Uniroyal Textile Industries Ltd. Vs. Commissioner of Customs, Group V-a, Air Cargo - Court Judgment

Excerpt:
- administrative law - government contract: [vijender jain, c.j., rajive bhalla & sury kant, jj] government contract rejection of highest bid challenge as to held, state has no dominus status to dictate unilateral terms and conditions when it enters into contract. its actions must be reasonable, fair and just in consonance with rule of law. as a necessary corollary thereto, state cannot refuse to confirm highest bid without assigning any valid reason and/or by giving erratic, irrational or irrelevant reasons. the state is free to enter into a contract just like any other individual and the contract shall not change its legal character merely because other party to contract is state. though no citizen possesses a legal right to compel state to enter into a contract, yet latter can neither pick and choose any person arbitrarily for entering into such agreement nor can it discriminate between persons similarly circumstanced. similarly, where breach of contract at hands of state violates fundamental rights of a citizen or its refusal to enter into a contract is contrary to statutory provisions or public duty, judicial review of such state action is inevitable. likewise, if state enters into a contract in consonance with article 299 rights of the parties shall be determined by terms of such contract irrespective of fact that one of the parties to it is a state or a statutory authority. for these precise reasons the equitable doctrine of promissory estoppel has been made applicable against the government, as against any other private individual, even in cases where no valid contract in terms of article 299 was entered into between the parties. hence, if government makes a representation or a promise and an individual alters his position by acting upon such promise, the government may be required to make good that promise and shall not be allowed to fall back upon the formal defect in the contract, though subject to well known limitations like larger public interest. the state, thus, has no dominus status to dictate unilateral terms and conditions when it enters into contract and its actions must be reasonable, fair and just and in consonance with rule of law. as a necessary corollary thereto state cannot refuse to confirm highest bid without assigning any valid reason and/or by giving erratic, irrational or irrelevant reasons. -- consumer protection act, 1986 [c.a. no. 68/1986]. articles 14 & 300a: government contract noon-acceptance of highest bid held, it does not result in taking away right to property of highest bidder highest bid, per se, unless it is accepted by competent authority, and consequential sale certificate is issued, does not grant the highest bidder right to property of type which is protected under article 300a right to property is limited to confer highest bidder the right to challenge action of appropriate authority in refusing to accept highest or other bids. [air 1984 p&h 282 (fb) explained] articles 14 & 226: government contract rejection of highest bid held, highest bidder has locus standi to maintain writ petition and assail action of state government or its authorities by contending that his bid has been turned down for arbitrary, illegal or perverse reasons however in such matters, heavy onus would like on petitioner bidder to establish his allegations as state action shall always be presumed to be in accordance with law - he has further contended that even the show cause notice should be treated beyond a period of six months, as no notice under section 28 of the act could be issued to the appellant after expiry of a period of six months from the date of passing the order by the authority as envisaged under section 128 of the act and in the present case a show cause notice having been issued on 30.3.1999 against the assessment of duty on 11.9.1998, the same was clearly time barred, there being no allegation of fraud etc. 3. when the communication itself mentioned that the same was an order against which an appeal will lie to the next appellate authority and even the period of appeal as well as details regarding court fee and the requirement of pre- deposit were also mentioned therein, still to say that the communication sent to the appellant was not an order is totally misconceived. admittedly, the order was received by the appellant on 11.7.2000 and appeal against the same was filed by the appellant on 14.2.2001, which was clearly delayed.rajesh bindal, j.1. the appellant has approached this court against the order passed by the customs, excise and service tax appellate tribunal, new delhi (for short 'the tribunal'), dated 24.2.2005 raising eight substantial questions of law. as is evident from order dated 11.7.2006 the appeal was confined to proposed question nos. (iii) and (v), which are extracted below:iii) whether, the impugned letter dated 30.6.2000 issued by the ld. deputy commissioner of customs air cargo, new delhi to the appellant can be said to be a 'decision or order' passed within the meaning of section 28, 128 and 130 of the customs act, 1962 v) whether the order dated 29.9.2003 passed in appeal under section 128 of the customs act, 1962 against the impugned letter dated 30.6.2000 issued/passed by deputy commissioner of customs, new delhi holding the appeal to be barred by limitation and thus not maintaining is liable to be set aside 2. on first question, the contention of the appellant is that a communication dated 30.6.2000 sent by the deputy commissioner (customs) to the appellant raising a demand of rs. 8,02,967/- on account of duty was not in the form of an order passed within the meaning of sections 128 and 130 of the customs act, 1962 (for short 'the act'). according to him, in this communication neither any reason has been recorded nor any plea raised by the appellant has been dealt with, hence, the same cannot be termed as a reasoned order. he has further contended that even the show cause notice should be treated beyond a period of six months, as no notice under section 28 of the act could be issued to the appellant after expiry of a period of six months from the date of passing the order by the authority as envisaged under section 128 of the act and in the present case a show cause notice having been issued on 30.3.1999 against the assessment of duty on 11.9.1998, the same was clearly time barred, there being no allegation of fraud etc. against the appellant. further it is submitted after receipt of communication dated 30.06.2000, the appellant had been representing before the authority for affording him personal hearing. on the other hand, counsel for the respondent relied upon a judgment of hon'ble the supreme court in lajya dyeing & bleaching works v. union of india : [2003]263itr763(sc) , wherein a communication addressed to the assessee therein mentioning the details of duty already paid and which was required to be paid, determined after hearing the assessee therein, was held to be an order. a perusal of order dated 30.6.2000, which according to the appellant was not an order, shows that the same itself provided towards the end of the order that an appeal from this order lies to the appellate commissioner of customs. the relevant part thereof is extracted below:an appeal against this order lies to the appellate commissioner of customs, within three months from the date of receipt of this letter, as prescribed under section 128 of the said act and it should bear a court fee stamp of fifty paisa. the amount of duty as stated above shall have to be deposited under section 128 of the said act before the appeal is entertained. 3. when the communication itself mentioned that the same was an order against which an appeal will lie to the next appellate authority and even the period of appeal as well as details regarding court fee and the requirement of pre- deposit were also mentioned therein, still to say that the communication sent to the appellant was not an order is totally misconceived. 4. further it is not disputed by the appellant that before passing the order the appellant was given due opportunity in the form of show cause notice to which the appellant had filed reply also. accordingly, we do not find any merit in this contention of the appellant. as far as second issue is concerned, as per the provisions of section 128 of the act, the appeal could be filed against the order of the deputy commissioner (customs) to the appellate commissioner of customs within three months from the date of receipt thereof. admittedly, the order was received by the appellant on 11.7.2000 and appeal against the same was filed by the appellant on 14.2.2001, which was clearly delayed. as far as the period of limitation is concerned, section 128 of the act provides that in case there is a delay in filing of appeal, the same can be condoned to the extent of further three months. further from a perusal of order of the commissioner (appeals) it is evident that sufficient reason was not shown by the appellant for filing the appeal late. in the absence thereof, the authorities were not wrong in not condoning the delay in filing the appeal. 5. accordingly, we do not find any merit in the appeal, the same is dismissed.