UNIQUE ORGANICS LIMITED V. UNION OF INDIA

CW/14226/2023

AI Insights

The case involves Unique Organics Limited, which challenged the validity of two customs notifications (no. 49/2023-Customs and 50/2023-Customs) that imposed export duties and set conditions for exemption based on the mode of payment. The petitioner argued that the notifications were discriminatory as they favored exports backed by irrevocable letters of credit over those with other payment methods, including advance payments. The respondents contested the jurisdiction of the Rajasthan High Court, arguing that the cause of action arose outside its territorial limits, specifically where the customs station is located. The court focused on whether any part of the cause of action occurred within its jurisdiction, ultimately concluding that it did not, leading to the dismissal of the petition.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 686258 (HC-RAJASTHAN)
• Appeal Type: Others
• Pronouncement Date: 13-09-2023
• Assessment Year: misc
• Other Referred Cases: Union of India & Others Vs. Adani Exports Ltd. & Another, State of Goa Vs. Summit Online Trade Solutions Private Limited & Others, Nawal Kishore Sharma Vs. Union of India & Others
• Laws Referred To: Companies Act, 1956, Constitution of India
• Result in Favour of: Revenue
• Court: HIGH COURT
• Department Lawyers: SANDEEP PATHAK; JAYA PATHAK; VARTIKA MEHRA
• Assessee Lawyers: PRATEEK KASLIWAL; GAURI JASANA; VARNALI PUROHIT
• Keywords: Arbitrary; Customs Duty; Discriminatory; Exemption; Territorial jurisdiction; Writ petition
• Section: 14

Judgement Text

"[2023:RJ-JP:23491-DB] HIGH COURT OF JUDICATURE FOR RAJASTHAN BENCH AT JAIPUR D. B. Civil Writ Petition No. 14226/2023 IN THE MATTER OF: Unique Organics Limited, a Company registered under the Companies Act, 1956, having its registered office at E-521, Sitapura Industrial Area, Jaipur-302022 through its authorized signatory Mr. Ramavtar Jangid S/o Sh. Lallu Ram Jangid ----Petitioner Versus 1. Union of India, Ministry of Finance, 10, Sansad Marg, Janpath Connaught Place, New Delhi-110001 through its Secretary. 2. Union of India, Department of Revenue, Room No. 48C, North Block, New Delhi-110001 through its Director. 3. Commissioner of Customs, 3Rd Floor, Customs House, 15/1, Strand Road, Kolkata-700001. ----Respondents For Petitioner : Mr. Prateek Kasliwal Advocate with Ms. Gauri Jasana Advocate and Ms. Varnali Purohit Advocate. For Respondents : Mr. Sandeep Pathak Advocate with Ms. Jaya P. Pathak Advocate and Ms. Vartika Mehra Advocate. HON'BLE MR. JUSTICE MANINDRA MOHAN SHRIVASTAVA HON'BLE MR. JUSTICE PRAVEER BHATNAGAR Order REPORTABLE 13/09/2023 1. On the first date of hearing, Mr. Sandeep Pathak, learned counsel, on advance copy, entered appearance and took notice on behalf of Respondents No. 1 and 2. While on behalf of the petitioner, it was contended that the impugned notification no. 50/2023-Customs dated 25.08.2023, which denies benefit of exemption to those who have already made payment in cash and allows benefit of exemption even to [2023:RJ-JP:23491-DB] (2 of 18) [CW-14226/2023] those who have opened letters of credit before 25th day of August, 2023, is discriminatory and arbitrary coupled with prayer to protect the petitioner by interim order allowing export of goods as interim measure with appropriate conditions, a serious objection with regard to territorial jurisdiction of this High Court to entertain the writ petition was taken by learned counsel for Respondents No. 1 and 2. The case was, therefore, directed to be listed for consideration on objection to maintainability of the writ petition, keeping in view the settled principle that where an objection to maintainability of a petition is raised, that has to be decided first before entering into the merits of the case. Though no reply has been filed, learned counsel for Respondents No. 1 and 2 argued on the issue of territorial jurisdiction of this Court in entertaining the writ petition stating that to decide the aforesaid issue of territorial jurisdiction, reply is not necessary. 2. We have heard learned counsel for the parties on the objection to the territorial jurisdiction of this Court to entertain this writ petition. 3. Learned counsel for Respondents No. 1 and 2 contended that as no part of cause of action has arisen within the territorial jurisdiction of this Court, this Court would not have jurisdiction and the objection to maintainability of the writ petition is liable to be sustained. Learned counsel further argued that the facts as pleaded in the writ petition essentially seek to challenge the validity of notification no. 49/2023-Customs and 50/2023- Customs, dated 25.08.2023 issued by the Ministry of Finance, Department of Revenue, Government of India mainly on the [2023:RJ-JP:23491-DB] (3 of 18) [CW-14226/2023] ground that they allow export of goods where payment has been done by only one mode, i.e., irrevocable letters of credit and seek to exclude the export of goods where payment has been made by other modes including by advance payment, with statement of facts that the petitioner otherwise complies with other conditions for grant of exemption as specified in the impugned notifications insofar as goods meant for export have entered the customs station for the purpose of exportation before 25th day of August, 2023 and an order permitting clearance has not been issued by the proper officer. Learned counsel would submit that the bundle of facts, which are integral to cause of action, have all arisen within the territorial jurisdiction of the High Court where the port is actually situated and where the petitioner claims to have entered the goods in the customs station. Learned counsel would submit that the petitioner has filed this writ petition on the assumption that on account of payment through cash mode only, the benefit of exemption is not being granted and clearance is not being issued whereas there is nothing on record to show that clearance has been denied on that ground only, holding the petitioner liable for payment of export duty. Therefore, it is contended that the fact that the petitioner carries on its business and having registered office at Jaipur and payments having been received at Jaipur are not integral part of the cause of action, but what is integral to the cause of action is that the goods have entered in the customs station for the purpose of exportation before 25th day of August, 2023 and no order permitting clearance has been issued by the proper officer. The incidence of tax is export of goods which is to take place at the port situated outside [2023:RJ-JP:23491-DB] (4 of 18) [CW-14226/2023] the territorial jurisdiction of this Court. Whether or not the goods have entered the customs station and all other aspects which are necessary for determination as fact before the petitioner could claim exemption, have arisen outside the territorial jurisdiction of this Court. Accordingly, it is argued, payment received at Jaipur is not an integral part of cause of action to get the relief of either seeking quashment of impugned notifications as arbitrary and discriminatory or alternative relief for modifying notification no. 50/2023-Customs dated 25.08.2023. In support of his submissions, learned counsel for Respondents No. 1 and 2 has placed reliance upon the decisions of the Hon’ble Supreme Court in the cases of Union of India & Others Vs. Adani Exports Ltd. & Another (2002) 1 SCC 567 and State of Goa Vs. Summit Online Trade Solutions Private Limited & Others (2023) 7 SCC 791. 4. Per contra, learned counsel for the petitioner contended that the petitioner seeks to challenge the validity of the notification on the proposed ground that it is discriminatory and violative of Article 14 of the Constitution of India as it seeks to extend the benefit on the basis of payment only through one mode, i.e., letters of credit and excluding all other modes. The factum of payment having been received at Jaipur through the mode of Foreign Inward Remittance is not only relevant but integral to the cause of action and, therefore, a part of cause of action has arisen within the territorial jurisdiction of this Court. Learned counsel for the petitioner further contended that the petitioner is not only carrying its business and having registered office at Jaipur, the contracts were also entered into between the petitioner and the [2023:RJ-JP:23491-DB] (5 of 18) [CW-14226/2023] purchasers situated in different countries, at Jaipur. According to him, receipt of payment through the mode of Foreign Inward Remittance is the basis to challenge notification no. 50/2023- Customs dated 25.08.2023, which on its literal reading, denies the benefit. In support of his submissions, learned counsel for the petitioner has placed reliance on the decision of the Hon’ble Supreme Court in the case of Nawal Kishore Sharma Vs. Union of India & Others (2014) 9 SCC 329. 5. It is well settled that while dealing with an objection as to lack of territorial jurisdiction of a Court to entertain a writ petition on the ground that the cause of action has not arisen within its jurisdiction, this Court essentially has to arrive at a conclusion on the basis of the averments made in the writ petition treating the same as true and correct. This has been observed as the fundamental principle in plethora of decisions by the Hon’ble Supreme Court, including a recent pronouncement in the case of State of Goa Vs. Summit Online Trade Solutions Private Limited & Others (supra). Therefore, in order to appreciate the submissions and decide the issue of territorial jurisdiction, we shall first look into the averments made in the writ petition as they stand, without going into the correctness or otherwise of those factual statements. 6. It is pleaded in the writ petition, inter alia, that the petitioner is a company registered under the Companies Act, 1956 since 1993 and claims to be a leading star export house. The title of the case shows that it has its registered office at Jaipur. As pleaded, the petitioner is engaged in manufacturing and trading in various Non-GMO, products and Certified Organic products in the markets [2023:RJ-JP:23491-DB] (6 of 18) [CW-14226/2023] of Europe, USA, Canada, UK, Vietnam, Myanmar, Sri Lanka. Further pleadings are that the petitioner entered into three agreements for the export of Indian Swarna Parboiled Rice (25% Broken) with three different buyers based in Vietnam. It is also pleaded that the contracts were also executed between the petitioner being the seller and the three buyers on 09.08.2023, 18.08.2023 and 18.08.2023 respectively. However, the places, where the contracts are alleged to have been executed, have not been stated in the writ petition. Copies of agreements have also been placed on record which also do not show the places where the contracts were executed. According to the petitioner, it received advance amount from all the three buyers in the form of Foreign Inward Remittance. Copies of advance so received have also been annexed which show that those payments were received at Jaipur. 7. As pleaded, a notification bearing no. 49/2023-Customs dated 25.08.2023 was issued by the respondents levying 20% duty (on value) on the export of Parboiled Rice effective immediately/from the date of coming into force of the said notification. Another notification bearing no. 50/2023-Customs dated 25.08.2023 was also issued by the respondents wherein it was notified that the export duty, imposed vide notification no. 49/2023-Customs shall remain effective till 15.10.2023. It was also notified that the quantity of Parboiled Rice that has entered the customs stations for the purpose of exportation before 25th day of August, 2023 and for which the proper officer has not issued an order permitting clearance and which is backed by irrevocable letters of credit would continue to be exempted/shall [2023:RJ-JP:23491-DB] (7 of 18) [CW-14226/2023] remain exempted from the duty so levied. Both the aforesaid notifications have also been placed on record. 8. The petitioner then pleaded that the petitioner’s cargo containing Parboiled Rice forming the subject matter of the aforementioned three contracts entered the customs entry gate for exportation on 25.08.2023 between 16:19 hours (4:19 PM) and 21:35 hours (9:25 PM), which, as pleaded, was well before the publication of two notifications, which according to the petitioner were issued at 10:49 PM. It is also pleaded that the said cargo went inside the port and the formalities pertaining to the same including the registration and the scanning were also completed before the impugned notifications were published. The petitioner has also pleaded that a requisite procedure is followed for goods which are meant to be exported requiring clearance at the Customs which starts with the e-sealing using an electronic seal and scanning of e-seal at the time of entry/gate-in. Thereafter, the container is allowed entry inside the port. Petitioner’s cargo containing the subject matter goods, as pleaded, were e-sealed on 24.08.2023, a day prior to the publication of the impugned notifications as would be evident from the details taken from the official portal of the Customs Department depicting the details of each e-sealing, i.e., e-seal number, the date and time of e-sealing and the shipping bills. The said documents have also been placed on record along with the petition. 9. It is then pleaded that before the subject matter goods could obtain orders permitting their clearance by the proper officer, impugned notifications were published on 25.08.2023 at 22:49 hours coming into effect immediately and rendering the subject [2023:RJ-JP:23491-DB] (8 of 18) [CW-14226/2023] matter goods dutiable. It is further pleaded that after issuance of notification, the subject matter goods were unable to obtain the requisite clearance of concerned officer and hence, could not be processed for exportation as a result of which it is still lying at the Customs Department. The petitioner mailed its request to Respondent No. 3 for allowing the shipment of the petitioner which was gated-in prior to the publication of the impugned notifications, but no steps have been taken in this regard. 10. On the aforesaid pleaded facts, the petitioner has challenged the validity of the notifications on the ground that two notifications are being operated in an arbitrary way and in such a manner, they operate retrospectively, which according to the petitioner, is impermissible in law. Further ground raised is that the petitioner, by virtue of those two notifications, is being punished/penalised by the law of which it had no knowledge at the time of executing the contracts or even at the time when goods were gated-in, the notifications seek to impose tax liability for a taxing event which took place prior to issuance of notifications. Further ground raised is that though notification no. 50/2023-Customs dated 25.08.2023 allows export of goods without payment of customs duty in those cases where export of goods are backed by irrevocable letters of credit, on literal reading, the same seeks to exclude, as a class, all those cases of export of goods where payments have been made by other modes including advance payment, as is the case of the petitioner. 11. If we look into the entire pleadings in the writ petition, there is nothing to show that the clearance has been withheld on the ground that payment is through the mode of cash and not through [2023:RJ-JP:23491-DB] (9 of 18) [CW-14226/2023] irrevocable letters of credit. In fact, there is no specific averment to that effect in the writ petition that only on that ground, clearance has been refused insisting on payment of customs duty. Rather, all other facts pleaded in the writ petition which relate to entering the goods in customs station for the purpose of exportation before 25th day of August, 2023, without there being any order permitting clearance issued by proper officer have been stated. The petitioner, without any basis, has assumed that clearance is not being provided and payment of customs duty is being insisted upon only on the ground of cash payment. 12. Therefore, the facts, as pleaded in the writ petition, do not make out a case of a grievance on the basis that despite goods having entered the customs station in the manner prescribed by the laid down procedure, prior to issuance of the impugned notifications only on the ground of different mode of payment than the one which has been stated in the notifications, the petitioner is being discriminated. Had it been a case that the respondents have refused to grant the benefit of exemption from payment of customs duty only on the ground of payment through cash mode, it would have been an integral part of cause of action as the petitioner was required to prove this fact, unless traversed, to succeed in getting the relief sought in the writ petition. All other facts stated in the petition, indisputably, which otherwise could be treated as integral part of cause of action, even according to the petitioner, have arisen outside the territorial jurisdiction of this Court. 13. The principles applicable to decide whether a cause of action, wholly or in part, has arisen for exercise of power conferred under [2023:RJ-JP:23491-DB] (10 of 18) [CW-14226/2023] Article 226(1) of the Constitution of India has been laid down, in various facts and circumstances, having universal application, in series of decision by the Hon’ble Supreme Court. 14. In the case of Union of India & Others Vs. Adani Exports Ltd. & Another (2002) 1 SCC 567 (supra), somewhat similar facts as in the present case, had arisen for consideration. On facts, that was a case where claim of the benefit of the Passbook Scheme contained in Import Export Policy in relation to certain credits to be given on export of shrimps was involved. The respondents therein claimed benefit on the basis of export of prawns and import of the inputs. It was an admitted fact that the benefits, which the respondents therein were seeking, were to be extended through the port situated at Chennai. As those benefits were not admitted for various reasons, the respondents therein filed special civil applications before the High Court at Ahmedabad. In support of the case that a part of cause of action had arisen within the territorial jurisdiction of the Court at Ahmedabad, the facts were noted by the Hon’ble Supreme Court as below: “13. In spite of the above admitted facts, the respondents herein plead that as per the plea raised by them in para 16 of the special civil application, the following facts give rise to the cause of action conferring territorial jurisdiction on the Court at Ahmedabad. They are: (i) the respondents carry on their business of export and import from Ahmedabad; (ii) their orders of export and import are placed from and are executed at Ahmedabad; (iii) documents and payments for export and import are sent/made at Ahmedabad; (iv) the credit of duty claimed in respect of exports were handled from Ahmedabad since export orders were received at Ahmedabad and payments also received at Ahmedabad; (v) non-granting and denial of utilisation of the credit in the passbook will affect the business of the respondents at Ahmedabad; [2023:RJ-JP:23491-DB] (11 of 18) [CW-14226/2023] (vi) the respondents have executed a bank guarantee through their bankers at Ahmedabad as well as a bond at Ahmedabad.” It is, thus, clear that grievance was with regard to non-grant and denial of utilisation of the credit in the pass book. In para 12 of the aforesaid decision, the admitted facts relevant for the purpose of conferring territorial jurisdiction in order to find out whether any part of cause of action had arisen at Ahmedabad, the Hon’ble Supreme Court observed as under: “12. We will now examine whether any of the facts mentioned in para 16 of the applications or for that matter in the entire special civil applications would give rise to any part of the cause of action at Ahmedabad, at least for the purpose of conferring territorial jurisdiction on the High Court at Ahmedabad. At this stage, it is relevant to mention that it is an admitted fact that none of the respondents in the civil applications (appellants herein) are stationed at Ahmedabad. It is also an admitted fact that the passbook in question, benefit of which the respondent is seeking in the civil applications, is issued by an authority who is stationed at Chennai. The designated authority who is the competent person in respect of the matters concerning the Passbook Scheme and who discharges various functions under the Scheme is also stationed at Chennai. The entries in the passbook under the Scheme concerned are to be made by the authorities at Chennai. The export of prawns made by the respondents and the import of the inputs, benefit of which the respondents are seeking in the applications, also will have to be made through the same port i.e. Chennai.” Having thus noted the factual premise and the facts as stated and the contentions in support of the argument that part of cause of action had arisen at Ahmedabad, it was held by the Hon’ble Supreme Court as below: “14. Though it is also contended in para 16 of the application that the appellants have their office at Ahmedabad, that contention has not been pressed since it is clear from the records that none of these appellants have their office at Ahmedabad. Dehors this fact, if we take into consideration the other facts enumerated hereinabove in support of the cause of action pleaded by the respondents, it is seen that none of these facts is in [2023:RJ-JP:23491-DB] (12 of 18) [CW-14226/2023] any way connected with the relief sought for by the respondents in their civil applications so as to constitute the cause of action at Ahmedabad. 15. Article 226(2) of the Constitution of India which speaks of the territorial jurisdiction of the High Court reads: “226. (2) The power conferred by clause (1) to issue directions, orders or writs to any Government, authority or person may also be exercised by any High Court exercising jurisdiction in relation to the territories within which the cause of action, wholly or in part, arises for the exercise of such power, notwithstanding that the seat of such Government or authority or the residence of such person is not within those territories.” 16. It is clear from the above constitutional provision that a High Court can exercise the jurisdiction in relation to the territories within which the cause of action, wholly or in part, arises. This provision in the Constitution has come up for consideration in a number of cases before this Court. In this regard, it would suffice for us to refer to the observations of this Court in the case of Oil and Natural Gas Commission v. Utpal Kumar Basu (1994) 4 SCC 711 (SCC at p. 713) wherein it was held: “Under Article 226 a High Court can exercise the power to issue directions, orders or writs for the enforcement of any of the fundamental rights conferred by Part III of the Constitution or for any other purpose if the cause of action, wholly or in part, had arisen within the territories in relation to which it exercises jurisdiction, notwithstanding that the seat of the Government or authority or the residence of the person against whom the direction, order or writ is issued is not within the said territories. The expression ‘cause of action’ means that bundle of facts which the petitioner must prove, if traversed, to entitle him to a judgment in his favour by the court. Therefore, in determining the objection of lack of territorial jurisdiction the court must take all the facts pleaded in support of the cause of action into consideration albeit without embarking upon an enquiry as to the correctness or otherwise of the said facts. Thus the question of territorial jurisdiction must be decided on the facts pleaded in the petition, the truth or otherwise of the averments made in the petition being immaterial.” 17. It is seen from the above that in order to confer jurisdiction on a High Court to entertain a writ petition or a special civil application as in this case, the High Court must be satisfied from the entire facts pleaded in [2023:RJ-JP:23491-DB] (13 of 18) [CW-14226/2023] support of the cause of action that those facts do constitute a cause so as to empower the court to decide a dispute which has, at least in part, arisen within its jurisdiction. It is clear from the above judgment that each and every fact pleaded by the respondents in their application does not ipso facto lead to the conclusion that those facts give rise to a cause of action within the court’s territorial jurisdiction unless those facts pleaded are such which have a nexus or relevance with the lis that is involved in the case. Facts which have no bearing with the lis or the dispute involved in the case, do not give rise to a cause of action so as to confer territorial jurisdiction on the court concerned. If we apply this principle then we see that none of the facts pleaded in para 16 of the petition, in our opinion, falls into the category of bundle of facts which would constitute a cause of action giving rise to a dispute which could confer territorial jurisdiction on the courts at Ahmedabad. 18. As we have noticed earlier, the fact that the respondents are carrying on the business of export and import or that they are receiving the export and import orders at Ahmedabad or that their documents and payments for exports and imports are sent/made at Ahmedabad, has no connection whatsoever with the dispute that is involved in the applications. Similarly, the fact that the credit of duty claimed in respect of exports that were made from Chennai were handled by the respondents from Ahmedabad have also no connection whatsoever with the actions of the appellants impugned in the application. The non-granting and denial of credit in the passbook having an ultimate effect, if any, on the business of the respondents at Ahmedabad would not also, in our opinion, give rise to any such cause of action to a court at Ahmedabad to adjudicate on the actions complained against the appellants.” The considerations as above were applied to the factual premise of that case and it was authoritatively held by the Hon’ble Supreme Court that all those facts stated in para 13 would not constitute even a part of cause of action so as to give territorial jurisdiction to the High Court at Ahmedabad. Crucial aspect taken into consideration was that unless the facts pleaded are such which have nexus and relevance with the lis involved in the case, the same would not constitute integral part of the cause of action [2023:RJ-JP:23491-DB] (14 of 18) [CW-14226/2023] so as to say that it arose within the territorial jurisdiction of the High Court at Ahmedabad. 15. The aforesaid principle was lucidly reiterated by the Hon’ble Supreme Court in recent judicial pronouncement in the case of State of Goa Vs. Summit Online Trade Solutions Private Limited & Others (supra). On facts, that was a case where notifications issued under the Central Goods and Services Tax Act, 2017 and the Integrated Goods and Services Tax Act, 2017 were under challenge. The Factual background of that case was noted by the Hon’ble Supreme as below: “11. The High Court, while delivering the impugned judgment and order, proceeded to hold that the writ petitioners were aggrieved not only by the impugned notification issued by the appellant under the GGST Act but also by the act of the Central Government in issuing the impugned notifications under the CGST Act as well as the IGST Act seeking to levy tax (GST) on lotteries organised, promoted and conducted by the State of Sikkim. The High Court further noted that it was not the actual incidence of GST under the GGST Act which is impugned in the writ petitions but the provisions of law made by the Parliament as well as the respective State Governments including the State of Goa by which they sought to levy GST on lotteries. Considering the prayers made in the writ petition, the High Court was further of the view that, at least, a part of the cause of action had arisen within its jurisdiction. The High Court was also of the view that since notice had been issued on WPs(C) Nos. 36 and 38 of 2017 on 17-7-2017, much before Rule was issued by the High Court of Bombay at Goa on 20- 9-2017 in Serenity Trades (P) Ltd. v. Union of India, 2017 SCC OnLine Bom 10242, no ground had been set up by the appellant for deletion; hence, the interim applications seeking deletion stood dismissed. 12. In support of territorial jurisdiction of the High Court to entertain and try the writ petition, this is what the petitioning company has stated: “29. That this Hon’ble Court has jurisdiction to entertain the said writ petition as the cause of action arises in Sikkim only. Both the petitioner and the respondents are located within the territorial jurisdiction of this Hon’ble High Court.” [2023:RJ-JP:23491-DB] (15 of 18) [CW-14226/2023] Apart from these two sentences, nothing more has been averred in support of territorial jurisdiction of the High Court. 13. From the above, it is clear that according to the petitioning company the cause of action has arisen in Sikkim only, meaning thereby the whole of the cause of action and not part of it; additionally, it is stated that all the respondents are located within the territorial jurisdiction of the High Court which is factually incorrect.” The cause of action in the aforesaid case was explained as below: “16. The expression “cause of action” has not been defined in the Constitution. However, the classic definition of “cause of action” given by Lord Brett in Cooke vs. Gill (1873) LR 8 CP 107 that “cause of action means every fact which it would be necessary for the plaintiff to prove, if traversed, in order to support his right to the judgment of the court”, has been accepted by this Court in a couple of decisions. It is axiomatic that without a cause, there cannot be any action. However, in the context of a writ petition, what would constitute such “cause of action” is the material facts which are imperative for the writ petitioner to plead and prove to obtain relief as claimed. 17. Determination of the question as to whether the facts pleaded constitute a part of the cause of action, sufficient to attract clause (2) of Article 226 of the Constitution, would necessarily involve an exercise by the High Court to ascertain that the facts, as pleaded, constitute a material, essential or integral part of the cause of action. In so determining, it is the substance of the matter that is relevant. It, therefore, follows that the party invoking the writ jurisdiction has to disclose that the integral facts pleaded in support of the cause of action do constitute a cause empowering the High Court to decide the dispute and that, at least, a part of the cause of action to move the High Court arose within its jurisdiction. Such pleaded facts must have a nexus with the subject-matter of challenge based on which the prayer can be granted. Those facts which are not relevant or germane for grant of the prayer would not give rise to a cause of action conferring jurisdiction on the court. These are the guiding tests.” Having thus explained the principle, the Hon’ble Supreme Court held that the Court at Sikkim had no territorial jurisdiction. [2023:RJ-JP:23491-DB] (16 of 18) [CW-14226/2023] 16. Heavy reliance has been placed by learned counsel for the petitioner on the decision of the Hon’ble Supreme Court in the case of Nawal Kishore Sharma Vs. Union of India & Others (supra). In the aforesaid decision also, the principles, which have been stated and restated time and again, were stated and referred to by the Hon’ble Supreme Court. It was explained in para 16 of the aforesaid judgment that there cannot be any doubt that the question whether or not cause of action wholly or in part for filing a writ petition has arisen within territorial limit of any High Court has to be decided in the light of the nature and character of the proceedings under Article 226 of the Constitution of India and in order to maintain a writ petition, the petitioner has to establish that a legal right claimed by him/her has been infringed by the respondents within the territorial limit of the Court’s jurisdiction. On that premise, the factual aspects of that case, which according to the Hon’ble Supreme Court, gave territorial jurisdiction, were stated thus: “17. We have perused the facts pleaded in the writ petition and the documents relied upon by the appellant. Indisputably, the appellant reported sickness on account of various ailments including difficulty in breathing. He was referred to hospital. Consequently, he was signed off for further medical treatment. Finally, the respondent permanently declared the appellant unfit for sea service due to dilated cardiomyopathy (heart muscles disease). As a result, the Shipping Department of the Government of India issued an order on 12-4-2011 cancelling the registration of the appellant as a seaman. A copy of the letter was sent to the appellant at his native place in Bihar where he was staying after he was found medically unfit. It further appears that the appellant sent a representation from his home in the State of Bihar to the respondent claiming disability compensation. The said representation was replied by the respondent, which was addressed to him on his home address in Gaya, Bihar rejecting his claim for disability compensation. It is [2023:RJ-JP:23491-DB] (17 of 18) [CW-14226/2023] further evident that when the appellant was signed off and declared medically unfit, he returned back to his home in the District of Gaya, Bihar and, thereafter, he made all claims and filed representation from his home address at Gaya and those letters and representations were entertained by the respondents and replied and a decision on those representations were communicated to him on his home address in Bihar. Admittedly, the appellant was suffering from serious heart muscles disease (dilated cardiomyopathy) and breathing problem which forced him to stay in native place, wherefrom he had been making all correspondence with regard to his disability compensation. Prima facie, therefore, considering all the facts together, a part or fraction of cause of action arose within the jurisdiction of the Patna High Court where he received a letter of refusal disentitling him from disability compensation. 18. Apart from that, from the counter-affidavit of the respondents and the documents annexed therewith, it reveals that after the writ petition was filed in the Patna High Court, the same was entertained and notices were issued. Pursuant to the said notice, the respondents appeared and participated in the proceedings in the High Court. It further reveals that after hearing the counsel appearing for both the parties, the High Court passed an interim order on 18-9-2012 directing the authorities of Shipping Corpn. of India to pay at least a sum of Rs. 2.75 lakhs, which shall be subject to the result of the writ petition. Pursuant to the interim order, the respondent Shipping Corpn. of India remitted Rs.2,67,270/- (after deduction of income tax) to the bank account of the appellant. However, when the writ petition was taken up for hearing, the High Court took the view that no cause of action, not even a fraction of cause of action, has arisen within its territorial jurisdiction.” 17. It is, thus, clear that the decision in the case of Nawal Kishore Sharma Vs. Union of India & Others (supra) is distinguishable on facts of the present case. 18. It would have been entirely different situation, had the respondents rejected petitioner’s claim of exemption from payment of customs duty on the ground that though all other requirements of notification no. 50/2023-Customs dated 25.08.2023 have been fulfilled, the petitioner is not exempted [2023:RJ-JP:23491-DB] (18 of 18) [CW-14226/2023] from payment of customs duty only on the ground of difference in mode of payment. That is not the case factually made out in the present case. In the writ petition, it has been stated that a mail was sent for grant of clearance of goods, but the same has not been accepted. It has not even been averred categorically in the writ petition that the only operative reason was difference in mode of payment. It, therefore, appears to us that though the petitioner’s grievance is mainly on account of non-clearance of goods despite fulfillment of the conditions incorporated in notification no. 50/2023-Customs dated 25.08.2023, on an assumption, without any factual basis, writ petition has been filed before this Court that benefit of exemption has been disallowed only on the basis of difference in mode of payment. Keeping that fine, but clear distinction as also applying the principle that the issue of territorial jurisdiction has to be decided on the pleadings as made in the writ petition, we are of the view that this Court lacks territorial jurisdiction to decide the merits of the case and the petitioner ought to have approached the appropriate forum. 19. In the result, the objection to the maintainability of the writ petition on the ground of lack of jurisdiction is sustained and the writ petition is dismissed, leaving the petitioner to work out its remedy before the appropriate forum. (PRAVEER BHATNAGAR),J (MANINDRA MOHAN SHRIVASTAVA),J MANOJ NARWANI / "