- (1.) THE Court's arbitrary refusal to grant permission for remittance of the petitioner's retiral benefits is the substance of the writ application under consideration whereas the petitioner contended that whim and caprice are the two dominant features in refusing remittance of the retiral benefits so far as the petitioner is concerned, the respondents being the governmental agencies contended that by reason of outstanding dues against the petitioner, no permission for remittance of the retiral benefits can be granted to a foreigner.
(2.) ON the factual score it appears that the petitioner joined Indian Steamship Company as a probationer in November 1947. In May 1948, however, the petitioner was confirmed and there was a contract for three years renewable upon expiry. From 1948 to 1973 the petitioner was working with Indian Steamship Company in terms of the contract services. In May 1973 the petitioner was asked to go to Spain to attend I.P.D.C. Conference on behalf of the Indian Steamship Company. After attending the same, the petitioner, however, proceeded to the United Kingdom on home leave and in August, 1973, the petitioner tendered resignation from the service of the Indian Steamship Company. On 21st Sept., 1973 the petitioner's resignation was accepted by the Board of the Indian Steamship Company effective from 1st Oct., 1973. Certain correspondence thereafter were exchanged between the petitioner and his banker in regard to the remittance of the retiral benefits. 27th Dec., 1974 the company sought the income-tax clearance for the petitioner from the CIT. On 26th March, 1975 Indian Steamship Company made a written request to the RBI for permission to remit the petitioner's provident fund, gratuity and leave salary totalling Rs. ,19,564.71 in full and final settlement of his dues from the company. All necessary forms were sent along with the letter was required under the law. But by reason of a prior intimation by the Enforcement Directorate in regard to a pending proceeding under the Foreign Exchange Regulation Act, the RBI on 11th April, 1975 wrote to the company or certain information and documents including the up-to-date tax clearance certificate irrespect of the petitioner. The company in its turn duly forwarded all the informations required by the RBI. In the meantime, however, on 9th May, 1975 the ITO certified that the petitioner has been assessed up to the asst. yr. 1975-76 and all dues being fully paid. On 11th May the petitioner replied to the company's letter and on 26th May the company also furnished all the required information the RBI. Subsequently on 13th June, 1975 further particulars were sought for from the company in regard to the petitioner and the company duly furnished all necessary informations required to be furnished. 3. At this juncture, it would be convenient to note two letter dt. 9th July, 1975 and 18th July, 1975. By the first letter, the RBI informed the Enforcement Directorate that the application of the petitioner has been examined and the remittance applied for may be allowed on receipt of the clearance from the Enforcement Directorate and necessary advice was sought for at an early date. On 18th July, 1975, the Enforcement Directorate wrote to the RBI in reply to its letter dt. 9th July, 1975 that a show-cause notice has already been issued on 26th March, 1975 to Indian Steamship Company, its Directorate and its executive including the petitioner who was the Operation Manager, for violation of the Foreign Exchange Regulation Act involving an amount of ï¿ 1/2 4,89,742 and final reply to the show-cause notice from Mr. Smart, the petitioner herein, has not been received and the departmental proceeding can only be completed on receipt of respective replies including the petitioner. The RBI was, however, informed that as soon as the departmental proceeding would conclude, necessary intimations would be sent to the bank for further action in the matter. In that view of the matter on 31st July, 1975 the RBI intimated the company that no permission can be granted for remittance to the petitioner unit certain enquiries regarding the affairs of the company being conducted by the Enforcement Directorate are complete. The Enforcement Directorate's proceedings, however, were completed by about April 1977 in favour of the Indian Steamship Company and its executive officers including the petitioner, by reason wherefor, on 23rd April, 1977 the petitioner sought the information as to the remittance of his dues from the Enforcement Directorate and the RBI. The Indian Steamship Company also on 3rd May, 1977 asked for permission to remit the retiral dues to the petitioner.
(3.) ON 16th May, 1977 the RBI by reason of the letter from the Indian Steamship Company wrote to the Enforcement Directorate as to whether application for transfer of retiral benefits can be granted in favour of the petitioner. Subsequently, however, by a letter dt. 15th July, 1977, the Enforcement Directorate recorded the 'no objection' as regards transfer of retiral benefits to the petitioner, if the petitioner was otherwise eligible. However, on 1st Sept., 1977 Enforcement Directorate further informed the RBI to the effect that since certain other enquires are still pending, clearance to transmit the retiral benefits to the petitioner ought not be allowed and on 20th Sept., 1977, the RBI informed the company, about its inability consider the matter for the present, as further information was yet to be received from the Enforcement Directorate, reminder from the petitioner as well as the company has led to a letter dt. 1st Feb., 1978 from Enforcement Directorate to the RBI, wherein it has been stated the matter is receiving attention, correspondence proceeded thereafter from the petitioner to the Ministry of Finance, Government of India as also to the Central Office of the RBI, Bombay. Eventually on 25th Oct., 1978 Enforcement Directorate informed the RBI, Calcutta, that the former has no objection to the release of a total sum of Rs. 3,19,564.71P. to the petitioner in the usual manner. In the meantime, however, Enforcement Directorate on 25th Sept., 1978 informed the CIT that the petitioner had received payments abroad. Upon the clearance from the Enforcement Directorate on 25th Oct., 1978, the petitioner again pursued the matter, but as appears with no effect on 3rd Nov., 1978, however, the ITO informed the RBI that since a number of proceedings under the IT Act, 1961 ('the Act'), are pending against the petitioner and the different amounts payable were yet tot be ascertained; all payments to the petitioners should be held up pending further intimation from the IT Department. By that letter, it was informed that a formal attachment order under S. 201B of the Act was being sent separately. On 12th Dec., 1978 by reason of the persistent communication from the petitioner, the RBI wrote to the ITO as to the present position regarding the income-tax assessment proceedings against the petitioner on 23rd Feb., 1979, however, the ITO recorded the reasons for issued notice under s. 148 of the Act and on 3rd March, 1979 notice under S. 148 was issued to the petitioner. Incidentally it is to be noted that for the asst. yrs. 1970-71 to 1974-75 a notice was sent to the petitioner's former employer, viz., the Indian Steamship Company and the original notice was sent to the petitioner by registered post at London, though, however, the same was returned from London Postal Department as ''unserved'' On 17th April, 1979 the Indian Steamship Company forwarded a copy notice under S. 148 to the petitioner. On the same date, the company, however, informed the concerned ITO that it had no authority to accept the notice on behalf of the petitioner. Correspondence thereafter followed and on 25th April 1979 the petitioner sent a letter to the ITO admitting the receipt of the notice under S. 148 on 24th April, 1979 and on 7th June, 1979, as a matter of fact, authorised representative of the petitioner attended the office of the ITO with the written authority dt. 4th May, 1979. On 19th Sept., 1980 the Tribunal passed its order on the Indian Steamship Company's appeal before the Tribunal in regard to the undisclosed income. The Tribunal categorically held that it was not possible to conclude on the basis of the unsigned certificate that payments had been made to the petitioner. As a matter of fact, Indian Steamship Company has been completely exonerated. The Directorate of Enforcement, however, filed a petition on 29th Sept., 1980 for review of the order dt. 22nd April 1977. The petition for review, however, was subsequently dismissed on 30th Sept., 1982. On 8th Jan., 1981 the CBDT informed that the CIT, West Bengal, has no objection for release of the petitioner's dues against a guarantee. Subsequently, however, the entire money was transmitted to the petitioner upon a bank guarantee being furnished by the petitioner for the entire sum and thereafter the writ petition was moved before this Court.;