'You Have To Follow Due Process Of Law' : Supreme Court Rejects UP Govt's Objections To Refund Of Crores Recovered From Anti-CAA Protesters Before 2020 Act

The Supreme Court had reprimanded the state government for affecting recoveries in violation of its judgments in Kodungallur Film Society (2018) and In Re: Destruction of Public and Private Properties (2009) where, in the absence of legislation, guidelines were stipulated to assess damages and award compensation wherever a mass destruction to property takes place due to agitations. The Court had warned the state that lest the State withdraws the proceedings, the court would quash the same.

On Friday, Senior Advocate Garima Prashad, Additional Advocate General for the state of UP, submitted, "The state government has humbly honoured your lordships' observations and in compliance, all the earlier show-cause notices and all the subsequent proceedings, all of them have been withdrawn. Two government orders were issued on 14th and 15th February with directions that all sets of show cause notices and subsequent proceedings be withdrawn, all commissioners and district magistrates were so directed. As of date, all of the same stand withdrawn"

"That is good", said Justice D. Y. Chandrachud. "We appreciate the gesture", said Justice Surya Kant.

Further, adding that the files in respect of all the 274 notices have been sent to the respective claims tribunal constituted under the Uttar Pradesh Recovery of Damages to Public and Private Property, 2020, Ms. Prashad sought liberty to take recourse to the new law.

"The state says the intent of the 2009 and 2018 judgments has been fulfilled since the past two years, from the date of the 2020 Act, there has been not even a single incident of violence or damage to public property", she advanced.

At this, Justice Chandrachud observed, "When we delivered those judgments in 2009 and 2018, the idea was that there has to be accountability when public property is damaged. But our concern was that this should be through a process which is overseen by judicial minds. Ultimately state properties have to be safeguarded, but at the same time, there has to be a judicial forum which deals with it, so that the due process is ensured. That is the thrust of our two judgments. You have brought in a legislation and this can now be considered as per the new legislation, there is no difficulty"

The bench then proceeded to pass the following order- "The state of Uttar Pradesh has submitted through Ms. Garima Prasad, senior counsel and AAG, that on 14th and 15th February 2022, 2 government orders have been issued in terms of which show cause notices which were issued in 274 cases for alleged destruction of public property since December 2019 have been withdrawn together with the proceedings which were subsequently carried out pursuant to the notices by the additional district magistrates. In view of the enactment of the Uttar Pradesh recovery of damages to public and private property act 2020, it has been stated that the state government would refer all the above cases to the claims Tribunal which has been constituted in pursuance of the state legislations for further action in accordance with the law. The state government, it is clarified, would be at liberty to proceed in accordance with the law under the state legislation of 2020 which has been noted above"

Further, it was urged before the bench that rickshaw pullers, fruit sellers etc have had to sell their carts on account of the recovery proceedings which now stand withdrawn by the state.

At this, the bench added in its order, "Since the orders in pursuance of the show cause notices have been withdrawn in pursuance of the GOs, there shall be refund of any recovery made in the meantime. This will however be without prejudice to such action as may be warranted in terms of the proceedings before and the decision of the claims Tribunal at a subsequent stage"

Ms. Prashad insisted that in view of the Model Code of Conduct being in force in the state, the refund, as well as the release of attachments, would pose difficulties.

Justice Chandrachud asked, "When you are enforcing the judgment of this court, how does the MCC come in? The MCC cannot come in the way of the law! And this is law, not policy!"

"Your Lordships may please direct status quo to be maintained. We assure you that everything will be maintained. The order for refund will come in the way. Please let both parties go to the tribunals", prayed Ms. Prashad

Justice Chandrachud noted, "Imagine the property has been attached, the order pursuant to which that was done has been withdrawn, can we say that the attachment would still continue? Is there a provision in the Act for attachment before judgment? I doubt there is. Once the orders have been withdrawn, we cannot say the attachment will continue. Move the tribunal for such relief"

"How much is the recovery by the way?", asked the judge. "Worth crores", she replied.

Justice Surya Kant remarked, "We have no doubt as to the competence of the state. As soon as the tribunal holds them entitled to or responsible for any damage, we are sure you will issue the lawful process and recover"

"The message Your Lordships' judgment sought to convey was that such acts cannot take place. With the refund, the deterrence will go, please see the message which will go", pressed Ms. Prashad

Justice Chandrachud said, "In our judgment, we have not said you cannot pursue claims against damage to public property. But you have to follow due process of law. Therefore, if you establish your case before the claims Tribunal, you can pursue the remedies in accordance with the law"

Ms Prashad continued to persist, "These amounts and these attachments will remain as security with the claims Tribunal. Both parties can approach the claims Tribunal. But the message which will go to the public will be that the amount has been refunded and the entire process is illegal and no such recovery can be made!"

Justice Chandrachud said, "We will clarify that the basis for ordering a refund is because the show cause notices have been withdrawn and therefore it has not become necessary for us to express any view on the merits of the allegations. We have said you can move under the Act. But all consequences of withdrawal have to follow"

Continuing, the judge said, "There is a certain category of cases where we don't grant refund. But those are cases of unjust enrichment to a business house. Because the burden of the taxation is passed to the ultimate consumer. In Mafatlal, we have said no to refund to a private entity. We have to follow yardsticks of our own constitutional jurisprudence. In India Cement, we held that though the cess was wrongly collected by the state, you will not order refund because the entities have already passed on the burden of the tax"

Ms. Prashad argued, "These are not small vendors. This is not the case. The entire law will be frustrated. This will lead to serious consequences. The Message to the public will be that amount has been refunded or no action will be taken"

Justice Surya Kant said, "Law cannot be frustrated because you have just brought in new law and you will give full effectiveness to it. You will appoint good people, with able composition of the tribunal, they will decide matter immediately"

Justice Chandrachud also observed, "All deterrence under the provisions of law has to be provided within the four corners of law. There cannot be any provision for deterrence outside the fold of law. This is a very important principle. It is as simple as that"

"Article 142 gives the jurisdiction to us. It is our constitutional duty to give effect to our own orders and pass orders so that people don't have to run around", added the judge.