Wednesday, July 22, 2015

When an Attorney General represents a private party

Mukul Rohatgi is not the first Attorney General to apply for and obtain permission from the Central government to represent private parties in a given case. According to senior advocates of the Supreme Court, many of his predecessors, including M.C. Setalvad, C.K. Daphtary and Soli Sorabjee have used this option to represent private parties after assuming office as the AG.

However, opinion among them is sharply divided over whether there is a compelling enough reason to justify Rohatgi’s appearance for a four-star hotel (Hotel Sky Pearl) in its civil appeal in the Supreme Court against the Kerala Government on July 10.

The Central government, through successive office memorandums (OMs) issued in 2011, 2012 and 2014, has advised its law officers – including the AG – not to apply for relaxation of the rules barring their private practice “in a routine manner” but to avail this option only in exceptional cases with a compelling reason.

Rule 8(1)(a) of the Law Officer Conditions of Service Rules, 1987 says that a law officer shall not hold briefs in any court for any party except the Government of India or the government of a state or any university, government school or college, local authority, Public Service Commission, Port Trust, Port Commissioners, government aided or government managed hospitals, a government company as defined in Section 617 of the Companies Act, 1956, any corporation owned or controlled by the state, and any body or institution in which the government has a preponderating interest.

The term “law officer” here refers to the AG, the Solicitor-General, and the Additional Solicitor-General.

‘Exceptional cases’ rule

Rule 10 provides that where the Central government is of the opinion that it is necessary or expedient to do so, it may, by order, and for reasons to be recorded in writing, relax any of the provisions of these rules. A proviso to Rule 10 says that Rule 8 shall not be relaxed in relation to any matter where the Government of India or any Central government instrumentality is or is likely to be affected.

The latest OM on the subject was issued on October 24, 2014, and it reiterates the position that permission for law officers to appear in private cases in relaxation of the rules will be accorded only in exceptional cases. The OM, however, is silent on what makes a particular case exceptional. Similar OMs issued earlier on December 5, 2012 and August 26, 2011 have been cited.

The OMs regret the fact that law officers request permission to appear in private cases in a routine manner. “Sometimes, the number of requests is so large that it tends to take away sizeable amount of time of the law officer in private matters and in the process, their prime attention in Government cases suffers”, the latest OM says. Therefore, it requests law officers to restrain themselves from seeking permission to appear in private cases. “Any such request in future should be made only for compelling reasons and in exceptional circumstances. Prior approval of the ministry in all such cases may please be obtained”, the OM adds.

According to Ashok Desai, former Attorney-General, there is an interesting background to the framing of these rules in 1987, when Ashoke Kumar Sen was the Union Law Minister in Rajiv Gandhi’s government. Sen had commissioned a study on the AG’s office and pursuant to this, he wanted to change the rules so as to restrict the right of the AG to appear for private parties.

Prior to this, there was absolutely no restriction on law officers appearing for private parties, except for the restriction that they should not appear against the Union of India. Sen replaced this with a blanket ban on representing any party other than a specified list of bodies.

Despite this change in the rules, Desai recalls that late G.Ramaswamy, the AG between December 1990 to November 1992, appeared against the state of Karnataka in the Khoday Distilleries Limited case, claiming that he had obtained permission from the government. (Khoday Distilleries Limited and Others vs State of Karnataka and others, W.P.(c) 666/1990, disposed of on December 15, 1990)

Desai, who was AG between 1996 and 1998, did not appear for a private party. Although he is in principle opposed to the practice of law officers appearing for private parties, he does not want to comment on the propriety of his successors doing so.

Soli J. Sorabjee, who held the AG’s office from 1998 to 2004, recalls that he did appear for a private party while holding office  after obtaining permission from the government because he had represented the client earlier in the Madras High Court. When the case was being heard in the High Court, K.Parasaran, who had been the AG from 1983 to 1989, was the counsel appearing in that case for the opposite party.

Sorabjee sees nothing wrong in Rohatgi appearing for a four-star hotel in the bar licence case, because there is no stated policy of the Central government on this issue.

Critics of the AG’s appearance for a private party in the bar licence case have contended that his action conflicts with Article 47 of the Constitution, which directs the state to endeavour to bring about prohibition of the consumption, except for medicinal purposes, of intoxicating drinks and of drugs which are injurious to health.

Sorabjee’s answer to this is that the AG is challenging the state government’s policy of discrimination (between four star and five star hotels) in the guise of pursuing the directive to bring about prohibition, and not challenging the policy of prohibition itself.

The former Solicitor-General, Mohan Parasaran, however, is categorical that the bar licence case is not an exceptional case to which the government could grant permission to the AG to appear for a private party, as the Constitution obliges the government to bring in prohibition.

There are 23 appellants in the bar licence case currently being heard by the two judge bench of Justices Anil R.Dave and R.K.Agrawal. The next hearing of the case is on July 28.

Rule of thumb
A senior advocate of the Supreme Court suggests that certain factors do make a case exceptional so as to require a law officer to request relaxation of the rule barring him from private practice. He cited three such reasons.

First, it may be a part-heard case. Withdrawal from the case, due to the counsel’s appointment as the law officer, would mean the case has to be reargued all over again. The burden will be on the client, who has to bear the extra costs.

Secondly, the case may be a pro-bono commitment of a law officer, before his appointment. Or, it might involve payment of concessional fee by a client. Another senior counsel of the same eminent category may not be willing to argue the case for the same concessional fee.

Thirdly, the officer may wish to appear for a family friend, who might be, for instance, involved in a divorce proceeding; therefore, the appearance of the law officer for the private party may be essential in the interest of the client and this may not compromise the interests of the government.

These are not exhaustive of the factors which make a case “exceptional” so as to justify a law officer’s request to relax Rule 8 (1) (a) by the Government. Each case has to be examined on its own merits.

Rohatgi’s appearance for Hotel Sky Pearl and against the Kerala government may not violate the proviso to Rule 10 cited earlier, as he has not taken up a brief against the Central government. It is not unusual for law officers of the Union to argue against a state government. But does it qualify to be an exceptional case, in terms of the OMs?

The OMs themselves came to be issued because the government was embarrassed by the frequency of requests from law officers for relaxation of Rule 8(1)(a). The practice of liberal grant of permission to similar requests earlier probably encouraged the potential seekers of such permission, resulting in a spurt of such requests, which, in turn, led to repeated OMs on the subject since 2011.

Whatever the background, the OMs make it clear that the law officers must restrain themselves, and ought not to request relaxation of the rules, except for compelling reasons, to be recorded in writing.

Kerala liquor case
Rohatgi appeared for the respondents in State of Kerala vs B. Surendra Das, which was decided by Justices H.L. Gokhale and J.Chelameswar on March 5, 2014. In this case, the respondent, B. Surendra Das, owner of a three-star hotel had successfully challenged in the Kerala High Court the state government’s move to make three-star hotels ineligible for the grant of licences for the sale of Indian Manufactured Foreign Liquor. The Supreme Court set aside the High Court’s order, and upheld the state government’s move, but cautioned the government not to make four-star hotels too ineligible for the grant of licences until the report of a commission, appointed by the government, is received.

With the Kerala High Court upholding the state government’s policy to make even four-star hotels ineligible for the grant of bar licences on March 31 this year, the aggrieved hotels are once again before the Supreme Court challenging the High court’s order.

The issues in B. Surendra Das and Hotel Sky Pearl may be the same, but the factual matrix is different. According to Anupam Lal Das, advocate in Rohatgi’s team, the AG appeared for a different client representing a four-star hotel in B. Surendra Das, as Sky Pearl was not one of the respondents in that case, but that cannot be a reason why he cannot appear for Sky Pearl now, as he continues to represent the interests of four-star hotels, whoever be the client.

Whether the government has given a speaking order in favour of the AG’s appearance for the private party in this fresh case before the Supreme Court, as required by Rule 10, is another question whose answer could throw light on the correctness of the AG’s move to represent a private party in this case.

A senior advocate of the Supreme Court put it succinctly: “Who can decide whether a law officer has a compelling reason to appear for a private party? Should the government decide, or leave it to the law officer concerned?”

The grey area this question involves may finally come to the rescue of the AG.
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