The High Court of Delhi has held that the re-filing of the petition seeking identical relief after unconditional withdrawal of the previous petition by the petitioner is unsustainable and barred on the principle of the issue of estoppel as liberty being specifically declined to the petitioner and also the petitioner was subsequently found culpable in the investigation.
The petitioner, Jetibai Grandsons Services India Pvt Ltd was represented by Mr. Sahil Yadav and the respondent revenue, Union of India and others, were represented by Mr. Bhagvan Swarup Shukla with Ms Sunita Shukla along with Mr. Harpreet Singh, Mr. Jatin Kumar Gaur & Ms. Suhani Mathur.
The petitioner sought a declaration that the reversal of the Input Tax Credit ( ITC ) by the respondents on July 22, 2021, was illegal, along with a refund of ITC amounting to Rs 19,65,00,000.
However, the respondents raised a preliminary objection, contending that the petitioner had previously filed a similar petition, WP (C) 10647/2021, which was unconditionally withdrawn on October 29, 2021.
The respondent revenue argued that the petitioner’s current petition sought identical relief to a previously withdrawn petition, indicating abuse of legal process. They emphasised the findings of a culpability investigation and issuance of a show cause notice, indicating the petitioner’s liability.
The court noted that during the hearing of the earlier petition, WP (C) 10647/2021, the petitioner, represented by Mr. Sahil Yadav, had withdrawn the petition without any liberty granted. This withdrawal was made despite the investigation being incomplete. Further, it was revealed that an investigation had found the petitioner culpable, leading to a Show Cause Notice ( SCN ) being issued.
The bench emphasised that the petitioner’s director, Mr. Tarun Jain, had failed to join the investigation, leading to the issuance of a show cause notice.
The court, explaining the principle of estoppel, referred to previous judgments, including Sarva Shramik Sanghatana vs State of Maharashtra, highlighting the principle that withdrawing a petition without liberty to file a fresh one should be discouraged to prevent “bench hunting” tactics. The bench also cited Sarguja Transport Service vs STAT, which emphasised the extension of Order 23 Rule 1 CPC principles to writ petitions to discourage litigants from engaging in such practices.
The bench emphasised that bench hunting, wherein litigants withdraw petitions in hopes of seeking a more favorable bench, should be discouraged in the interest of justice and public policy.
The court observed that the petitioner withdrew the previous petition unconditionally when it seemed the bench was not agreeing with them, without any offer for amicable settlement from the respondents. Moreover, the refusal of liberty by the court during the withdrawal indicated the lack of agreement with the petitioner’s contentions.
Despite the petitioner’s argument that the withdrawal was conditional upon the completion of the investigation, the court held that such a qualification would only be relevant and would only apply if the investigation had exonerated the petitioner. However, since the investigation found the petitioner culpable and a show cause notice had been issued, the withdrawal did not absolve the petitioner of the legal consequences.
The bench ruled that the present petition was barred by the principle of estoppel, rendering it not maintainable. Consequently, W.P. (C) 438/2024 was dismissed.
In result, the division bench comprising Mr. Justice Sanjeev Sachdeva and Mr. Justice Ravinder Dudeja dismissed the petition filed by Jetibai Grandsons Services India Pvt Ltd against Union of India and others, citing the principle of the issue of estoppel.
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