MAHANAGAR TELEPHONE NIGAM LTD. versus CHAIRMAN, CENTRAL BOARD DIRECT TAXES AND ANR.

Citation: [2004] SUPP. 2 S.C.R. 593 · Decided: 07-05-2004 · Supreme Court of India · Bench: S.N. VARIAVA, H.K. SEMA · Disposal: Leave Granted & Disposed off
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Judgment (excerpt)

• 
MAHANA GAR TELEPHONE NIGAM LTD. 
A 
v. 
CHAIRMAN, CENTRAL BOARD DIRECT TAXES AND ANR. 
MAY 7, 2004 
B 
[S.N. VARIAVA AND H.K. SEMA, JJ.] 
Administrative Law : 
Inter-departmental disputes-Dispute between MTNL and CBDT-
MTNL aggrieved by show cause notice issued to it by CBDT-Dispute C 
referred to High Power Committee-Committee directing to await 
appealable order-Committee not permitting to file writ petition in High 
Court-Writ petition filed before High Court-Held, against a show cause 
notice litigation should not be encouraged-Decision of High Power 
Committee merely emphasized the well settled position-It is an eminently D 
fair and correct decision-The purpose of the decision was to prevent 
frivolous litigation-No right of the appellants is being affected-It has 
been clarified that Jhe ap}Jellar;ts could ''niove a court of law against an 
appeqlable order_;By not ''irfaintaining discipline and abiding by the 
decision the appellants have wasted public money and time of the courts- E 
As clearance has not been given to the appellants these proceedings cannot 
be proceeded with-High Court was wrong in dealing with the merits of 
the matter. 
Government Departments-Inter-departmental disputes-Setting up F 
of High Power Committee-Purpose of-Committee not permitting to file 
writ petition-Effect of-The mechanism of setting up of High Power 
Committee to resolve disputes between two departments of the Government 
or between· a department and a Public Sector Undertaking of the 
Government, is not only to conciliqte between the Government departments, 
but is also set up for purposes bf ensuring that frivolous disputes do not G 
come before courts without clearance from High Power Committee-If it 
can, the High Power Committee will resolve the dispute-If the dispute is 
not resolved the Committee would undoubtedly give clearance-However, 
there could also be frivolous /itigation proposed by a department of the 
Government or a Public Sector Undertaking-This could be prevented by H 
593 
594 
SUPREME COURT REPORTS [2004] SUPP. 2 S.C.R. 
A the High Power Committee-In such cases there is no question of resolving 
the dispute-The Committee only has to refase permission to litigate-No 
right of the Department/Public Sector Undertaking is affected in such a 
case-The litigation being of a frivolous nature must not be brought to 
court-Even if the Department/Public Sector Undertakingfinds the decision 
B unpalatable, discipline requires that they abide by it. 
Oil and Natural Gas Commission v. Collector of Central Excise, 
(19951 Supp. 4 SCC 541; Chief Conservator of Forests v. Collector, 
(200313 SCC 472; Canara Bank v. National Thermal Power Corporation, 
C (20011 1 SCC 43 and CCE v. Jeesop and Co. Ltd., (19991 9 SCC 181, 
relied on. 
Oil and Natural Gas Commission v. Collector of Central Excise 
(1994) 70 ELT 45 SC, referred to. 
D 
CIVIL APPELLATE JURISDICTION : Civil Appeal No. 3058 of 
E 
F 
G 
2004. 
From the Judgment and Order dated 24.8.2000 of the Delhi High 
Court in C.W.P. No. 228 of 2000. 
T.R. Andhyarujina and S. Rajappa for the Appellant. 
Mukul Rohatgi, Additional Solicitor General, Sanjiv Sen and B.V. 
Balaram Das for the Respondents. 
The following Order of the Court was delivered: 
Leave granted. 
This Appeal is against the Judgment dated 24th August, 2000. 
Mr. Rohatgi has raised a praliminary objection to the Special Leave 
Petition being proceeded with by this Court. He submits that this Court has, 
in the case of Oil and Natural Gas Commission v. Collector of Central 
Excise reported in, [ 1995] Supp. 4 SCC 541, held that in every case where 
H a dispute is between Government Departments and/or between a Government 
• 
MAHAN AGAR TELEPHONE NIGAM LTD . .-. CHAIRMAN, CENTRAL BOARD DIRECT TAXES 
595 
Department and a Public Sector Undertaking, the matter should be referred A 
to the High Powered Committee established by the Government pursuant 
to an order of this Court dated I Ith September 1991. He pointed out that 
it has been held by this Court that it is the duty of every Court or Tribunal 
to demand clearance from the Committee and that in the absence of 
clearance the proceedings must not be proceeded with. 
B 
Mr. Rohatgi also relied upon the case of C.C.E. v. Jeesop and Co. 
Ltd. reported in, [1999] 9 SCC 181, wherein this Court has again disposed 
of an Appeal filed by the Collector of Central Excise against two public 
sector companies by holding that the course indicated in Oil and Natur
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