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The court said ultimately, the objective of offering a reward to the informer is to aid the department in taking measures to safeguard the public exchequer.
A division bench of the Bombay High Court comprising Justice Nitin Jamdar and Justice Abhay Ahuja has recently observed that informers take enormous risks in providing information and as per the policy it is desirable that immediately upon conclusion of the adjudication, the final reward be released as an incentive to improve compliance.
The high court was hearing a plea filed by the wife of the deceased who was an informer and had died in 2010. The informant had provided a tip to the Customs Office in 1991 with respect to the import and storage of the smuggled diamonds in respect of the Business entity. The information was then given to the Assistant Commissioner of Customs (P), Marine and Preventive Wing of the Customs Commissionerate. Based on the information, the premises of the jewellers were searched in March 1991, and rough diamonds worth Rs. 3.21 lakhs and polished diamonds worth Rs. 84.47 lakhs were recovered.
The case was decided by the Commissioner of Customs in 1992 and the said entity filed an appeal before the appellate tribunal and also a writ petition before the High Court. The proceedings reached the apex court which then remanded it back to the tribunal which disposed of the case in 2011.
During the said period the informant was given Rs. 1 lakh and Rs. 2 Lakh in 1991 and 1993 respectively.
Subsequently, the informant made several representations between 2006-2007 before the commissioner. After his death in 2010, the wife of the informant made several representations but did not receive any satisfactory reply except that the matter was under process.
The wife then approached the High Court seeking a final reward under the Guidelines for grant of reward to Informers and Government Servants, 2015, framed by the Central Board of Excise and Customs (Anti-Smuggling Unit).
The Custom Authorities opposed her plea on the ground that the identity of the informant was disputed and argued that she was not the wife of the same informant who was paid in 1991 and 1993.
The court said that the claim of the petitioner could not be rejected on grounds of identity and that the court had noted that the signature on the receipt of the interim reward was tallied with the name of the informant.
The court further said though there is no legal right to demand a reward, the rejection should not be arbitrary. The order read,
“The policy under the Circular of 2015, postulates rewards for information. Clause 7.2, which postulates the time limit to sanction the final reward, emphasizes that it is desirable that immediately upon conclusion of the adjudication, the final reward be released as an intensive to improve compliance. Though there is no legal right to demand a reward, as stated in the policy, the rejection must not be arbitrary, and the approach should not be such that it discourages the Informers from coming forward.”
The bench observed that informers take enormous risks in providing information and said,
“Ultimately, the objective of offering a reward to the Informer is to aid the department in taking measures to safeguard the public exchequer. The Informers take enormous risks in providing information.”
While noting that it was a fit case for interference and non-intervention would amount to failure of justice the bench said
“Unfortunately, in this case the Respondents have taken a rigid stand, when the correct approach would have been to go by broad probabilities of the case, the peculiar circumstances of the case and the hardship of the Petitioner and should have handled this case with sensitivity. Having concluded that the Petitioner’s claim is meritorious, we find that this is a fit case where the interference of the Court is necessary. In the facts of this case, non-intervention by us in the writ jurisdiction would amount to a failure of justice.”
The court then said that the informant was eligible for a reward and the authorities should decide as per the policy the amount to be paid in 12 weeks.
Case title: Jayashree Chandrakant Dhavre vs UOI
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