2023 (9) TMI 1652 - HC - Indian Laws

Maintainability of petition - petitioner is entitled to the return of the bank guarantee and the undertaking of the directors as per the previous court order or not - HELD THAT - The petition would become infructuous in view of the letter dated 01.09.2023 and the affidavit cum-undertaking shall also cease to operate. The petition is accordingly disposed of.

Summary

1. ISSUES PRESENTED and CONSIDERED

The core legal questions presented and considered in this judgment are:

• Whether the petitioner is entitled to the return of the bank guarantee and the undertaking of the directors as per the previous court order.
• Whether the petition becomes infructuous due to the respondent's decision to release the bank guarantee.

2. ISSUE-WISE DETAILED ANALYSIS

Issue 1: Entitlement to Return of Bank Guarantee and Directors' Undertaking

• Relevant Legal Framework and Precedents: The petitioner filed the petition under Article 226 of the Constitution of India, seeking a writ of mandamus for the return of the bank guarantee and the directors' undertaking. The legal framework involves the enforcement of court orders and the conditions under which bank guarantees are held or released.
• Court's Interpretation and Reasoning: The court considered the previous order dated 23.02.2022, which required the petitioner to furnish a bank guarantee and the directors to submit an undertaking. The court noted that these conditions were set to ensure compliance with potential liabilities.
• Key Evidence and Findings: The court referenced a letter dated 01.09.2023 from the Additional Commissioner (AF), CGST Gandhinagar, indicating the decision to release the bank guarantee, which was a pivotal piece of evidence in determining the petition's current status.
• Application of Law to Facts: The court applied the principles of compliance with court orders and the subsequent actions taken by the respondent to release the bank guarantee. It assessed whether the conditions for holding the guarantee were still applicable.
• Treatment of Competing Arguments: The court did not elaborate on competing arguments, as the respondent's letter effectively resolved the primary issue of the bank guarantee's release, rendering the petition moot.
• Conclusions: The court concluded that the petition had become infructuous due to the respondent's decision to release the bank guarantee, and as a result, the affidavit cum-undertaking ceased to operate.

Issue 2: Infructuous Nature of the Petition

• Relevant Legal Framework and Precedents: The legal principle of a petition becoming infructuous applies when the relief sought has already been granted or the circumstances have changed, rendering the petition unnecessary.
• Court's Interpretation and Reasoning: The court reasoned that since the respondent had agreed to release the bank guarantee, the primary relief sought by the petitioner was effectively granted, making further judicial intervention unnecessary.
• Key Evidence and Findings: The letter from the Additional Commissioner (AF), CGST Gandhinagar, served as the key evidence that led to the determination that the petition was infructuous.
• Application of Law to Facts: The court applied the principle that a petition becomes infructuous when the relief sought is no longer required due to subsequent developments or actions by the parties involved.
• Treatment of Competing Arguments: The court did not address competing arguments in detail, as the resolution of the primary issue by the respondent's action precluded the need for further deliberation.
• Conclusions: The petition was disposed of as infructuous, with the court acknowledging that the affidavit cum-undertaking would also cease to operate.

3. SIGNIFICANT HOLDINGS

• Preserve Verbatim Quotes of Crucial Legal Reasoning: "Considering the above facts, the petition would become infructuous in view of the letter dated 01.09.2023 and the affidavit cum-undertaking shall also cease to operate."
• Core Principles Established: The judgment reinforces the principle that a petition under Article 226 becomes infructuous when the relief sought is rendered unnecessary by subsequent actions or developments.
• Final Determinations on Each Issue: The court determined that the petition was infructuous due to the respondent's decision to release the bank guarantee, and therefore, the petition was disposed of.