Delta Distilleries Limited Versus United Spirits Limited & Anr. SUPREME COURT OF INDIA

IN THE SUPREME COURT OF INDIA CIVIL APPELLATE JURISDICTION
CIVIL APPEAL NO. 8426 OF 2013
out of SPECIAL LEAVE PETITION (CIVIL) NO. 28418/2012 )
Delta Distilleries Limited                                                        … Petitioner

Versus

United Spirits Limited & Anr.                                                …Respondents

J U D G E M E N T

H.L. Gokhale J.

Leave Granted.
2. This appeal by Special Leave seeks to challenge
the judgment and order dated 20.7.2012 rendered by a
Single Judge of Bombay High Court allowing Arbitration
Petition No.838 of 2011 filed by the respondent No.1 herein.
The said petition sought to invoke the powers of the court
under Section 27 of the Arbitration and Conciliation Act, 1996
(herein after referred to as the Act of 1996), which provides
for seeking assistance of the court in taking evidence. The
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said petition had been moved in pursuance of the order
dated 16.9.2011 passed by a three member Arbitral Tribunal
permitting the respondent No.1 to file such an application.
The learned Single Judge allowed the said petition, and
thereby directed the appellant to produce the documents as
sought by the respondent No.1 before the Arbitral Tribunal.
This appeal has been filed by Special Leave to challenge the
said judgment and order. The appeal raises the question with
respect to the scope of Section 27, and the circumstances in
which the Arbitral Tribunal or a party before the Arbitral
Tribunal can apply to the court for assistance in taking
evidence.
Facts leading to this appeal are this wise:-
3. The respondent No.1 herein is a company which
owns certain brands of Indian Made Foreign Liquor (IMFL).
The appellant is a company carrying on the business of
distilling and bottling of IMFL. The predecessor of the
respondent No.1 entered into an agreement with the
appellant on 25.3.1997, under which the appellant agreed to
manufacture and supply to the respondent No.1, IMFL of such
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brands and quantity, as would be specified from time to time
on the terms and conditions contained therein. Under the
said agreement, the contract price at which the IMFL was to
be sold by the appellant to the respondent No.1, was
exclusive of sales tax and other taxes, and the respondent
No.1 was required to bear the same.
4. It appears that sometimes in 2001-2002, certain
disputes arose between the parties. A major dispute
between them related to the outstanding amount payable at
the foot of the running account between them. The
respondent No.1 claimed that amongst others, amounts to
the tune of Rs.1,22,30,692 and Rs.70,23,107.52 were due
and payable to the respondent No.1, whereas the appellant
maintained that an amount of Rs.39,37,993 was payable to
the appellant. According to the first respondent, the appellant
had obtained from the Sales Tax Department set-off/refund
on the sales tax paid on packaging material, and such setoff/refund
operated to reduce the sales tax liability of the
appellant, which was ultimately being borne by the
respondent No.1. The respondent No.1 therefore, claimed
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that it was entitled to the benefit of the said set-off/refund,
and accordingly debited the appellant for the amount of setoff/refund.
5. It was the case of the first respondent that
although the appellant had accounted for some of these
entries in its accounts, it did not account for a major portion
of the same. Clause 14 of the agreement between the
parties provided that any dispute or difference arising or
relating to or connected with the said agreement, was to be
referred to arbitration. The above dispute was, therefore,
referred to the Arbitration of Hon’ble Mr. Justice D.M. Rege,
former Judge of Bombay High Court. However, the Learned
Judge resigned as arbitrator, and thereafter the proceedings
were continued before another arbitrator Hon’ble Mrs. Justice
Sujata Manohar, former Judge of the Supreme Court of India.
6. Thereafter, the advocates of the respondent No.1
gave a notice to the advocate on record of the appellant on
17.3.2007, calling upon them to give inspection and to
produce the following documents before the learned
Arbitrator:-
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(a) All sales tax returns filed by the appellant with the sales
tax authorities for the assessment years 1995-1996 to 2001-
2002.
(b) All sales tax assessment orders passed with regard to
the appellant for the above-mentioned period, and all
appellate orders, if any passed in any appellate proceedings
arising out of the same.
(c) The objection, if any, filed by the appellants against the
Notice in Form 40, and proposed order at pages 123 & 124 of
Volume VI of the documents filed in the arbitration, the order,
if any, passed thereon, and the appellate proceedings, if any,
therein.
(d) The letter dated 26th May 2000 mentioned in the letter
at page 32 of Volume III of the documents filed in the
arbitration.
7. The advocate of the appellant vide his reply dated
21.3.2008, protested and objected to the production of these
documents, since according to the appellant the same were
being sought at a late stage when the proceeding had
reached the stage of cross-examination of the witnesses of
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the respondent No.1. In paragraph 3 of this reply the learned
advocate stated as follows:-
“3. As regards the inspection of
documents sought by your clients, my clients
repeat that your clients are not entitled to
inspection of any documents at this belated
stage. In any event, my clients are not
relying on any of the documents referred to
in paragraphs (a), (b) and (c) of your letter.
As regards the documents referred to in
paragraph (d) of your letter, the said
document is already on record before the
Hon’ble Arbitrator and hence a copy of the
said document is already available with you.”
8. Inasmuch as the appellant declined to give
inspection / and produce the document as sought for, the
respondent No. 1 made an application on 26.3.2007 before
the learned Arbitrator, and in paragraph No. 5 thereof, sought
a direction to produce the documents mentioned at Sl. Nos.
(a) to (c) in the notice dated 17.3.2007. The learned
Arbitrator by her order dated 27.3.2007 allowed the
application only to the extent of the assessment orders
relating to the period 1995-1996 to 2001-2002 and the
appellate orders mentioned in paragraph 5(b). The prayer for
producing the sales tax returns mentioned in paragraph 5(a)
was not entertained. Similarly, the prayer to produce the
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documents as sought in paragraph 5(c) was not entertained.
The learned Arbitrator held in paragraph 4 of her order as
follows:-
“4. …. The documents in paragraphs 5
(a) and 5 (b) relate to Sales Tax Returns filed
by the Respondents for Assessment Years
1995-1996 till 2001-2002 and Sales Tax
Assessment Orders passed in respect of the
Respondents for this period including any
Appellate Orders. One of the claims made by
the Claimants in these proceedings against
the Respondents related to the benefit of any
sales tax set-off granted to the Respondents
in connection with the goods in question
which, according to the Claimants, should
accrue to their benefit. Therefore, Sales Tax
Assessment Orders relating to the period in
dispute passed in respect of the Respondents
are relevant for the purpose of determination
of this aspect of the dispute. Mr. Savant,
learned counsel for the Respondents has
contended that these Sales Tax Assessments
are not relevant because in any case, the
Claimants have quantified the set-off which
they are claiming, and hence, it is not
necessary to look at Sales Tax Assessments
to ascertain the quantum of set-off.
However, the quantification is done by the
Claimants on the theoretical basis that full
set-off must have been granted to the
Respondents and hence, 75% of the value of
the set-off until May 2000 and the full value
of such set-off thereafter should be
considered as having accrued for the benefit
of the Claimants. A hypothetical calculation
on such basis should not be resorted to when
actual Sales Tax Assessments are available
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which show the quantum of set-off allowed.
This is in the interest of both the parties.
Hence, the argument of Mr. Savant cannot be
accepted.”
9. The appellants were dissatisfied with the order
passed. In their subsequent correspondence they made
certain allegations against the learned Arbitrator, who
therefore, resigned from the said proceeding. The parties
therefore, appointed an Arbitral Tribunal consisting of three
Judges, Hon’ble Mr. Justice M. Jagannadha Rao (Presiding
Arbitrator) and Hon’ble Mr. Justice S.N. Variava (both former
Judges of the Supreme Court of India), and Hon’ble Mr. Justice
M.S. Rane (Former Judge of Bombay High Court). On
reconstitution of the Arbitral Tribunal the respondent No.1
pointed out that the order passed by the earlier Arbitrator
dated 27.3.2007 had not been complied with. The Tribunal,
therefore, called upon the appellant to state their position on
an affidavit. Thereupon the Chairman of the appellant filed
an affidavit before the Tribunal on 16.9.2011 stating that the
appellant would not produce the sales tax assessment
orders. In paragraph 3 of his affidavit he specifically stated
as follows:-
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“3. I humbly and most respectfully
submit before this Hon’ble Tribunal that,
Sales Tax Returns are the documents which
are highly confidential and hence the same
cannot be subject matter to be produced
before this Hon’ble Tribunal especially when,
sales tax set off is already quantified by the
Claimants and the same is forming a part of
their claim in the present arbitration
proceedings. I say that, it is not necessary to
inspect the said sales tax assessment orders
in order to ascertain the quantum of set off. I
say that, the Claimants’ demand of sales tax
set off to an extent of 75% and somewhere
also 100% is completely vague and arbitrary
and that the same is completely de hors the
contents of the agreement dated 25.03.1997.
I therefore say that, disclosure of any such
sales tax assessment orders shall be
completely detrimental to the rights and
interest of the Respondent Company.”
10. In view of this affidavit of the Chairman of the
appellant, the Tribunal noted that the party in possession of
the concerned documents was refusing to produce them,
even though it had been directed to do so. The Tribunal vide
its order dated 16.9.2011, held that the earlier order dated
27.3.2007 passed by the previous arbitrator could not be
reviewed, nor did the Tribunal have any jurisdiction to do so.
The Tribunal, therefore, permitted the respondent No.1 to
apply to the court under Section 27 of the Act of 1996, and to
seek production of the sales tax assessment order for the
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period 1995-1996 to 2001-2002, including any appellate
orders in support thereof. The Tribunal observed as follows:-
“7.……One would have expected the
Respondent to obey the directions of this
Tribunal and produce the above said
documents. However, in as much as they
have not been produced for more than four
years and now there is categorical statement
by the Chairman of the Respondent Company
that they will not produce these documents,
the Tribunal is compelled to exercise the
powers under Section 27 of the Act and grant
permission to the Claimant to apply to the
Court for production of the documents from
the Respondent and/or the Sales Tax
Authorities……”
11. Pursuant to the said permission granted by the
Tribunal, the respondent No.1 filed the Arbitration Petition
before the Single Judge of Bombay High Court invoking the
powers of the Court under Section 27 of the Act of 1996, to
seek a direction to the appellants to produce the earlier
mentioned assessment orders and appellate orders. The
Assistant Commissioner of Sales Tax, Pune was joined as
respondent No. 2, and a direction to produce those
documents from his records was as well sought. The
appellant herein, opposed the said Arbitration Petition. Now
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for the first time, in paragraphs 5 and 6 of the reply the
appellants stated as follows:-
“5. The Petitioner’s demand pertains to
records for the period 1995-1996 to 2001-02.
I say and submit that these are very old
records. The same are not available with the
Respondent No. 1. I say and submit that
Respondent No. 1 is not able to trace these
old records. I say that in fact when I made
my Affidavit dated 16th September, 2011, I
had in fact not searched the Company’s
records to ascertain whether the sales tax
orders were in fact available with it. I say
that accordingly I had made the said Affidavit
dated 16th September, 2011 opposing the
disclosure on the grounds stated therein. I
say that during the pendency of the present
petition, I have checked in order to ascertain
whether these records were in fact available
with the Company and have discovered that
they cannot be traced.”
6. Without prejudice to the aforesaid, I
further say that the information that is being
requested for by the petitioner is confidential
and accordingly the same ought not be
disclosed.”
12. The learned Single Judge thereupon heard the
parties. It was submitted on behalf of the appellant before
the Learned Single Judge, that the provisions of Section 27 of
the Act of 1996 were analogous to Section 43 of the
Arbitration Act, 1940. A judgment of the Delhi High Court in
the case of Union of India v. Bhatia Tanning Industries
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reported in AIR 1986 Delhi 195, on the said Section 43 was
relied upon to submit that the said section applies only to
calling witnesses, and not for giving any direction to the
parties. It was further submitted that at the highest, an
adverse inference may be drawn against the appellant under
Order 21, Rule 11 of Code of Civil Procedure (hereinafter
referred as CPC). Reliance was also placed on the provision
of Section 71 of Maharashtra Value Added Tax Act, 2002
(hereinafter referred as the Maharashtra Act) which is pari
materia with Section 64 of the Bombay Sales Tax Act, 1959,
and it was contended that the assessment orders were
confidential, and could not be directed to be produced. The
Assistant Commissioner of Sales Tax who was respondent
No.2 to the Writ Petition (and who is respondent No. 2 to this
appeal also), submitted that the old record of the relevant
period was not available with the Sales Tax Department, and
was already destroyed. In any case it was submitted that in
view of the above referred Section 71, such a direction could
not be issued.
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13. The learned Judge repelled all these arguments.
He held that the appellant was misreading the judgment of
Delhi High Court, and that it could not be anybody’s case that
a party in a proceeding can not be examined as a witness.
With respect to Section 71 of the Maharashtra Act, the
learned Judge held that it barred only the production of
statements and returns, and it was not applicable to the
assessment orders. The learned Judge also noted that in the
earlier affidavit filed before the Tribunal, the appellant had
not taken any such plea that the assessment orders were not
available, but within ten months thereafter in another
affidavit before the High Court it was being contended that
the said documents were not traceable. The learned Judge
therefore, allowed the said petition invoking Section 27 of the
Act of 1996, and directed the appellant herein to produce the
documents sought for. Being aggrieved by this judgment and
order the present SLP has been filed.
14. We have heard Mr. Ravindra Srivastava, learned
senior counsel in support of this appeal, and Mr. Chander
Uday Singh, learned senior counsel for the respondent no. 1.
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Respondent no. 2 is a proforma respondent. The challenge in
this appeal is principally on two grounds. Firstly, that the
type of order which was sought under Section 27 of the Act of
1996, against the appellant was not within the competence of
the court, and at the highest the Arbitral Tribunal should
have drawn an adverse inference against the appellant under
Order 11 and Rule 21 of CPC for non-production of the
documents, the production of which was sought by the
respondent no.1. The second challenge was that in any case,
the documents which were sought were confidential
documents, and in view of the provision contained in Section
71 of the Maharashtra Value Added Tax 2002, and the order
compelling the appellant to produce such documents could
not have been passed.
15. As far as the first ground of challenge is
concerned, as pointed out earlier, reliance was placed by
the respondent no. 1 on the judgment of a Division Bench of
Delhi High Court in Bhatia Tanning Industries (supra).
Now, what had happened in this matter was that the
respondent/industries were to supply certain material to the
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appellant, and since the respondent had committed default
in making the supply, the appellant had raised a claim on
account of risk purchase which was referred to arbitration.
The arbitrator sent notices to the address of the
respondents on record twice, and on both occasions the
registered notices were returned to the arbitrator stating
that the addressee was not available. It was in these
circumstances that the arbitrator ordered that there shall be
a publication of the notice in a newspaper. That having
being done, nobody appeared for the respondent thereafter
also, and the arbitrator made an ex-parte award. After the
award was filed in court, and notice was sent to the
respondent, an objection was raised that the arbitrator had
no power to order service by means of publication in the
newspaper. The learned Single Judge who heard the matter,
set aside the award on the ground that the arbitrator should
have gone to the court under Section 43 of the Arbitration
Act, 1940 (Act of 1940 for short), and obtained an order
from the Court for service by publication which had not
been done.
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16. This order was challenged in appeal, and a
Division Bench of the High Court allowed the said appeal.
The Division Bench held that the there are two separate
sections in the Act of 1940. One was Section 42 which
provided service of notice by a party or arbitrator, and the
other was Section 43. Section 43 of the Act of 1940 reads
as follows:-
“43. Power of Court to issue
processes for appearance before
arbitrator – (1) The Court shall issue the
same processes to the parties and witnesses
whom the arbitrator or umpire desires to
examine as the Court may issue in suits tried
before it.
(2) Person failing to attend in
accordance with such process, or making any
other default, or refusing to give their
evidence, or guilty of any contempt to the
arbitrator or umpire during the investigation
of the reference, shall be subject to the like
disadvantages, penalties and punishments by
order of the Court on the representation of
the arbitrator or umpire as they would incur
for the like offences in suits tried before the
Court
(3) In this section the expression
“processes” includes summonses and
commissions for the examination of
witnesses and summonses to produce
documents.”
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The Division Bench in paragraph 9 of its judgment noted
that Section 42 provides for the service of a notice by the
arbitrator on a party before he proceeds to hear the case.
On the other hand in paragraph 11, the court held that
Section 43 is confined to cases where a person, whether a
party or a third person, is required to appear as a witness
before the arbitrator. Such witnesses whom the arbitrator or
umpire desires to examine may be summoned
through court.
17. We, therefore, fail to see as to how this judgment
can advance the submission of the appellant, though it was
contended that Section 27 of the Act of 1996 is similar to
Section 43 of the Act of 1940. On the other hand, as stated
above, the Division Bench judgment of Delhi High Court
clearly lays down that Section 43 of the pre-cursor Act
permitted the arbitrator to call a third person as well as a
party as a witness, and the section was not confined only to
calling third persons as witnesses.
18. It was contended on behalf of the appellant that
whereas Section 43 used the phrase “parties and witnesses”,
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Section 27 did not contain such a phrase, and it speaks of
calling ‘any person’ as a witness. Section 27(2) (c) does
provide that an application under this section seeking
assistance of the court shall specify the name and address of
any person to be heard as a witness or as an expert witness.
As far as the appearance of a party in pursuance to a notice
of the arbitrator is concerned, there is a specific provision for
proceeding in the event of default of a party under Section
25. We may refer to Sections 25 and 27 in this behalf which
read as follows:-
“25. Default of a party.- Unless
otherwise agreed by the parties, where,
without showing sufficient cause,—-
(a) the claimant fails to communicate
his statement of claim in accordance with
sub-section (1) of section 23, the arbitral
tribunal shall terminate the proceedings;
(b) the respondent fails to communicate
his statement of defence in accordance with
sub-section (1) of section 23, the arbitral
tribunal shall continue the proceedings
without treating that failure in itself as an
admission of the allegations by the claimant.
(c) a party fails to appear at an oral
hearing or to produce documentary evidence,
the arbitral tribunal may continue the
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proceedings and make the arbitral award on
the evidence before it.”
“27.Court assistance in taking
evidence.- (1) The arbitral tribunal, or a
party with the approval of the arbitral
tribunal, may apply to the Court for
assistance in taking evidence.
(2) The application shall specify—-
(a) the names and addresses of the
parties and the arbitrators.
(b) the general nature of the claim and
the relief sought;
(c) the evidence to the obtained, in
particular,—-
(i) the name and address of any person
to be heard as witness or expert witness
and a statement of the subject-matter
of the testimony required;
(ii) the description of any document to
be produced or property to be
inspected.
(3) The Court may, within its
competence and according to its rules on
taking evidence, execute the request or
ordering that the evidence be provided
directly to the arbitral tribunal.
(4) The Court may, while making or
order under sub-section (3), issue the same
processes to witnesses as it may issue in
suits tried before it.
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(5) Persons failing to attend in
accordance with such process, or making any
other default, or refusing to give their
evidence, or guilty of any contempt to the
arbitral tribunal during the conduct of arbitral
proceedings, shall be subject to the like
disadvantages, penalties and punishments by
order of the Court on the representation of
the arbitral tribunal as they would incur for
the like offences is suits tried before the
Court.
(6) In this section the expression
“Processes” includes summonses and
commissions for the examination of
witnesses and summonses to produce
documents.”
19. As seen from these two sections, Section 25 (c)
provides that in the event a party fails to appear at an oral
hearing or to produce documentary evidence, the arbitral
tribunal may continue the proceedings, and make the
arbitral award on the evidence before it. This evidence can
be sought either from any third person or from a party to
the proceeding itself. The substitution of the phrase
“parties and witnesses” under Section 43 of the earlier act
by the phrase ‘any person’ cannot make any difference, or
cannot be read to whittle down the powers of the Arbitral
Tribunal to seek assistance from the court where any person
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who is not cooperating with the Arbitral Tribunal or where
any evidence is required from any person, be it a party to
the proceedings or others. It is an enabling provision, and it
has to be read as such. The term ‘any person’ appearing
under Section 27 (2) (c) is wide enough to cover not merely
the witnesses, but also the parties to the proceeding. It is
undoubtedly clear that if a party fails to appear before the
Arbitral Tribunal, the Tribunal can proceed ex-parte, as
provided under Section 25 (c). At the same time, it cannot
be ignored that the Tribunal is required to make an award
on the merits of the claim placed before it. For that
purpose, if any evidence becomes necessary, the Tribunal
ought to have the power to get the evidence, and it is for
this purpose only that this enabling section has been
provided.
20. The counsel for the appellant tried to take
advantage of the first sentence of paragraph 12 of the Delhi
High Court judgment, which reads as follows:-
“(12) Section 43 has no application
where the party to an arbitration agreement
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has to be summoned for appearance before
the arbitrator so that he may participate in
the proceedings and state his defense.”
We must however note, what the Division Bench has stated
thereafter, in the very paragraph which is to the following
effect.
“The learned judge seems to have been
misled by the expression ‘parties’ appearing
in section 43. The word ‘parties’ is used in
the sense where the party itself is desired to
be examined as a witness by the arbitrator or
umpire. The expression ‘witnesses’ used
along with the word ‘parties’ makes the
meaning of the legislature abundantly clear.
The principle of construction is that words of
the same feather flock together.”
As can be seen from the paragraph, the paragraph itself
says that Section 43 has no application for summoning a
party to appear to participate in the proceeding. It is meant
for securing the presence of third persons as well as parties
as witnesses. This position cannot be said to be altered due
to the absence of these words and use of the words ‘any
person’ in Section 27 of the Act of 1996.
21. It was contended that if the necessary documents
are not produced, at the highest an adverse inference may
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be drawn against the appellant. That is a power, of course
available with the Arbitral Tribunal, and if necessary the
same can be used. However, as observed by the learned
Arbitrator in her order dated 27.3.2007, the documents
sought in the present matter were required to arrive at the
decision on the claim of the respondent no. 1, since, the
quantification in support of the claim had been done by the
respondent no. 1 on a theoretical basis. A hypothetical
calculation should not be resorted to when actual Sales Tax
Assessments are available, which would show as to whether
the quantum of set-off allowed and claimed was in fact
justified.
22. In the circumstances, there is no substance in the
first objection viz. an order passed by the earlier Arbitrator
dated 27.3.2007, and the subsequent enabling order passed
by the Arbitral Tribunal dated 16.9.2011 permitting the
respondent to apply under Section 27 could not have been
passed.
23. The second objection was that the assessment
orders were confidential documents, and Section 71 of the
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Maharashtra Value Added Tax, 2002 and its pre-cursor
Section 64 of the Bombay Sales Tax Act, did not permit
production of these documents, and a direction as sought
could not have been granted. Since, these two sections are
invoked, the relevant part of both the sections are quoted
below.
“Section 71 (1) – All particulars
contained in any statement made, return
furnished or accounts or documents
produced in accordance with this Act, or in
any record of evidence given in the course of
any proceedings under this Act (other than
proceeding before a Criminal Court) or in any
record of any assessment proceeding, or any
proceeding relating to the recovery of a
demand, prepared for the purposes of this
Act shall, save as provided in sub-section (3),
be treated as confidential; and
notwithstanding anything contained in the
Indian Evidence Act, 1872 (1 of 1872), no
court shall save as aforesaid, be entitled to
require any servant of the Government to
produce before it any such statement, return,
account, document or record or any part
thereof, or to given evidence before it in
respect thereof.”
“Section 64 (1) – All particulars
contained in any statement made, return
furnished or accounts or documents
produced in accordance with this Act, or in
any record of evidence given in the course of
any proceedings under this Act (other than
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proceeding before a Criminal Court) or in any
record of any assessment proceeding, or any
proceeding relating to the recovery of a
demand, prepared for the purposes of this
Act shall, save as provided in sub-section (3),
be treated as confidential; and
notwithstanding anything contained in the
Indian Evidence Act, 1872 (1 of 1872), no
court shall save as aforesaid, be entitled to
require any servant of the Government to
produce before it any such statement, return,
account, document or record or any part
thereof, or to given evidence before it in
respect thereof.”
24. If we look at the words used in these two sections,
they very clearly state that particulars contained in any
return or statement made by a party, or document
produced along therewith are confidential, and no court
shall pass any order requiring the Government or a
Government servant to produce any such statement,
document or return. It is a settled principle of law that the
words used in a statute are to be read as they are used, to
the extent possible, to ascertain the meaning thereof. Both
these provisions contained a bar only against the
Government officers from producing the documents
mentioned therein. There is no bar therein against a party
to produce any such document. In Tulsiram Sanganaria
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and Another v. Srimati Anni Rai and Ors. reported in
1971 (1) SCC 284, a bench of three Judges of this Court
interpreted an identical provision in Section 54(1) of the
Income Tax Act, 1922, and held that the said provision
created a bar on the production of the documents
mentioned therein by the officials and other servants of the
Income Tax Department, and made it obligatory on them to
treat as confidential the records and documents mentioned
therein, but the assessee or his representative-in-interest
could produce assessment orders as evidence, and such
evidence was admissible. Thus, if a claim is to be decided
on the basis of an order of assessment, the claimant as well
cannot be denied the right to seek a direction to the party
concerned to produce the assessment order. It is this very
prayer which has been allowed by the earlier order dated
27.3.2007 passed by the then Arbitrator, and also by the
subsequent order dated 16.9.2011 passed by the Arbitral
Tribunal, and in our view rightly so. There is no substance
in the second objection as well.
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25. There is one more aspect which we must note,
i.e., when the first respondent made an application for
production of the assessment orders, the defence taken by
the appellant in their affidavit dated 16.9.2011 was that
those documents were confidential documents, and could
not be directed to be produced. It was not stated at that
time that the said documents were not available. It is ten
months thereafter, that when the second affidavit was filed
in the High Court, that the respondent for the first time
contended that the said documents were not available. This
was clearly an after thought, and this attitude of the
Respondent in a way justified the earlier order permitting an
application under Section 27 passed by the Arbitral Tribunal.
The Assistant Commissioner of Sales Tax of the concerned
area was also joined as respondent so that he could be
directed to produce the required documents. However, he
reported that those documents were old records, and were
destroyed. The learned Single Judge did not pass any order
against the respondent No.2 to produce the documents, as
sought. However, the learned Single Judge rightly allowed
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the petition as against the appellant in terms of prayer
clause ‘A’, directing the appellant to produce the documents
which were sought by the respondent no. 1.
26. In the circumstances, there is no merit in the
appeal. The appeal is, therefore, dismissed.
…………..……………………..J.
[ A.K. Patnaik]
……………………………..J.
[ H.L. Gokhale ]
New Delhi
Dated : September 23, 2013
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