petition to be treated as an appeal under Section 35 of the Foreign Exchange Management Act.
2. Efficacious alternative remedy by way of appeal under Section 35 of FEMA.
3. Binding nature of counsel's concession on a question of law.
4. Jurisdiction of High Court under Article 226 in the presence of an alternative remedy.
5. Interpretation of Section 35 of FEMA regarding appeal on a question of law.
6. Constitutional validity and wide construction of power under Article 226.

Issue 1: Recall of Order Directing Writ Petition to be Treated as an Appeal
The judgment deals with an application seeking the recall of an order that directed a writ petition to be treated as an appeal under Section 35 of the Foreign Exchange Management Act. The applicants argued that the denial of the relief sought would result in substantial injustice, and they relied on legal precedent to support their position. The court considered the implications of denying the remedy under Article 226 and ultimately recalled the order dated 7th November, 2007, restoring the writ petition to its original position.

Issue 2: Efficacious Alternative Remedy under Section 35 of FEMA
The applicants contended that no efficacious alternative remedy by way of appeal existed under Section 35 of FEMA since the relief sought did not fall under a question of law. They argued that denying the appeal would result in depriving the party of a forum to challenge the order and forfeit its right of appeal. The court analyzed the provisions of Section 35 and concluded that the relief sought did not constitute a question of law, thus justifying the recall of the order directing the writ petition to be treated as an appeal.

Issue 3: Binding Nature of Counsel's Concession on a Question of Law
The judgment discussed the binding nature of counsel's concession on a question of law and emphasized that wrong concessions made by counsel do not bind the parties. The court referred to legal precedents to establish that the scope of a provision of law is determined by its text and court interpretation, not by random concessions made by counsel. The court highlighted that concessions made by counsel do not have precedent value and cannot affect statutory liabilities.

Issue 4: Jurisdiction of High Court under Article 226
The judgment examined the jurisdiction of the High Court under Article 226 in the presence of an alternative remedy provided under Section 35 of the Act. The court emphasized that while alternative remedies exist, the power under Article 226 must not be mechanically rejected. The court asserted that the power under Article 226 is essential for the progressive development of rights and remedies, and any construction limiting this power would be against the spirit of the Constitution.

Issue 5: Interpretation of Section 35 of FEMA
The court interpreted Section 35 of FEMA, which allows an appeal to the High Court on a question of law arising from a decision or order of the Appellate Tribunal. The judgment highlighted that the relief sought by the petitioner did not constitute a question of law eligible for appeal under Section 35. Consequently, the court recalled the order directing the writ petition to be treated as an appeal, preserving the petitioner's right to challenge the order under Article 226.

Issue 6: Constitutional Validity and Wide Construction of Power under Article 226
The judgment emphasized the constitutional validity and wide construction of the power vested in the High Court under Article 226. It underscored that this power cannot be restricted by ordinary legislation and must be given the widest construction to ensure justice. The court cited legal precedents to support the proposition that the courts have discretion to entertain petitions under Article 226 even in the presence of alternative remedies, especially in cases of substantial injustice or exceptional circumstances.