Facts of the Case

The petitioner, National Council for Cement & Building Material through its Director General, filed a writ petition before the Delhi High Court against the Director of Income Tax.

During the hearing, the Court observed that the petitioner ought to have obtained approval from the High Powered Committee on Disputes (Committee on Disputes/COD) before pursuing the litigation.

Counsel appearing for the petitioner informed the Court that an application seeking such approval had already been submitted. However, the approval had not been granted at the time of hearing.

Since the requisite approval had not yet been obtained, the Court considered whether the writ petition could be entertained.

Issues Involved

  1. Whether the writ petition could be entertained in the absence of approval from the High Powered Committee on Disputes (COD).
  2. Whether liberty should be granted to the petitioner to institute fresh proceedings after obtaining the requisite approval.

Petitioner’s Arguments

  • The petitioner submitted that approval from the High Powered Committee on Disputes had already been applied for.
  • It was represented before the Court that the approval process was pending and had not yet been completed.

Respondent’s Arguments

  • The order does not record any detailed submissions on behalf of the respondent.
  • The matter was disposed of primarily on the procedural requirement relating to approval from the Committee on Disputes.

Court Findings / Observations

The Delhi High Court held that the petitioner ought to have obtained approval from the High Powered Committee on Disputes before pursuing the writ proceedings.

The Court noted that although an application seeking approval had been made, the approval had not yet been granted. In these circumstances, the Court declined to entertain the writ petition any further.

The Bench emphasized compliance with the requirement of obtaining prior approval from the competent committee before litigation between government-related entities could proceed.

Court Order

  • The Court declined to entertain the writ petition because approval from the High Powered Committee on Disputes had not been obtained.
  • The writ petition was disposed of.
  • Liberty was granted to the petitioner to file a fresh writ petition within 15 days from the receipt of the order granting such approval, if approval was subsequently granted by the Committee on Disputes. 

Important Clarification

The Court did not adjudicate upon the merits of the dispute between the parties.

The writ petition was disposed of solely on the ground that the petitioner had not obtained the necessary approval from the High Powered Committee on Disputes. The Court expressly preserved the petitioner’s right to institute fresh proceedings upon obtaining the requisite approval.

Relevant Sections / Legal Provisions Involved

  • Directions relating to obtaining approval from the High Powered Committee / Committee on Disputes (COD) for litigation involving Government Departments, Public Sector Undertakings, and Government-controlled entities.
  • Principles governing maintainability of inter-governmental disputes before courts without prior approval of the competent committee.

Link to download the order -

https://delhihighcourt.nic.in/app/case_number_pdf/2010:DHC:10488-DB/BDA26052010CW119212009_160317.pdf

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