2015 (5) TMI 257 - HC - Customs

A writ of Mandamus by an informer of the Customs Department - Release of balance amount of reward amount due - Reward is purely an ex-gratia payment - Ex-gratia payment has to be paid in consonance with the guidelines and the scheme dated 16th April, 2004 framed by the Government of India - The informer cannot be left to the whims and caprices and /or mercy of the Respondents and/or the members of the Reward Committee - Held that - In the present case, the Petitioner on 19th July, 2010 had provided a specific information pertaining to five containers which were lying in the port and based on the said information seizure was effected by the Respondent authorities. The show cause notice dated 3rd December, 2010 also in unequivocal terms mentions that Specific information was received by the officers of Central Intelligence Unit about a party by name M/s. Limra Traders with respect to the five containers, numbers of which are undoubtedly tallying with the numbers provided by the informer/ Petitioner in firstly, the gist of the information given to Mr. Rakesh Kumar Gaur, Superintendent of Customs (CIU) and subsequently in the information report dated 19th July, 2010. The show cause notice also makes specific reference that on investigation it is found that the said containers have been imported on Bill of Lading No.859498700 showing the goods as Welded Mesh and under its garb consumer items were imported thereby causing substantial and huge loss of revenue to the Government of India. We are of the opinion that, the Customs officers at this stage cannot be allowed to take a spacious plea that they were already in receipt of the information since January 2010 and therefore, the Petitioner is not entitled for further reward amount. It is to be noted here that on the basis of the specific information provided by the Petitioner, the Respondent authorities were able to recover an amount of ₹ 2,65,26,500/- by auctioning the confiscated goods. According to us and in our considered opinion, the stand taken by the Respondent authorities appears to be clearly an afterthought, taken only with a view to deprive the informer / Petitioner from his legitimate dues / payments towards his reward as per the reward policy. We may also note here that the affidavit dated 15th March, 2014 filed by the Deputy Commissioner of Customs is as vague as possible and it appears to us that the said authority is either suppressing certain vital information from this Court and / or has filed the said affidavit without perusing the entire original record available with its office. As far as the contention raised by the Deputy Commissioner of Customs in his affidavit at paragraph No.7 that the reward is purely ex-gratia payment which may be granted on absolute discretion of the authority competent to grant reward and no party can claim the reward as a matter of right, we are of the considered opinion that though, paragraph 5 of the said policy dated 16th April, 2004 mentions that the reward is purely an ex-gratia payment and cannot be claimed by anyone as a matter of right, the ex-gratia payment has to be paid in consonance with the guidelines and the scheme dated 16th April, 2004 framed by the Government of India and the informer cannot be left to the whims and caprices and /or mercy of the Respondents and/or the members of the Reward Committee. It is manifest that the informers provide information with a legitimate expectation of reward to be received in time. Non-payment of the reward amount within a stipulated time will have frustrating effect on the reward policy framed by the Government of India which may perhaps result in not getting the information of the unscrupulous and anti-social elements and thereby would cause loss to the government exchequer. We are of the considered opinion that the guidelines enunciated in the reward policy dated 16th April, 2004 are to be adhered to, by all the concerned and the discretion as mentioned in paragraph 5 of the said policy, given to the Reward Committee, cannot be treated as an unfettered power with the authority competent to grant rewards, which may lead to frustrate the basic intention of the Government behind framing the policy. - Decided in favour of appellant.

Summary

Issues Involved:
1. Entitlement to balance reward amount for the Petitioner.
2. Legitimacy of the Respondent's actions in withholding the reward.
3. Interpretation and application of the Reward Policy dated 16th April 2004.

Analysis of the Judgment:

Entitlement to Balance Reward Amount for the Petitioner
The Petitioner, an informer for the Customs Department, sought a writ of Mandamus directing the Respondents to release the balance reward amount due to him. The Petitioner provided specific information about goods imported illegally, leading to the seizure and confiscation of these goods. The Petitioner contended that despite the seizure and subsequent revenue generation for the government, he was only paid an advance reward of Rs. 5 lacs, with the balance reward still pending.

Legitimacy of the Respondent's Actions in Withholding the Reward
The Respondents argued that the Petitioner could not claim the reward as a matter of right, citing paragraph 5 of the Reward Scheme, which states that the reward is purely ex gratia and subject to the discretion of the authority. They also mentioned that the Reward Committee had not favored further reward due to an ongoing Directorate of Vigilance enquiry, which has since concluded.

Interpretation and Application of the Reward Policy Dated 16th April 2004
The court examined the Reward Policy and found that the Petitioner had provided specific information leading to the seizure of goods and subsequent revenue generation of Rs. 2,65,26,500/- from auctioning the confiscated goods. The court noted that the information provided by the Petitioner was crucial and led to the successful seizure, contradicting the Respondent's claim of prior information from January 2010.

The court criticized the Respondents for their delay in acting on the alleged prior information and emphasized that the Petitioner's information was the basis for the successful seizure. The court also highlighted the importance of adhering to the Reward Policy to encourage informers to come forward with valuable information.

The court referenced a similar case (Lalan Kishor Singh v. State of Maharashtra) where the importance of timely rewarding informers was emphasized to avoid dissuading potential informers from providing information.

Conclusion
The court concluded that the Petitioner's claim for the balance reward was legitimate and that the Respondent's actions appeared to be an afterthought to deprive the Petitioner of his rightful reward. The court directed the Respondents to pay the Petitioner the reward as per the Policy of Reward for Informers & Officers dated 16th April 2004, within three months, after adjusting the amount already paid.