M. P. MITTAL v. STATE OF HARYANA AND ORS.

The Judgment of the Court was delivered by PATHAK, J This appeal by special leave is directed against E the judgment and order of the High Court of Punjab and Haryana dismissing a writ petition in limine. Messrs. Depro Foods Limited entered into a contract with the Haryana State Industrial Development Corporation Limited, where- by the said Corporation underwrote preference shares of Messrs. F Depro Foods Limited of Rs. JOO each for a total value of Rs. 3.6 ·lacs on which a dividend of 9.5% per annum was payable. The appellant who was apparently, at the relevant time, the Managing Director of Messrs. Depro Foods Limited, executed an agreement under which he guaranteed in his personal capacity the payment of the dividend income due in respect of the aforesaid shares to the U said Corporation. It .is not disputed that Messrs. Depro Foods Limited did not pay Rs. l ,96,961 representing the dividend payable to the said Corporation, and therefore the appellant became personally liable as Guarantor to pay that amount. It seems that on the failure of the appellant to make payment, the said Corporation invoked a provision in the Guarantee agreement which declares : H

942 sin>REMB COURT REPORTS [1985) 1 s.c.k.

A "5. That the dues on account of this guarantee will be recoverable in the manner in which land revenue is collected by the Government".

Consequently it applied to the Assistant Collector, Sonepat for instituting recovery proceedings. The Assistant Collector com~en­ B ced coercive measures, which included the issue of a warrant for the arrest of the appellant. The appellant filed a writ petition in the High Court but a Division Bench of the High Court passed an order on August 2, 1978 summarily dismissing the writ petition.

At one stage during the hearing of this appeal it appeared c poss;ble that the dispute could be resolved if even now after a lapse of six years the appellant was prepared to discharge his liability as Guarantor by making payment to the Corporation of the amount sought to be recovered, if necessary in accordance with a convenient time schedule of instalments, but Shri K.K. Jain, learned couusel for the appellant, stated frankly that in spite of repeated communica- D tions to bis client he had not received any reply from him.

The questions have been raised by learned counsel for the appellant. Both questions arise on the assumption that the appel- lant is liable to pay the amount due from him. The first question is : Whether the amount can be recovered as an arrear of land E revenue, including the mode by detention, where such right is foun- ded in private agreement "/ The other questios is : If the recovery is made by reference to clause (bb) of s. 98 of the Punjab Land Revenue Act, 1887 which speaks of :- "(bb) Dividend payable to the Government on Cumulative Redeemable Preference Shares subscribed by or on behalf of the Government". Can that clause be employed for recovering dividend payable to Haryana State Industrial Development Corporation Limited ?

G Now there is no dispute that the appellant knowingly and ·~

deliberately entered into the Guarantee agreement, and is liable as \ Guarantor to make payment of the dividend due from Messrs Depro Foods Limited. Nor is it disputed that the amount due, with interest, stands at 2,02,166 in respect of the period ending with the year 1977. It was not contended that the appellant in fact H does not possess sufficient funds or cannot avail of sufficient per-

M.P. MiTTAL v. ilARYANA (Pathak, J.) 943

sonal property for the purpose of discharging the liability. The A record also shows that before instituting coercive proceedings, the Assistant Collector provided the appellant an opportunity to pay up the amount due from him, and that the appellant made no attempt to discharge the liability. When that is so, we are of opinion that he is not entitled to relief in these proceedings. The appeal arises out of a writ petition, and it is well settled that when a petitioner B invokes the jurisdiction of the High Court under Article 226 of the Constitution, it is open to the High Court to consider whether, in the exercise of its undoubted discretionary jurisdiction, it should de- cline relief to such petitioner if the grant of relief would defeat the interests of justice. The Court always has power to refuse relief where the petitioner seeks to invoke its writ jurisdiction in order to c secure a dishonest advantage or perpetuate an unjust gain. This is a case where the High Court was fully justified in refusing relief. On that ground alone, the appeal must fail.

Before parting with this case, we think it appropriate to point D out that it would be beneficial to the general administration of justice if in certain cases where the High Court disposes of a writ petition in limine it does so by an order incorporating the reasons for such order. Where a case is admitted to final hearing, the judgment of the High Court disposing of the appeal almost invariably sets forth the reasons for its decision. We think it desirable that even when a E writ petition is dismissed in /imine the High Conrt should set out its reasons, however briefly, for doing so, especially in those cases where the matter in controversy is the subject of judicial examina- tion for the first time and has not been processed earlier by an in- ferior judicial or quasi-judicial authortty. It is of some importance fl that party should know from the court of first instance the reasons for an adverse decision received by it, for that promotes acceptance of the judgment and thereby ensures credibility and public confi- dence in the judicial institution. It must be remembered that the High Court exercises original jurisdiction under Article 226 of the Constitution, and it is only appropriate that a petitioner whose G writ petition is dismissed in limine should know what are the precise reasons for the adverse order, whether the writ petition has been rejected on the ground of !aches or other preliminary ground or on the merits of the controversy, and what are the reasons of the High Conrt therefor. We may add that a brief. statement of reasons rendered by the High Court, when dismissing the writ H

944 stlPllllMil COURT REPORTS t1985i I S.C.ii.·

A petition in limlne, is of great assistance also to this Court when the judgment a,nd order of the High Court are sought to be brought here by a petition for special leave to appeal. To sum up, we think it desirable that the High Court, when dismissing in limine, should B set forth a brief statement of the reasons for its order instead of dis- posing of the proceeding by the single word "dismissed",

Upon the considerations set forth earlier, we dismiss the appeal but without any order a,s to costs. c

M.L.A. Appeal dismissed.