NATIONAL LAW UNIVERSITY DELHI 

SUMMER SESSION: AUGUST-DECEMBER 2010 

 ADMINISTRATIVE LAW

UNDER GRADUATE – V SEMESTER

COURSE FACILITATOR

Dr. JEET SINGH MANN

 

COURSE INDEX Sl

No.Topic Page

No1. Objectives and Evaluation Scheme of the Course 32. Course outline 43. List of projects 114 State of West Bengal and Ors v. The Committee for

Protection of Democratic Rights, West Bengal and Ors 2010(2) SCALE 467

14

4 Uttar Pradesh State Road Transport Corporation and another v. Suresh Chand Sharma and another

35

5 Canara Bank v. Union of India and others 406 A. K. Verma v. Union of India, Ministry of Railways,

through Chairman Railway Board and others44

7 Dewan Consultants and Private Limited v. Union of India and Others

64

8 Khanapuram Gandaiah v. Administrative Officer and Others

93

9Biecco Lawrie Limited and Another v. State of West Bengal and Another

96

10 Union of India and Others v. Naman Singh Sekhawat 10611 Siemons Public Communication Networks Private v.

Union of India and Others118

12 Official Liquidator v Dayanand and Others 13513 Article: Administrative Law and Judicial Review of

Administrative Action: By Justice Markandey Katju180

14 Research Paper: The right to information endeavour from secrecy to transparency and accountability: strngthening the mission of right to information in India: Dr. Jeet Singh Mann, Asstt. Professor of Law, National Law University, Delhi

191

15 Report: LAW COMMISSION OF INDIA: Report No. 215 : L Chandra Kumar be revisited by Larger Bench of Supreme Court : December 2008

192-263

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Course Contour

Administration and administrative law are the all-pervading features of welfare state. Administrative law is evolved to control the abuse or misuse of Government power by public authorities and it’s various instrumentalities within the limits of their power. The focus of the study will be on the ways in which the administration can be kept within the limits of the manner in which legal ideals of fair procedure and just decisions can be infused into the administrative powers of the State. And to remedies available against them. Principles of administrative law, in the absence of a statute, emerge from the judicial scrutiny of the arbitrary exercise of power.

Objectives of the Course:

The challenges of administrative law, like other common law fields, include both the identification of issues and doctrine and the application of doctrine in concrete fact situations. In order to develop these skills, students need to be exposed to a lot of examples of the way judges’ reason in administrative law cases, and must learn to identify the types of arguments that lawyers and judges find compelling.

Learning, not “content delivery” is the objective of the course.

The fundamental objectives of the course are to develop the ability of students to:

Understand basic administrative law rules and concepts;

Identify administrative law issues in concrete fact situations;

Apply administrative law rules and concepts in concrete fact Situations;

Think critically about and evaluate administrative law doctrines.

Teaching-Learning Methodology: Lecture Cum Discussion Method Case Presentation Project Work Court Room Exercise

Evaluation Scheme: (Allocation of marks will be notified before the beginning of semester)

Attendance…………………………………………………....05 % Continuous Assessment (Term Exams)..………..……………20 % Project Work………………………………………………….25 % End Term Examination……………………………………….50%

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COURSE OUTLINE

Module I: Conceptualization and Scope of Administrative Law

1. Evolution and development of Administrative Law2. Concept of Administrative Law3. Amplitude of administrative Law4. Constitutional Law and Administrative Law5. Theory of Separation of Powers: Legislative, Executive and Adjudicatory6. Rule of Law—Dicey’s Rule of Law

Reading Material: Books:

1. I. P. Massey, Administrative Law, 5TH Edn (Eastern Book Company, Lucknow, 2003) chapters 1 & 2 (pages 1- 33)

2. M.P. Jain & S.N. Jain, Principles Of Administrative Law, 4th Edn, (Wadhwa and Company, Nagpur, 2005) , Chapters – 1 (pages. 9-26)

3. Sir W. Wade, Administrative Law, 8TH Edn., (Universal law Publishing Co. Pvt. Ltd., 2000) chapters 1 & 2 ( pages 3 – 35)

Case law:

1. Asif Hameed v. State of J & K, AIR 1989 SC 18992. P. Kannadasan v. State of T.N., (1996) 5 SCC 6703. Ramjawaya v. State of Punjab, AIR 1955 SC 5494. State of M.P. v. Bharat Singh, AIR 2003 SC 11705. Tata Cellular v. U.O.I, (1994) 6 SCC 6516. Vineet Narain v. U.O.I, (1998) 1 SCC 2267. Welfare Assn A.R.P, Maharashtra v. R.P. Gohil, AIR 2003 SC 3078

Module II: Administrative Actions and Role of Tribunals

1. Concept of Administrative Actions2. Classification of Administrative Actions3. Constitution of India: Articles 323A & 323 B4. Overview of Tribunals in India with special reference to Administrative Tribunals

established under the Administrative Tribunals Act, 19855. Legal status and Jurisdiction

Reading Material:Books:

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1. I. P. Massey, Administrative Law, 5TH Edn (Eastern Book Company, Lucknow, 2003) chapters 3 ( pages 41-68)

2. Sir W. Wade, Administrative Law,8TH Edn., (Universal law Publishing Co. Pvt. Ltd., 2000) Part IV & V, especially chapters 8 & 11

Case law:

1. APHL Conference v. W. A. Sangma, AIR 1977 SC 21552. L. Chandra Kumar. v. U.O.I, AIR 1997 SC 11253. Province of Bombay v. Khushal Das Advani, AIR 1950 SC 2224. State of T.N. v. S. Thangaval , (1997) 2 SCC 3495. State of West Bengal v. Ashish Kumar Roy, AIR 2005 SC 254

Module III: Delegated Legislation

1. Meaning, reasons for growth, permissible limits of delegation of legislative power, conditional legislation

2. Control of delegated legislation3. Judicial control4. Procedural safeguards- pre & post publication, consultation of affected interests5. Legislative controls- laying requirements, parliamentary committees on

subordinate legislation

Reading Material: Books:

1. I. P. Massey, Administrative Law, 5TH Edn (Eastern Book Company, Lucknow, 2003) chapters 4 ( pages 72-133)

2. M.P. Jain & S.N. Jain, Principles Of Administrative Law, 4TH Edn, (Wadhwa and Company, Nagpur, 2005) , Chapters – 2 & 3 (pages 26-106)

3. P.P. Craig, Administrative Law, (Sweet & Maxwell, London, Indian print, 2002), Chapter-7(pages 243-270)

4. Sir W. Wade, Administrative Law,8TH Edn., (Universal law Publishing Co. Pvt. Ltd., 2000) Part VIII, chapters 23 (pages 839-883)

Case law:1. Atlas Cycle Industries Ltd. v. State of Haryana, AIR 1979 SC 11492. Darshan Lal Mehra v. U.O.I, AIR1992 SC 18483. Govind Lal v. A.P.M. Committee , AIR 1976 SC 2634. In Re Delhi Laws Act, AIR 1951 SC 3325. Lachmi Narain v. U.O.I, (1976) 2 SCC 9536. Raj Narain v. Chairman, Patna administration committee, AIR 1954 SC 5197. Secy. Ministry of Chemicals & Fertilizers v. Cipla Ltd., AIR 2003 SC 30788. State of T.N. v. P. Krishnamurthy, AIR 2006 SC 1622

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Module IV: Principles of Natural Justice

1. Concept of Natural Justice: Audi Alterm Partum2. Distinction between administrative and quasi judicial functions3. Rule against Bias4. Rule of fair hearing5. Pre & post decisional hearing6. Requirement of passing speaking/reasoned order7. Requirement of supplying enquiry report

Reading Material:Books:

1. I. P. Massey, Administrative Law, 5TH Edn (Eastern Book Company, Lucknow, 2003) chapters 3 & 6 ( pages 161-228)

2. M.P. Jain & S.N. Jain, Principles Of Administrative Law,4TH Edn, (Wadhwa and Company, Nagpur, 2005) , Chapters – 7& 8

3. P.P. Craig, Administrative Law, (Sweet & Maxwell, London, Indian print, 2002), Chapters-8 & 9

4. Sir W. Wade, Administrative Law, 8TH Edn., (Universal law Publishing Co. Pvt. Ltd., 2000) Part VI, chapters 13, 14 & 15

Case law:Nemo Judex in causa sua

1. A.K. Kraipak v. U.O.I, AIR 1970 SC 1502. Amar Nath Chaudhary v. Braithwaite & Co. Ltd. , (2002) 2 SCC 2903. Ashok Kr. Yadav v. State of Haryana, (1985) 4 SCC 4174. G. N. Nayak v. Goa University, (2002) 2 SCC 712

Rule of fair hearing1. Canara Bank v. V. K. Awasthy, AIR 2005 SC 20902. Hira Nath Mishra v. Principal, Rajendra Medical College, AIR 1973 SC 12603. J. K. Agarwal v. Haryana Seeds Development Corop. Ltd, AIR 1991 SC 12214. Swadeshi Cotton Mills ltd. v . U.O.I, (1981) 1 SCC 6645. U.O.I v. Tulsi Ram Patel, (1965) 3 SCC 398

Pre & post decisional hearing1. H. L. Trehan v. U.O.I, (1989) 1 SCC 7642. Maneka Gandhi v. U. O. I., (1978) 1 SCC 248

Requirement of passing speaking/reasoned order1. S.N. Mukherjee v. U.O.I, (1990) 4 SCC 5942. Tara Chand v. MCD (1977) 1 SCC 472

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Requirement of supplying enquiry report1. M.D., ECIL, Hyderabad v. B. Karunakar, (1993) 4 SCC 772. P. D. Agarwal v. State Bank of India, 2006(5) SCALE 543. State of U.P. v. Harendra Arora, (2001) 6 SCC 392

Other Cases1. Canara Bank v. Shri Debojit AIR 2003 SC 20412. In Re V. C. Mishra, (1995) 2 SCC 5843. Liberty oil Mills v. U.O.I., AIR 1984 SC 12714. Rajendra Consumer Co. v M. H A. Development Authority, AIR 2005 SC 3701

Module V: Judicial Review of Administrative Discretion

1. Grounds of Judicial Review: Arbitrariness, discrimination, unreasonableness, Bad faith, Malafide, Non exercise of power

2. Review and appeal distinguished, power of judicial review of the respective courts under Articles 32, 136, 226 & 227

3. Rules restricting judicial review- locus standi, laches, res judicata, exhaustion of alternate remedies etc.

4. Writs- general conditions for the issuance of writs, the scope of review through writs, Curative petition, Public interest litigation

5. Doctrine of legitimate expectation & distinction with promissory estoppel6. Doctrine of proportionality

Reading Material:Books:

1. M.P. Jain & S.N. Jain, Principles Of Administrative Law,4TH Edn, (Wadhwa and Company, Nagpur, 2005) , Chapters 9 Chapters 13 , 14 & 15

2. P. Massey, Administrative Law, 5TH Edn (Eastern Book Company, Lucknow, 2003) chapters 3 & 4 ( pages 54- 68) 7, 8 & 9

3. P.P. Craig, Administrative Law, (Sweet & Maxwell, London, Indian print, 2002), Chapter- 14

4. Sir W. Wade, Administrative Law,8TH Edn., (Universal law Publishing Co. Pvt. Ltd., 2000) Part V, chapters 11 & 12, Part VII

Cases:Meaning of Discretion1. CCSU V. Minister for Civil Services [1984] 3 All ER 9352. Indian Railway Construction Co. Ltd v. Ajay Kumar, (2003) 4 SCC 579

Arbitrariness / discrimination / unreasonableness1. A.N. Parsuraman v. State of T.N, AIR 1990 SC 40

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2. Dwarka Pd. Laxmi Narain v. St. of U.P., AIR 1954 SC 224 Bad faith/Malafide

1. Express Newspapers (p) Ltd. v. U. O .I, AIR 1986 SC 8272. G. Sadanandan v. State of Kerala, AIR 1966 SC 19253. Pratap Singh v. State of Punjab, AIR 1964 SC 724. State of Punjab v. V. K. Khanna (2001) 2 SCC 3305. U.O.I v. Malti Sharma, 2006(2) SCALE 578

Ignoring relevant considerations or reliance on irrelevant considerations

1. Commr. Of Police v. Goardhan Das Bhanji AIR 1952 SC 162. Ram Manohar Lohia v. State of Bihar, AIR 1966 SC 7403. State of Bombay v. K.P. Krishnan, AIR 1960 SC 1223

Non exercise of power

1. Shri Rama Sugar Industries v. State of A.P (1974) 1 SCC 534

Power of judicial review under Articles 32, 136, 226 & 2271. Ekta Shakti Foundation v. Govt. of NCT of Delhi, MANU/SC/3115/20062. Maharashtra State Seeds Corpn. Ltd. v. Haridas, AIR 2006 SC 14803. T.K. Rangarajan v. State of T.N, AIR 2003 SC 30324. Tilok Chand Moti Chand v. H.B. Munshi, AIR 1970 SC 8985.

Ouster clause1. Govt. of Madras v. J. S. Bassappa, AIR 1964 SC 18732. K.C. Wora v. G. Annamanaidu, AIR 1974 SC 1069

Scope of review through writs1. A.T. Sharma v. A.P. Sharma AIR 1979 SC 10472. Anadi Mukta Satguru trust v. V. R. Udaisi ( 1989) 2 SCC 6913. Daryo v. State of U.P., AIR 1961 SC 14574. R.S. Deodhar v. State of Maharashtra , AIR 1974 SC 2595. S.D. Rai v. Ram Chandra Rai, (2003) 6 SCC 6756. Ujjaim Bai v. State of U.P., AIR 1962 SC 16217. Zee Telefilms v. U.O.I, (2005) 4 SCC 649

Curative petition1. Rupa Ashok Hura v. Ashok Hura, (2002) 4 SCC 388

Doctrine of legitimate expectation & promissory estoppel1. Delhi Cloth & Gen Mills v. UOI, ( 1988) 1 SCC 662. Kuldeep singh v. Govt. of NCT of Delhi, dated 6th july 20063. Larsen & Turbo ltd. v. UOI AIR 2005 SC 41804. National Building Construction Co. v. S Raghunathan, (1998)7 SCC 665. Navjyoti Corpn. Group Housing Society v. UOI, (1992) 4 SCC 477

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Doctrine of proportionality1. T. O. Estates (p) ltd v. U.T. Chandigarh, 2003 (10) SCALE 1016

Module VI: Transparency and Accountability in Administrative Actions

1. Doctrine of public accountability2. Institution of Lokpal: Working of Lokayukts in the states3. Right To Information Act, 2005:

a. Scope of right to Information, b. Process of obtaining information, appeal, inspection etc, and c. effectiveness of the scheme

4. Commission Of Inquiry Act 1952: a. object and scopeb. Process and Powers of commission

Reading Material:Books:

1. D. D. Basu, Administrative Law, 6TH Edn, (Kamal Law House, Calcutta, 2005)2. M.P. Jain & S.N. Jain, Principles Of Administrative Law, 6TH Edn, (Wadhwa and

Company, Nagpur, 2007) 3. S.P. Sathe, Administrative Law, 7TH Edn Butterworths India, New Delhi, 2008

Cases:

1. Bombay Pvt. Ltd. And Others, 1988 (004) SCC 0592 SC

2. Dinesh Trivedi, M.P. And Others V. Union Of India And Others, 1997(004)

SCC 0306SC 3. Dr. Baliram v. Mr. Justice B. Zentin, AIR 1988 SC 22674. Electronic and Computer Software Export Promotion Council v. Central

Vigilance Commission, Delhi High Court dated 19/07/06

5. Indian Express Newspapers (Bombay) Private Ltd., And Others, V. Union Of

India And Others, 1985 (001) SCC 0641 SC6. Indira Jaisingh v. Registrar, (2003) 4 SCALE 643

7. Life Insurance Corporation Of India, V. Prof. Manubhai D. Shah, 1992 (003)

SCC 0637 SC

8. People’s Union For Civil Liberties (PUCL) And Another, Petitioner V. Union

Of India And Another, With Lok Satta And Others, V. Union Of India,

2003(001) SCW 2353 SC

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9. People's Union For Civil Liberties (PUCL) And Another, V. Union Of India

And Another, 2002(005) SCC 0361SC10. PUDR v. Ministry of Home Affairs, AIR 1985 Del 26811. R. K. Dalmia v. Justice S.R. Tendulkar , AIR 1958 SC 53812. Reliance Petrochemicals Ltd., V. Proprietors Of Indian Express Newspapers,

Bombay Pvt. Ltd. And Others, 1988 (004) SCC 0592 SC

13. Secretary, Ministry of Information & Broadcasting, Govt. Of India, And Ors,

V. Cricket Association of Bengal And Others, 1995(002) SCC 0161 SC

14. Sheela Barse, V. State Of Maharashtra, 1987 (004) SCC 0373 SC

15. Smt. Prabha Dutt, V. Union Of India And Others, 1982 (001) SCC 0001 SC16. State of Bihar v. L.K. Advani AIR 2003 SC 335717. Tata Press Ltd., V. Mahanagar Telephone Nigam Limited And Others,

1995(005) SCC 0139 SC

18. The State Of U. P., V. Raj Narain And Others, 1975 (004) SCC 0428 SC

19. Union Of India And Others, V. Motion Picture Association And Others,

1999(006) SCC 0150 SC

20. Union Of India V. Association For Democratic Reforms And Another, With ,

People's Union For Civil Liberties (PUCL) And Another, V.

Union Of India And Another, 2002(005) SCC 0361SC

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Name RESEARCH PROJECT TOPICSAbhishek Verma Dicey’s Rule of Law and its present day relevancy.Aditya Sharma Diversity in global administrative law for global governance

Aishani GuptaGlobal explosion of the Right to Information and its impact onadministrative actions

Akal Arpan Singh Brar Delegation of quasi-Judicial function

Akanksha PamaA comparative study of the Judicial Review of administrative actions inUSA, UK and India

Alokika Singh Padfield v. Ministery of Agriculture; 1968 1 All ER 694 House of LordsAman Singh Poras MC Eldouney V. Forde; 1969 2 All ER 1039: A critiqueAmbika Judicial review of administrative policyAnkit Chauhan A Critical study of scope of Commission of InquiryAnshuman Singh Judicial review of non statutory administrative actionsAnu Paarcha Analysis of writ of mandamus in administrative actionApoorva Sharma A Critical study of writ of Habeas Corpus in administrative action.Arjun J. Scope of the Writ of quo-warranto in administrative actionsArjun Masters Scope of the Writ of certiorari and prohibition in qua-judicial action

Bhinav MeenaA critical study of Lokayukt and Lokpal in accountability andtransparency of administration action.

Charu Rawat Impact of the Public Interest Litigation on administration law

Deepti GautamV.K. Jain v. The High Court of Delhi through Registrar General and Ors2009 12 SCALE 192: critical analysis of issues on administrative law

Devesh Saboo Vineet Narain v. U.O.I, (1998) 1 SCC 226: case analysis

Devna AroraA critical study of State of W B and Ors v. The Committee for Protection of Democratic Rights, W B and Ors : 2010(2) SCALE467

Divya SharmaI.R. Coelho (D) by lrs. V. State of Tamil Nadu: (2007) 2 SCC 1:case analysis on judicial review

Gaurav Govinda Constitutionality of Delegated Legislation in India – A critique.Gauri Sachdeva Correlation between natural justice and legal justiceGunjan Chawla Quasi-judicial and administrative powerHardeep Singh Flexibility of the rules of natural justiceHarsh Makhija Constitutional limitations in application of natural justiceJaskaran Singh A critical study of Judicial BiasJasween Singh Gujral Critical analysis of Administrative Bias

John SebastianMajor Jai Gopal Srivastava (Retd.) V. Govt of NCT of Delhi & Ors.WP(C) No.2545/2008. Delhi High Court

K. Sanjana Analysis of the concept of Political Bias in administrative law

Kanika GaubaL. Chandra Kumar v. Union of India and Ors. : (1997) 3 SCC 261:A case analysis

Krutika MisraState of U.P. and Ors. V. Jeet S. Bisht and Anr. : (2007) 6 SCC 586:A critical study

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Kuljeevan Siddharth A critical study of the doctrine of proportionalityKunika Legal Bias: significance in administrative law

M. Ashwin Reddy Legislative Bias in relation to administrative lawMansi Malik Rule of Law and the Indian Judiciary – A critical study.Mitul Jain Critical study of Pecuniary BiasMohit Shripat Impact of Personal Bias in administrative lawMohit Sharma Is there any need to study the classification of administrative actionMonalisa Administrative Adjudication is a Necessity – A comment.Mubashshir Sarshar Doctrine of pleasure and natural justiceNikita Agarwal Droit Administratif – A critical study.Nishant Bhaskar Rigidity of separation of powers in IndiaNishith Mishra Refinement of doctrine of natural justiceNitika Dwivedi Administrative Tribunals Act 1985 – A critical study of the tribunal.Paramvir Singh Restraints on delegated legislationPurushottam Anand A.K. Kraipak Vs Union of India AIR 1970 S.C 150: A critiqueRajat Mathuria Retrospective effect of subordinate legislationRitu Sinha Critical study of the Doctrine of Audi Alterm PartemIrfan S. Analysis of the principle of Nemi Judex in causa sue

Vangala Sai TejaCase analysis of Dwarka Prasad. Laxmi Narain v. State. Of U.P.,AIR 1954 SC 224

Salmoli Choudhuri A.N. Parsuraman v. State of T.N, AIR 1990 SC 40 : a critique

Sameer DawarCanara Bank v. V. K. Awasthy, AIR 2005 SC 2090 :critical study of the case

Sarvjeet Singh Swadeshi Cotton Mills ltd. V . U.O.I, (1981) 1 SCC 664:case analysisSaumya Yadav U.O.I v. Tulsi Ram Patel, (1965) 3 SCC 398 : Case analysisSakshi Prasad Challenges of administrative law

Shanta ChirravuriAtlas Cycle Industries Ltd. V. State of Haryana, AIR 1979 SC 1149:A case analysis

Shivain Vaidialingam State of T.N. v. P. Krishnamurthy, AIR 2006 SC 1622: critical studyShreya Rastogi Ashok Kr. Yadav v. State of Haryana, (1985) 4 SCC 417 : case critique

Shweta Duggalcase analysis of Amar Nath Chaudhary v. Braithwaite & Co. Ltd. ,(2002) 2 SCC 290

Siddharth Garg Doctrine of public accountabilitySonali Transparency and accountability in administrative actions

Soumya ShekharU P SRT Corp and anr v Suresh Chand Sharma and anr Supreme Court of India decided on 26 May 2010 Civil Appeal No. 3086 & 3088 of 2007

Srishti DuttState of Uttaranchal & Anr. Vs. Sunil Kumar Singh Negi AIR 2008 SC 2026 : case study

Swati SareenA case analysis of Municipal Committee, Bahadurgarh Vs. Krishnan Bihari & Ors., AIR 1996 SC 1249

Toshit Shandilya case study of A. K. Verma v Union of India, ; C A T PRINCIPAL BENCH, NEW DELHI decided on 6 May 2010 Original Application No.

12

2799/2009

Upama BhattacharjeeCritical analysis of Delhi Development Authority v. M/s UEE Electricals Engg. Pvt. Ltd., (2004) 11 SCC 213

Varun Eknath Schmidt v. Secy. of State, (1969) 1 All ER 904Vikramaditya State of Karnataka vs. H. Nagaraj [(1998) 9 SCC 671 : A case study

Vinayak BhandariCouncil of Civil Service Unions vs. Minister for the Civil Service[1985] A.C. 374

Vinita Yadav Whistleblower protection and its recognition in administrative law

Vishwam JindalAssociated Provincial Picture Houses Ltd. V. Wednesbury Corpn,(1947) 2 All ER 680: A case analysis

Yuvraj Singh Impact of E-GOVERNMENT on Administrative Law

Akshay BangarpetR. (Bradley) v. Secretary of State for Work and Pensions[2009] Q.B. 114 : A critical study

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State of West Bengal and Ors v. The Committee for Protection of Democratic Rights, West Bengal and Ors 2010(2) SCALE 467 Decided

On: 17.02.20101

D.K. Jain, J.

1. The issue which has been referred for the opinion of the Constitution Bench is whether the High Court, in exercise of its jurisdiction under Article 226 of the Constitution of India, can direct the Central Bureau of Investigation (for short "the CBI"), established under the Delhi Special Police Establishment Act, 1946 (for short "the Special Police Act"), to investigate a cognizable offence, which is alleged to have taken place within the territorial jurisdiction of a State, without the consent of the State Government.

2. For the determination of the afore-stated important legal issue, it is unnecessary to dilate on the facts obtaining in individual cases in this bunch of civil appeals/special leave petitions/writ petitions and a brief reference to the facts in Civil Appeal Nos. 6249- 6250 of 2001, noticed in the referral order dated 8 th November, 2006, would suffice. These are: One Abdul Rahaman Mondal (hereinafter referred to as, "the complainant") along with a large number of workers of a political party had been staying in several camps of that party at Garbeta, District Midnapore, in the State of West Bengal. On 4 th January, 2001, the complainant and few others decided to return to their homes from one such camp. When they reached the complainant's house, some miscreants, numbering 50-60, attacked them with firearms and other explosives, which resulted in a number of casualties. The complainant managed to escape from the place of occurrence, hid himself and witnessed the carnage. He lodged a written complaint with the Garbeta Police Station on 4 th

January, 2001 itself but the First Information Report ("the FIR" for short) for offences under Sections 148/149/448/436/364/302/201 of the Indian Penal Code, 1860 (for short "the IPC") read with Sections 25/27 of the Arms Act, 1959 and Section 9(B) of the Explosives Act, 1884 was registered only on 5 th January, 2001. On 8th January, 2001, Director General of Police, West Bengal directed the C.I.D. to take over the investigations in the case. A writ petition under Article 226 of the Constitution was filed in the High Court of Judicature at Calcutta by the Committee for Protection of Democratic Rights, West Bengal, in public interest, inter alia, alleging that although in the said incident 11 persons had died on 4th January, 2001 and more than three months had elapsed since the incident had taken place yet except two persons, no other person named in the FIR, had been arrested; no serious attempt had been made to get the victims identified and so far the police had not been able to come to a definite conclusion whether missing persons were dead or alive. It was alleged that since the police administration in the State was under the influence of the ruling party which was trying to hide the incident to save its image, the investigations in the incident may be handed over to the CBI, an independent agency.

1 Hon'ble Judges: K.G. Balakrishnan, C.J., R.V. Raveendran, D.K. Jain, P. Sathasivam and J.M. Panchal, JJ.

3. Upon consideration of the affidavit filed in opposition by the State Government, the High Court felt that in the background of the case it had strong reservations about the impartiality and fairness in the investigation by the State police because of the political fallout, therefore, no useful purpose would be served in continuing with the investigation by the State Investigating Agency.

Moreover, even if the investigation was conducted fairly and truthfully by the State police, it would still be viewed with suspicion because of the allegation that all the assailants were members of the ruling party. Having regard to all these circumstances, the High Court deemed it appropriate to hand over the investigation into the said incident to the CBI.

4. Aggrieved by the order passed by the High Court, the State of West Bengal filed a petition for special leave to appeal before this Court. On 3rd September, 2001 leave was granted. When the matter came up for hearing before a two-Judge Bench on 8 th

November, 2006, taking note of the contentions urged by learned Counsel for the parties and the orders passed by this Court in The Management of Advance Insurance Co. Ltd. v. Shri Gurudasmal and Ors. : 1970 (1) SCC 633 and Kazi Lhendup Dorji v. Central Bureau of Investigation and Ors. : 1994 Supp (2) SCC 116, the Bench was of the opinion that the question of law involved in the appeals was of great public importance and was coming before the courts frequently and, therefore, it was necessary that the issue be settled by a larger Bench. Accordingly, the Bench directed that the papers of the case be placed before the Hon'ble Chief Justice of India for passing appropriate orders for placing the matter before a larger Bench. When the matter came up before a three-Judge Bench, headed by the Hon'ble Chief Justice of India, on 29 th August, 2008, this batch of cases was directed to be listed before a Constitution Bench. This is how these matters have been placed before us.

The Rival Contentions:

5. Shri K.K. Venugopal, learned senior counsel appearing on behalf of the State of West Bengal, referring to Entry 80 of List I of the Seventh Schedule to the Constitution of India; Entry 2 of List II of the said Schedule as also Sections 5 and 6 of the Special Police Act strenuously argued that from the said Constitutional and Statutory provisions it is evident that there is a complete restriction on Parliament's legislative power in enacting any law permitting the police of one State to investigate an offence committed in another State, without the consent of that State. It was urged that the Special Police Act enacted in exercise of the powers conferred under the Government of India Act, 1935, Entry 39 of List I (Federal Legislative List) of the Seventh Schedule, the field now occupied by Entry 80 of List I of the Seventh Schedule of the Constitution, replicates the prohibition of police of one State investigating an offence in another State without the consent of that State. It was submitted that Entry 2 of List II which confers exclusive jurisdiction on the State Legislature in regard to the police, the exclusive jurisdiction of a State Legislature cannot be encroached upon without the consent of the concerned State being obtained.

15

6. Learned senior counsel submitted that the separation of powers between the three organs of the State, i.e. the Legislature, the Executive and the Judiciary would require each one of these organs to confine itself within the field entrusted to it by the Constitution and not to act in contravention or contrary to the letter and spirit of the Constitution.

7. Thus, the thrust of argument of the learned Counsel was that both, the federal structure as well as the principles of separation of powers, being a part of the basic structure of the Constitution, it is neither permissible for the Central Government to encroach upon the legislative powers of a State in respect of the matters specified in List II of the Seventh Schedule nor can the superior courts of the land adjure such a jurisdiction which is otherwise prohibited under the Constitution. It was urged that if the Parliament were to pass a law which authorises the police of one State to investigate in another State without the consent of that State, such a law would be pro tanto invalid and, therefore, the rule of law would require the courts, which are subservient to the Constitution, to ensure that the federal structure embodied in the Constitution as a basic principle, is not disturbed by permitting/directing the police force of a State to investigate an offence committed in another State without the consent of that State.

8. Relying heavily on the observations of the Constitution Bench in Supreme Court Bar Association v. Union of India and Anr.: (1998) 4 SCC 409 to the effect that Article 142, even with the width of its amplitude, cannot be used to build a new edifice where none existed earlier, by ignoring express statutory provisions dealing with a subject and thereby to achieve something indirectly which cannot be achieved directly, learned counsel contended that when even Article 142 of the Constitution cannot be used by this Court to act contrary to the express provisions of law, the High Court cannot issue any direction ignoring the Statutory and Constitutional provisions. Learned Counsel went to the extent of arguing that even when the State police is not in a position to conduct an impartial investigation because of extraneous influences, the Court still cannot exercise executive power of directing the police force of another State to carry out investigations without the consent of that State. In such a situation, the matter is best left to the wisdom of the Parliament to enact an appropriate legislation to take care of the situation. According to the learned Counsel, till that is done, even such an extreme situation would not justify the Court upsetting the federal or quasi-federal system created by the Constitution.

9. As regards the exercise of jurisdiction by a High Court under Article 226 of the Constitution, learned Counsel submitted that apart from the fact that there is a significant difference between the power of this Court under Article 142 of the Constitution and the jurisdiction of the High Court under Article 226 of the Constitution because of territorial limitations under Article 226(1) of the Constitution, a High Court is disentitled from issuing any direction to the authorities situated outside the territories over which it has jurisdiction. According to the learned Counsel Clause (2) of Article 226 would have no application in a case, such as the present one, since the cause of action was complete at the time of filing the writ petition and the power under Clause (2) can be exercised only where there is a nexus between the cause of action which arises wholly or partly within

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the State and the authority which is situated outside the State. It was asserted that the CBI being a rank outsider, unconnected to the incident, which took place within the State of West Bengal, the investigation of which was being conducted by the jurisdictional local police in West Bengal, had no authority to take up the case for investigation.

10. Shri Goolam E. Vahanvati, learned Solicitor General of India, appearing on behalf of the Union of India, submitted that the entire approach of the State being based on an assumption that the alleged restriction on Parliament's legislative power under Entry 80 of List I of the Seventh Schedule to the Constitution and restriction on the power of the Central Government under Section 6 of the Special Police Act to issue a notification binds the constitutional courts i.e. the Supreme Court and the High Courts is fallacious, inasmuch as the restrictions on the Central Government and Parliament cannot be inferentially extended to be restrictions on the Constitutional Courts in exercise of their powers under Articles 32 and 226 of the Constitution as it is the obligation of the Superior Courts to protect the citizens and enforce their fundamental rights. Learned Counsel vehemently argued that the stand of the appellants that the exercise of power by the Supreme Court or the High Courts to refer investigation to CBI directly without prior approval of the concerned State Government would violate the federal structure of the Constitution is again misconceived as it overlooks the basic fact that in a federal structure it is the duty of the courts to uphold the Constitutional values and to enforce the Constitutional limitations as an ultimate interpreter of the Constitution. In support of the proposition, learned Counsel placed reliance on the decisions of this Court in State of Rajasthan and Ors. v. Union of India and Ors. : (1977) 3 SCC 592, S.R. Bommai and Ors. v. Union of India and Ors. : (1994) 3 SCC 1 and Kuldip Nayar and Ors. v. Union of India and Ors. : (2006) 7 SCC 1.

11. Relying on the recent decision by a Bench of nine Judges of this Court in I.R. Coelho (D) By LRs. v. State of Tamil Nadu : (2007) 2 SCC 1, learned counsel submitted that the judicial review being itself the basic feature of the Constitution, no restriction can be placed even by inference and by principle of legislative competence on the powers of the Supreme Court and the High Courts with regard to the enforcement of fundamental rights and protection of the citizens of India. Learned Counsel asserted that in exercise of powers either under Article 32 or 226 of the Constitution, the courts are merely discharging their duty of judicial review and are neither usurping any jurisdiction, nor overriding the doctrine of separation of powers. In support of the proposition that the jurisdiction conferred on the Supreme Court by Article 32 as also on the High Courts under Article 226 of the Constitution is an important and integral part of the basic structure of the Constitution, learned Counsel placed reliance on the decisions of this Court in Special Reference No. 1 of 1964 : [1965] 1 S.C.R. 413, Minerva Mills Ltd. and Ors. v. Union of India and Ors. : (1980) 3 SCC 625, Fertilizer Corporation Kamgar Union (Regd.), Sindri and Ors. v. Union of India and Ors. : (1981) 1 SCC 568, Nilabati Behera v. State of Orissa and Ors. : (1993) 2 SCC 746 and L. Chandra Kumar v. Union of India and Ors. : (1997) 3 SCC 261. Relying on the decision of this Court in Dwarkanath, Hindu Undivided Family v. Income-Tax Officer, Special Circle, Kanpur and Anr. : [1965] 3 S.C.R. 536, learned Counsel emphasised that the

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powers of the High Court under Article 226 are also wide and plenary in nature similar to that of the Supreme Court under Article 32 of the Constitution.

The Questions for Consideration:

12. It is manifest that in essence the objection of the appellant to the CBI's role in police investigation in a State without its consent, proceeds on the doctrine of distribution of legislative powers as between the Union and the State Legislatures particularly with reference to the three Lists in the Seventh Schedule of the Constitution and the distribution of powers between the said three organs of the State.

13. In order to appreciate the controversy, a brief reference to some of the provisions in the Constitution would be necessary. The Constitution of India is divided into several parts, each part dealing in detail with different aspects of the social, economic, political and administrative set up. For the present case, we are mainly concerned with Part III of the Constitution, which enumerates the fundamental rights guaranteed by the State primarily to citizens and in some cases to every resident of India and Part XI thereof, which pertains to the relations between the Union and the States.

14. Bearing in mind the basis on which the correctness of the impugned direction is being questioned by the State of West Bengal, we shall first notice the scope and purport of Part XI of the Constitution. According to Article 1 of the Constitution, India is a `Union' of States, which means a Federation of States. Every federal system requires division of powers between the Union and State Governments, which in our Constitution is effected by Part XI thereof. While Articles 245 to 255 deal with distribution of legislative powers, the distribution of administrative powers is dealt with in Articles 256 to 261. Under the Constitution, there is a three-fold distribution of legislative powers between the Union and the States, made by the three Lists in the Seventh Schedule of the Constitution. While Article 245 confers the legislative powers upon the Union and the States, Article 246 provides for distribution of legislative powers between the Union and the States. Article 246, relevant for our purpose, reads as follows:

246. Subject-matter of laws made by Parliament and by the Legislatures of States -- (1) Notwithstanding anything in Clauses (2) and (3), Parliament has exclusive power to make laws with respect to any of the matters enumerated in List I in the Seventh Schedule (in this Constitution referred to as the "Union List").

(2) Notwithstanding anything in Clause (3), Parliament and, subject to Clause (1), the Legislature of any State also, have power to make laws with respect to any of the matters enumerated in List III in the Seventh Schedule (in this Constitution referred to as the "Concurrent List").

(3) Subject to Clauses (1) and (2), the Legislature of any State has exclusive power to make laws for such State or any part thereof with respect to any of the matters enumerated in List II in the Seventh Schedule (in this Constitution referred to as the `State List').

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(4) Parliament has power to make laws with respect to any matter for any part of the territory of India not included in a State notwithstanding that such matter is a matter enumerated in the State List.

15. The Article deals with the distribution of legislative powers between the Union and the State Legislatures. List I or the `Union List' enumerates the subjects over which the Union shall have exclusive powers of legislation in respect of 99 items or subjects, which include Defence etc.; List II or the `State List' comprises of subjects, which include Public Order, Police etc., over which the State Legislature shall have exclusive power of legislation and List III gives concurrent powers to the Union and the State Legislatures to legislate in respect of items mentioned therein. The Article postulates that Parliament shall have exclusive power to legislate with respect to any of the matters enumerated in List I notwithstanding anything contained in clauses (2) and (3). The non obstante clause in Article 246(1) contemplates the predominance or supremacy of the Union Legislature. This power is not encumbered by anything contained in Clause (2) and (3) for these clauses themselves are expressly limited and made subject to the non obstante clause in Article 246(1). The State Legislature has exclusive power to make laws for such State or any part thereof with respect to any of the matters enumerated in List II in the Seventh Schedule and it also has the power to make laws with respect to any matters enumerated in List III (Concurrent List). The exclusive power of the State Legislature to legislate with respect to any of the matters enumerated in List II has to be exercised subject to clause (1) i.e. the exclusive power of Parliament to legislate with respect to matters enumerated in List I. As a consequence, if there is a conflict between an Entry in List I and an Entry in List II, which is not capable of reconciliation, the power of Parliament to legislate with respect to a matter enumerated in List II must supersede pro tanto the exercise of power of the State Legislature. Both Parliament and the State Legislature have concurrent powers of legislation with respect to any of the matters enumerated in List III. The words "notwithstanding anything contained in Clauses (2) and (3)" in Article 246(1) and the words "subject to Clauses (1) and (2)" in Article 246(3) lay down the principle of federal supremacy viz. that in case of inevitable conflict between Union and State powers, the Union power as enumerated in List I shall prevail over the State power as enumerated in Lists II and III and in case of an overlapping between Lists II and III, the latter shall prevail. Though, undoubtedly, the Constitution exhibits supremacy of Parliament over State Legislatures, yet the principle of federal supremacy laid down in Article 246 of the Constitution cannot be resorted to unless there is an irreconcilable direct conflict between the entries in the Union and the State Lists. Thus, there is no quarrel with the broad proposition that under the Constitution there is a clear demarcation of legislative powers between the Union and the States and they have to confine themselves within the field entrusted to them. It may also be borne in mind that the function of the Lists is not to confer powers; they merely demarcate the Legislative field. But the issue we are called upon to determine is that when the scheme of Constitution prohibits encroachment by the Union upon a matter which exclusively falls within the domain of the State Legislature, like public order, police etc., can the third organ of the State viz. the Judiciary, direct the CBI, an agency established by the Union to do something in respect of a State subject, without the consent of the concerned State Government?

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16. In order to adjudicate upon the issue at hand, it would be necessary to refer to some other relevant Constitutional and Statutory provisions as well.

17. As noted earlier, the Special Police Act was enacted by the Governor General in Council in exercise of the powers conferred by the Government of India Act, 1935 (Entry 39 of List I, Seventh Schedule). The said Entry reads as under:

Extension of the powers and jurisdiction of members of a police force belonging to any part of British India to any area in another Governor's Province or Chief Commissioner's Province, but not so as to enable the police of one part to exercise powers and jurisdiction elsewhere without the consent of the Government of the Province or the Chief Commissioner as the case may be; extension of the powers and jurisdiction of members of a police force belonging to any unit to railway areas outside that unit.

It is manifest that the Special Police Act was passed in terms of the said Entry imposing prohibition on the Federal Legislature to enact any law permitting the police of one State from investigating an offence committed in another State, without the consent of the State. The said Entry was replaced by Entry 80 of List I of the Seventh Schedule to the Constitution of India. The said entry reads thus:

Extension of the powers and jurisdiction of members of a police force belonging to any State to any area outside that State, but not so as to enable the police of one State to exercise powers and jurisdiction in any area outside that State without the consent of the Govt. of the State in which such area is situated; extension of the powers and jurisdiction of members of a police force belonging to any State to railway areas outside that State.

Entry 2 of List II of the Constitution of India, which corresponds to Entry 2 List II of the Government of India Act, conferring exclusive jurisdiction to the States in matter relating to police reads as under:

Entry 2 List II:

Police (including railway and village police) subject to the provisions of entry 2A of List I.

Entry 2A of List I:

Development of any armed force of the Union or any other force subject to the control of the Union or any contingent or unit thereof in any State in aid of the civil power; powers, jurisdiction, privileges and liabilities of the members of such forces while on such deployment.

18. From a bare reading of the afore-noted Constitutional provisions, it is manifest that by virtue of these entries, the legislative power of the Union to provide for the regular police force of one State to exercise power and jurisdiction in any area outside the State can

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only be exercised with the consent of the Government of that particular State in which such area is situated, except the police force belonging to any State to exercise power and jurisdiction to railway areas outside that State.

19. As the preamble of the Special Police Act states, it was enacted with a view to constitute a special force in Delhi for the investigation of certain offences in the Union Territories and to make provisions for the superintendence and administration of the said force and for the extension to other areas of the powers and jurisdiction of the members of the said force in regard to the investigation of the said offences. Sub-section (1) of Section 1 specifies the title of the Special Police Act and Sub-section (2) speaks that the Special Police Act extends to the whole of India. Section 2 contains 3 Sub-sections. Sub-section (1) empowers the Central Government to constitute a special police force to be called the Delhi Special Police Establishment for the investigation of offences notified under Section 3 in any Union Territory; Sub-section (2) confers upon the members of the said police establishment in relation to the investigation of such offences and arrest of persons concerned in such offences, all the powers, duties, privileges and liabilities which police officers of that Union Territory have in connection with the investigation of offences committed therein and Sub-section (3) provides that any member of the said police establishment of or above the rank of Sub-Inspector be deemed to be an officer in charge of a police station. Under Section 3 of the Special Police Act, the Central Government is required to specify and notify the offences or classes of offences which are to be investigated by the Delhi Special Police Establishment, constituted under the Special Police Act, named "the CBI". Section 4 deals with the administrative control of the establishment and according to Sub-section (2), the "superintendence" of the Establishment vests in the Central Government and the administration of the said establishment vests in an officer appointed in this behalf by the Central Government. Explaining the meaning of the word "Superintendence" in Section 4(1) and the scope of the authority of the Central Government in this context, in Vineet Narain and Ors. v. Union of India and Anr. : (1998) 1 SCC 226, a Bench of three Judges of this Court said:

40. ...The word "superintendence" in Section 4(1) cannot be construed in a wider sense to permit supervision of the actual investigation of an offence by the CBI contrary to the manner provided by the statutory provisions. The broad proposition urged on behalf of the Union of India that it can issue any directive to the CBI to curtail or inhibit its jurisdiction to investigate an offence specified in the notification issued under Section 3 by a directive under Section 4(1) of the Act cannot be accepted. The jurisdiction of the CBI to investigate an offence is to be determined with reference to the notification issued under Section 3 and not by any separate order not having that character.

20. Section 5 of the Special Police Act empowers the Central Government to extend the powers and jurisdiction of the Special Police Establishment to any area, in a State, not being a Union Territory for the investigation of any offences or classes of offences specified in a notification under Section 3 and on such extension of jurisdiction, a member of the Establishment shall discharge the functions of a police officer in that area and shall, while so discharging such functions, be deemed to be a member of the police

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force of that area and be vested with the powers, functions and privileges and be subject to the liabilities of a police officer belonging to that police force.

21. Section 6, the pivotal provision, reads as follows:

6. Consent of State Government to exercise of powers and jurisdiction. - Nothing contained in Section 5 shall be deemed to enable any member of the Delhi Special Police Establishment to exercise powers and jurisdiction in any area in a State, not being a Union Territory or railway area, without the consent of the Government of that State.

22. Thus, although Section 5(1) empowers the Central Government to extend the powers and jurisdiction of members of the Delhi Special Police Establishment to any area in a State, but Section 6 imposes a restriction on the power of the Central Government to extend the jurisdiction of the said Establishment only with the consent of the State Government concerned.

23. Having noticed the scope and amplitude of Sections 5 and 6 of the Special Police Act, the question for consideration is whether the restriction imposed on the powers of the Central Government would apply mutatis mutandis to the Constitutional Courts as well. As stated above, the main thrust of the argument of Shri K.K. Venugopal, learned senior counsel, is that the course adopted by the High Court in directing the CBI to undertake investigation in the State of West Bengal without the consent of the State is incompatible with the federal structure as also the doctrine of separation of powers between the three organs of the State, embodied in the Constitution even when the High Court, on the material before it, was convinced that the State Police was dragging its feet in so far as investigation into the 4th January, 2001 carnage was concerned.

24. In so far as the first limb of the argument is concerned, it needs little emphasis that, except in the circumstances indicated above, in a federal structure, the Union is not permitted to encroach upon the legislative powers of a State in respect of the matters specified in List II of the Seventh Schedule. However, the second limb of the argument of the learned Counsel in regard to the applicability of the doctrine of separation of powers to the issue at hand, in our view, is clearly untenable. Apart from the fact that the question of Centre - State relationship is not an issue in the present case, a Constitutional Court being itself the custodian of the federal structure, the invocation of the federal structure doctrine is also misplaced.

25. In a democratic country governed by a written Constitution, it is the Constitution which is supreme and sovereign. As observed in Raja Ram Pal v. Hon'ble Speaker, Lok Sabha and Ors. : (2007) 3 SCC 184, the Constitution is the suprema lex in this country. All organs of the State, including this Court and the High Courts, derive their authority, jurisdiction and powers from the Constitution and owe allegiance to it. Highlighting the fundamental features of a federal Constitution, in Special Reference No. 1 (supra), the Constitution Bench (7-Judges) observed as follows:

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...the essential characteristic of federalism is `the distribution of limited executive, legislative and judicial authority among bodies which are coordinate with and independent of each other'. The supremacy of the Constitution is fundamental to the existence of a federal State in order to prevent either the legislature of the federal unit or those of the member States from destroying or impairing that delicate balance of power which satisfies the particular requirements of States which are desirous of union, but not prepared to merge their individuality in a unity. This supremacy of the Constitution is protected by the authority of an independent judicial body to act as the interpreter of a scheme of distribution of powers.

26. It is trite that in the Constitutional Scheme adopted in India, besides supremacy of the Constitution, the separation of powers between the legislature, the executive and the judiciary constitutes the basic features of the Constitution. In fact, the importance of separation of powers in our system of governance was recognised in Special Reference No. 1 (supra), even before the basic structure doctrine came to be propounded in the celebrated case of His Holiness Kesavananda Bharati Sripadagalvaru v. State of Kerala and Anr. : (1973) 4 SCC 225, wherein while finding certain basic features of the Constitution, it was opined that separation of powers is part of the basic structure of the Constitution. Later, similar view was echoed in Smt. Indira Nehru Gandhi v. Shri Raj Narain and Anr. : 1975 (Supp) SCC 1 and in a series of other cases on the point. Nevertheless, apart from the fact that our Constitution does not envisage a rigid and strict separation of powers between the said three organs of the State, the power of judicial review stands entirely on a different pedestal. Being itself part of the basic structure of the Constitution, it cannot be ousted or abridged by even a Constitutional amendment. [See: L. Chandra Kumar v. Union of India and Ors. (supra)]. Besides, judicial review is otherwise essential for resolving the disputes regarding the limits of Constitutional power and entering the Constitutional limitations as an ultimate interpreter of the Constitution. In Special Reference No. 1 of 1964 (supra), it was observed that whether or not there is distinct and rigid separation of powers under the Indian Constitution, there is no doubt that the Constitution has entrusted to the judicature in this country the task of construing the provisions of the Constitution and of safeguarding the fundamental rights of the citizens. In Smt. Indira Nehru Gandhi (supra), Y.V. Chandrachud, J. (as His Lordship then was), drawing distinction between the American and Australian Constitution on the one hand and the Indian Constitution on the other, observed that the principle of separation of powers is not a magic formula for keeping the three organs of the State within the strict confines of their functions. The learned judge also observed that in a federal system, which distributes powers between three coordinate branches of government, though not rigidly, disputes regarding the limits of Constitutional power have to be resolved by courts. Quoting George Whitecross Paton, an Australian Legal Scholar, that "the distinction between judicial and other powers may be vital to the maintenance of the Constitution itself", the learned judge said that the principle of separation of powers is a principle of restraint which "has in it the percept, innate in the prudence of self-preservation (even if history has not repeatedly brought in home), that discretion is the better part of valour" Julius Stone: Social Dimensions of Law and Justice, (1966) p. 668.

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27. Recently in State of U.P. and Ors. v. Jeet S. Bisht and Anr. MANU/SC/7702/2007 : (2007) 6 SCC 586, S.B. Sinha, J. dealt with the topic of separation of powers in the following terms:

77. Separation of powers is a favourite topic for some of us. Each organ of the State in terms of the constitutional scheme performs one or the other functions which have been assigned to the other organ. Although drafting of legislation and its implementation by and large are functions of the legislature and the executive respectively, it is too late in the day to say that the constitutional court's role in that behalf is non-existent. The judge-made law is now well recognised throughout the world. If one is to put the doctrine of separation of power to such a rigidity, it would not have been possible for any superior court of any country, whether developed or developing, to create new rights through interpretative process.

78. Separation of powers in one sense is a limit on active jurisdiction of each organ. But it has another deeper and more relevant purpose: to act as check and balance over the activities of other organs. Thereby the active jurisdiction of the organ is not challenged; nevertheless there are methods of prodding to communicate the institution of its excesses and shortfall in duty. Constitutional mandate sets the dynamics of this communication between the organs of polity. Therefore, it is suggested to not understand separation of powers as operating in vacuum. Separation of powers doctrine has been reinvented in modern times.

80. The modern view, which is today gathering momentum in constitutional courts the world over, is not only to demarcate the realm of functioning in a negative sense, but also to define the minimum content of the demarcated realm of functioning. Objective definition of function and role entails executing the same, which however may be subject to the plea of financial constraint but only in exceptional cases. In event of any such shortcoming, it is the essential duty of the other organ to advise and recommend the needful to substitute inaction. To this extent we must be prepared to frame answers to these difficult questions.

83. If we notice the evolution of separation of powers doctrine, traditionally the checks and balances dimension was only associated with governmental excesses and violations. But in today's world of positive rights and justifiable social and economic entitlements, hybrid administrative bodies, private functionaries discharging public functions, we have to perform the oversight function with more urgency and enlarge the field of checks and balances to include governmental inaction. Otherwise we envisage the country getting transformed into a state of repose. Social engineering as well as institutional engineering therefore forms part of this obligation.

28. Having discussed the scope and width of the doctrine of separation of powers, the moot question for consideration in the present case is that when the fundamental rights, as enshrined in Part III of the Constitution, which include the right to equality (Article 14); the freedom of speech [Article 19(1)(a)] and the right not to be deprived of life and liberty except by procedure established by law (Article 21), as alleged in the instant case,

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are violated, can their violation be immunised from judicial scrutiny on the touchstone of doctrine of separation of powers between the Legislature, Executive and the Judiciary. To put it differently, can the doctrine of separation of powers curtail the power of judicial review, conferred on the Constitutional Courts even in situations where the fundamental rights are sought to be abrogated or abridged on the ground that exercise of such power would impinge upon the said doctrine?

29. The Constitution is a living and organic document. It cannot remain static and must grow with the nation. The Constitutional provisions have to be construed broadly and liberally having regard to the changed circumstances and the needs of time and polity. In Kehar Singh and Anr. v. Union of India and Anr. : (1989) 1 SCC 204, speaking for the Constitution Bench, R.S. Pathak, C.J. held that in keeping with modern Constitutional practice, the Constitution of India is a constitutive document, fundamental to the governance of the country, whereby the people of India have provided a Constitutional polity consisting of certain primary organs, institutions and functionaries with the intention of working out, maintaining and operating a Constitutional order. On the aspect of interpretation of a Constitution, the following observations of Justice Dickson of the Supreme Court of Canada in Lawson A.W. Hunter and Ors. v. Southam Inc. (1984) 2 S.C.R. 145 (Can SC) are quite apposite:

The task of expounding a constitution is crucially different from that of construing a statute. A statute defines present rights and obligations. It is easily enacted and as easily repealed. A constitution, by contrast, is drafted with an eye to the future. Its function is to provide a continuing framework for the legitimate exercise of governmental power and, when joined by a Bill or a Charter of rights, for the unremitting protection of individual rights and liberties. Once enacted, its provisions cannot easily be repealed or amended. It must, therefore, be capable of growth and development over time to meet new social, political and historical realities often unimagined by its framers. The judiciary is the guardian of the constitution and must, in interpreting its provisions, bear these considerations in mind.

30. In M. Nagaraj and Ors. v. Union of India and Ors. : (2006) 8 SCC 212, speaking for the Constitution Bench, S.H. Kapadia, J. observed as under:

The Constitution is not an ephemeral legal document embodying a set of legal rules for the passing hour. It sets out principles for an expanding future and is intended to endure for ages to come and consequently to be adapted to the various crisis of human affairs. Therefore, a purposive rather than a strict literal approach to the interpretation should be adopted. A Constitutional provision must be construed not in a narrow and constricted sense but in a wide and liberal manner so as to anticipate and take account of changing conditions and purposes so that a constitutional provision does not get fossilised but remains flexible enough to meet the newly emerging problems and challenges.

31. Recently, in I.R. Coelho (supra), noticing the principles relevant for the interpretation of Constitutional provisions, Y.K. Sabharwal, C.J., speaking for the Bench of nine Judges of this Court, observed as follows:

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The principle of constitutionalism is now a legal principle which requires control over the exercise of Governmental power to ensure that it does not destroy the democratic principles upon which it is based. These democratic principles include the protection of fundamental rights. The principle of constitutionalism advocates a check and balance model of the separation of powers; it requires a diffusion of powers, necessitating different independent centres of decision making. The principle of constitutionalism underpins the principle of legality which requires the Courts to interpret legislation on the assumption that Parliament would not wish to legislate contrary to fundamental rights. The Legislature can restrict fundamental rights but it is impossible for laws protecting fundamental rights to be impliedly repealed by future statutes.

Observing further that the protection of fundamental constitutional rights through the common law is the main feature of common law constitutionalism, the Court went on to say:

Under the controlled Constitution, the principles of checks and balances have an important role to play. Even in England where Parliament is sovereign, Lord Steyn has observed that in certain circumstances, Courts may be forced to modify the principle of parliamentary sovereignty, for example, in cases where judicial review is sought to be abolished. By this the judiciary is protecting a limited form of constitutionalism, ensuring that their institutional role in the Government is maintained.

32. The Constitution of India expressly confers the power of judicial review on this Court and the High Courts under Article 32 and 226 respectively. Dr. B.R. Ambedkar described Article 32 as the very soul of the Constitution - the very heart of it - the most important Article. By now, it is well settled that the power of judicial review, vested in the Supreme Court and the High Courts under the said Articles of the Constitution, is an integral part and essential feature of the Constitution, constituting part of its basic structure. Therefore, ordinarily, the power of the High Court and this Court to test the Constitutional validity of legislations can never be ousted or even abridged. Moreover, Article 13 of the Constitution not only declares the pre- constitution laws as void to the extent to which they are inconsistent with the fundamental rights, it also prohibits the State from making a law which either takes away totally or abrogates in part a fundamental right. Therefore, judicial review of laws is embedded in the Constitution by virtue of Article 13 read with Articles 32 and 226 of our Constitution. It is manifest from the language of Article 245 of the Constitution that all legislative powers of the Parliament or the State Legislatures are expressly made subject to other provisions of the Constitution, which obviously would include the rights conferred in Part III of the Constitution. Whether there is a contravention of any of the rights so conferred, is to be decided only by the Constitutional Courts, which are empowered not only to declare a law as unconstitutional but also to enforce fundamental rights by issuing directions or orders or writs of or "in the nature of" mandamus, certiorari, habeas corpus, prohibition and quo warranto for this purpose. It is pertinent to note that Article 32 of the Constitution is also contained in Part III of the Constitution, which enumerates the fundamental rights and not alongside other Articles of the Constitution which define the general jurisdiction of the Supreme Court. Thus, being a fundamental right itself, it is the duty of this Court to ensure that no fundamental

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right is contravened or abridged by any statutory or constitutional provision. Moreover, it is also plain from the expression "in the nature of" employed in Clause (2) of Article 32 that the power conferred by the said clause is in the widest terms and is not confined to issuing the high prerogative writs specified in the said clause but includes within its ambit the power to issue any directions or orders or writs which may be appropriate for enforcement of the fundamental rights. Therefore, even when the conditions for issue of any of these writs are not fulfilled, this Court would not be constrained to fold its hands in despair and plead its inability to help the citizen who has come before it for judicial redress. (per P.N. Bhagwati, J. in Bandhua Mukti Morcha v. Union of India and Ors. : (1984) 3 SCC 161).

33. In this context, it would be profitable to make a reference to the decision of this Court in Nilabati Behera (supra). The Court concurred with the view expressed by this Court in Khatri and Ors. (II) v. State of Bihar and Ors. : (1981) 1 SCC 627 and Khatri and Ors. (IV) v. State of Bihar and Ors. : (1981) 2 SCC 493, wherein it was said that the Court is not helpless to grant relief in a case of violation of the right to life and personal liberty, and it should be prepared "to forge new tools and devise new remedies" for the purpose of vindicating these precious fundamental rights. It was also indicated that the procedure suitable in the facts of the case must be adopted for conducting the enquiry, needed to ascertain the necessary facts, for granting the relief, as may be available mode of redress, for enforcement of the guaranteed fundamental rights. In his concurring judgment, Dr. A.S. Anand, J. (as His Lordship then was), observed as under:

35. This Court and the High Courts, being the protectors of the civil liberties of the citizen, have not only the power and jurisdiction but also an obligation to grant relief in exercise of its jurisdiction under Articles 32 and 226 of the Constitution to the victim or the heir of the victim whose fundamental rights under Article 21 of the Constitution of India are established to have been flagrantly infringed by calling upon the State to repair the damage done by its officers to the fundamental rights of the citizen, notwithstanding the right of the citizen to the remedy by way of a civil suit or criminal proceedings. The State, of course has the right to be indemnified by and take such action as may be available to it against the wrongdoer in accordance with law - through appropriate proceedings.

34. It may not be out of place to mention that in so far as this Court is concerned, apart from Articles 32 and 142 which empower this Court to issue such directions, as may be necessary for doing complete justice in any cause or matter, Article 144 of the Constitution also mandates all authorities, civil or judicial in the territory of India, to act in aid of the orders passed by this Court.

35. As regards the power of judicial review conferred on the High Court, undoubtedly they are, in a way, wider in scope. The High Courts are authorised under Article 226 of the Constitution, to issue directions, orders or writs to any person or authority, including any government to enforce fundamental rights and, "for any other purpose". It is manifest from the difference in the phraseology of Articles 32 and 226 of the Constitution that there is a marked difference in the nature and purpose of the right conferred by these two

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Articles. Whereas the right guaranteed by Article 32 can be exercised only for the enforcement of fundamental rights conferred by Part III of the Constitution, the right conferred by Article 226 can be exercised not only for the enforcement of fundamental rights, but "for any other purpose" as well, i.e. for enforcement of any legal right conferred by a Statute etc.

36. In Tirupati Balaji Developers (P) Ltd. and Ors. v. State of Bihar and Ors. : (2004) 5 SCC 1, this Court had observed thus:

8. Under the constitutional scheme as framed for the judiciary, the Supreme Court and the High Courts both are courts of record. The High Court is not a court "subordinate" to the Supreme Court. In a way the canvas of judicial powers vesting in the High Court is wider inasmuch as it has jurisdiction to issue all prerogative writs conferred by Article 226 of the Constitution for the enforcement of any of the rights conferred by Part III of the Constitution and for any other purpose while the original jurisdiction of Supreme Court to issue prerogative writs remains confined to the enforcement of fundamental rights and to deal with some such matters, such as Presidential elections or inter-State disputes which the Constitution does not envisage being heard and determined by High Courts.

37. In Dwarkanath's case (supra), this Court had said that Article 226 of the Constitution is couched in comprehensive phraseology and it ex facie confers a wide power on the High Court to reach injustice wherever it is found. This Article enables the High Courts to mould the reliefs to meet the peculiar and extra-ordinary circumstances of the case. Therefore, what we have said above in regard to the exercise of jurisdiction by this Court under Article 32, must apply equally in relation to the exercise of jurisdiction by the High Courts under Article 226 of the Constitution.

38. Article 21, one of the fundamental rights enshrined in Part III of the Constitution declares that no person shall be deprived of his "life" or "personal liberty" except according to the procedure established by law. It is trite that the words "life" and "personal liberty" are used in the Article as compendious terms to include within themselves all the varieties of life which go to make up the personal liberties of a man and not merely the right to the continuance of person's animal existence. (See: Kharak Singh v. State of U.P. : (1964) 1 SCR 332)

39. The paramountcy of the right to "life" and "personal liberty" was highlighted by the Constitution Bench in Kehar Singh (supra). It was observed thus:

To any civilised society, there can be no attributes more important than the life and personal liberty of its members. That is evident from the paramount position given by the courts to Article 21 of the Constitution. These twin attributes enjoy a fundamental ascendancy over all other attributes of the political and social order, and consequently, the Legislature, the Executive and the Judiciary are more sensitive to them than to the other attributes of daily existence. The deprivation of personal liberty and the threat of the deprivation of life by the action of the State is in most civilised societies regarded

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seriously and, recourse, either under express constitutional provision or through legislative enactment is provided to the judicial organ.

40. In Minerva Mills (supra), Y.V. Chandrachud, C.J., speaking for the majority observed that Articles 14 and 19 do not confer any fanciful rights. They confer rights which are elementary for the proper and effective functioning of democracy. They are universally regarded by the Universal Declaration of Human Rights. If Articles 14 and 19 are put out of operation, Article 32 will be drained of its life blood. Emphasising the significance of Articles 14, 19 and 21, the learned Chief Justice remarked:

74. Three Articles of our Constitution, and only three, stand between the heaven of freedom into which Tagore wanted his country to awake and the abyss of unrestrained power. They are Articles 14, 19 and 21. Article 31C has removed two sides of that golden triangle which affords to the people of this country an assurance that the promise held forth by the preamble will be performed by ushering an egalitarian era through the discipline of fundamental rights, that is, without emasculation of the rights to liberty and equality which alone can help preserve the dignity of the individual.

41. The approach in the interpretation of fundamental rights has again been highlighted in M. Nagaraj (supra), wherein this Court observed as under:

This principle of interpretation is particularly apposite to the interpretation of fundamental rights. It is a fallacy to regard fundamental rights as a gift from the State to its citizens. Individuals possess basic human rights independently of any constitution by reason of basic fact that they are members of the human race. These fundamental rights are important as they possess intrinsic value. Part- III of the Constitution does not confer fundamental rights. It confirms their existence and gives them protection. Its purpose is to withdraw certain subjects from the area of political controversy to place them beyond the reach of majorities and officials and to establish them as legal principles to be applied by the courts. Every right has a content. Every foundational value is put in Part-III as a fundamental right as it has intrinsic value. The converse does not apply. A right becomes a fundamental right because it has foundational value. Apart from the principles, one has also to see the structure of the Article in which the fundamental value is incorporated. Fundamental right is a limitation on the power of the State. A Constitution, and in particular that of it which protects and which entrenches fundamental rights and freedoms to which all persons in the State are to be entitled is to be given a generous and purposive construction. In Sakal Papers (P) Ltd. v. Union of India : AIR 1962 SC 305, this Court has held that while considering the nature and content of fundamental rights, the Court must not be too astute to interpret the language in a literal sense so as to whittle them down. The Court must interpret the Constitution in a manner which would enable the citizens to enjoy the rights guaranteed by it in the fullest measure. An instance of literal and narrow interpretation of a vital fundamental right in the Indian Constitution is the early decision of the Supreme Court in A.K. Gopalan v. State of Madras : AIR 1950 SC 27. Article 21 of the Constitution provides that no person shall be deprived of his life and personal liberty except according to procedure established by law. The Supreme Court by a majority held that 'procedure established by

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law' means any procedure established by law made by the Parliament or the legislatures of the State. The Supreme Court refused to infuse the procedure with principles of natural justice. It concentrated solely upon the existence of enacted law. After three decades, the Supreme Court overruled its previous decision in A.K. Gopalan and held in its landmark judgment in Maneka Gandhi v. Union of India : (1978) 1 SCC 248 that the procedure contemplated by Article 21 must answer the test of reasonableness. The Court further held that the procedure should also be in conformity with the principles of natural justice. This example is given to demonstrate an instance of expansive interpretation of a fundamental right. The expression 'life' in Article 21 does not connote merely physical or animal existence. The right to life includes right to live with human dignity. This Court has in numerous cases deduced fundamental features which are not specifically mentioned in Part-III on the principle that certain unarticulated rights are implicit in the enumerated guarantees.

42. Thus, the opinion of this Court in A.K. Gopalan (supra) to the effect that a person could be deprived of his liberty by `any' procedure established by law and it was not for the Court to go into the fairness of that procedure was perceived in Maneka Gandhi (supra) as a serious curtailment of liberty of an individual and it was held that the law which restricted an individual's freedom must also be right, just and fair and not arbitrary, fanciful or oppressive. This judgment was a significant step towards the development of law with respect to Article 21 of the Constitution, followed in a series of subsequent decisions. This Court went on to explore the true meaning of the word "Life" in Article 21 and finally opined that all those aspects of life, which make a person live with human dignity are included within the meaning of the word "Life".

43. Commenting on the scope of judicial review vis-à-vis constitutional sovereignty particularly with reference to Articles 14, 19 and 21 of the Constitution, in I.R. Coelho (supra), this Court said:

There is a difference between Parliamentary and constitutional sovereignty. Our Constitution is framed by a Constituent Assembly which was not Parliament. It is in the exercise of law making power by the Constituent Assembly that we have a controlled Constitution. Articles 14, 19, 21 represent the foundational values which form the basis of the rule of law. These are the principles of constitutionality which form the basis of judicial review apart from the rule of law and separation of powers. If in future, judicial review was to be abolished by a constitutional amendment, as Lord Steyn says, the principle of parliamentary sovereignty even in England would require a relook. This is how law has developed in England over the years. It is in such cases that doctrine of basic structure as propounded in Kesavananda Bharati case (supra) has to apply.

While observing that the abrogation or abridgement of the fundamental rights under Chapter III of the Constitution have to be examined on broad interpretation so as to enable the citizens to enjoy the rights guaranteed by Part III in the fullest measure, the Court explained the doctrine of separation of powers as follows: (SCC p.86- 87, paras 64-66)

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...[i]t was settled centuries ago that for preservation of liberty and prevention of tyranny it is absolutely essential to vest separate powers in three different organs. In The Federalist Nos. 47, 48, and 51, James Madison details how a separation of powers preserves liberty and prevents tyranny. In The Federalist No. 47, Madison discusses Montesquieu's treatment of the separation of powers in Spirit of Laws, (Book XI, Chapter 6). There Montesquieu writes,

When the legislative and executive powers are united in the same person, or in the same body of Magistrates, there can be no liberty... Again, there is no liberty, if the judicial power be not separated from the legislative and executive.

Madison points out that Montesquieu did not feel that different branches could not have overlapping functions, but rather that the power of one department of Government should not be entirely in the hands of another department of Government.

Alexander Hamilton in The Federalist No. 78, remarks on the importance of the independence of the judiciary to preserve the separation of powers and the rights of the people:

The complete independence of the courts of justice is peculiarly essential in a limited Constitution. By a limited Constitution, I understand one which contains certain specified exceptions to the legislative authority; such, for instance, that it shall pass no bills of attainder, no ex post facto laws, and the like. Limitations of this kind can be preserved in practice in no other way than through the medium of courts of justice, whose duty it must be to declare all acts contrary to the manifest tenor of the Constitution void. Without this, all the reservations of particular rights or privileges would amount to nothing.

Montesquieu finds that tyranny pervades when there is no separation of powers:

There would be an end of everything, were the same man or same body, whether of the nobles or of the people, to exercise those three powers, that of enacting laws, that of executing the public resolutions, and of trying the causes of individuals.

The Court further observed: (SCC pg. 105, paras 129-130)

Equality, rule of law, judicial review and separation of powers form parts of the basic structure of the Constitution. Each of these concepts are intimately connected. There can be no rule of law, if there is no equality before the law. These would be meaningless if the violation was not subject to the judicial review. All these would be redundant if the legislative, executive and judicial powers are vested in one organ. Therefore, the duty to decide whether the limits have been transgressed has been placed on the judiciary.

Realising that it is necessary to secure the enforcement of the Fundamental Rights, power for such enforcement has been vested by the Constitution in the Supreme Court and the High Courts. Judicial Review is an essential feature of the Constitution. It gives practical content to the objectives of the Constitution embodied in Part III and other parts of the

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Constitution. It may be noted that the mere fact that equality which is a part of the basic structure can be excluded for a limited purpose, to protect certain kinds of laws, does not prevent it from being part of the basic structure. Therefore, it follows that in considering whether any particular feature of the Constitution is part of the basic structure - rule of law, separation of power - the fact that limited exceptions are made for limited purposes, to protect certain kind of laws, does not mean that it is not part of the basic structure.

Conclusions:

44. Thus, having examined the rival contentions in the context of the Constitutional Scheme, we conclude as follows:

(i) The fundamental rights, enshrined in Part III of the Constitution, are inherent and cannot be extinguished by any Constitutional or Statutory provision. Any law that abrogates or abridges such rights would be violative of the basic structure doctrine. The actual effect and impact of the law on the rights guaranteed under Part III has to be taken into account in determining whether or not it destroys the basic structure.

(ii) Article 21 of the Constitution in its broad perspective seeks to protect the persons of their lives and personal liberties except according to the procedure established by law. The said Article in its broad application not only takes within its fold enforcement of the rights of an accused but also the rights of the victim. The State has a duty to enforce the human rights of a citizen providing for fair and impartial investigation against any person accused of commission of a cognizable offence, which may include its own officers. In certain situations even a witness to the crime may seek for and shall be granted protection by the State.

(iii) In view of the constitutional scheme and the jurisdiction conferred on this Court under Article 32 and on the High Courts under Article 226 of the Constitution the power of judicial review being an integral part of the basic structure of the Constitution, no Act of Parliament can exclude or curtail the powers of the Constitutional Courts with regard to the enforcement of fundamental rights. As a matter of fact, such a power is essential to give practicable content to the objectives of the Constitution embodied in Part III and other parts of the Constitution. Moreover, in a federal constitution, the distribution of legislative powers between the Parliament and the State Legislature involves limitation on legislative powers and, therefore, this requires an authority other than the Parliament to ascertain whether such limitations are transgressed. Judicial review acts as the final arbiter not only to give effect to the distribution of legislative powers between the Parliament and the State Legislatures, it is also necessary to show any transgression by each entity. Therefore, to borrow the words of Lord Steyn, judicial review is justified by combination of "the principles of separation of powers, rule of law, the principle of constitutionality and the reach of judicial review".

(iv) If the federal structure is violated by any legislative action, the Constitution takes care to protect the federal structure by ensuring that Courts act as guardians and interpreters of the Constitution and provide remedy under Articles 32 and 226, whenever

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there is an attempted violation. In the circumstances, any direction by the Supreme Court or the High Court in exercise of power under Article 32 or 226 to uphold the Constitution and maintain the rule of law cannot be termed as violating the federal structure.

(v) Restriction on the Parliament by the Constitution and restriction on the Executive by the Parliament under an enactment, do not amount to restriction on the power of the Judiciary under Article 32 and 226 of the Constitution.

(vi) If in terms of Entry 2 of List II of The Seventh Schedule on the one hand and Entry 2A and Entry 80 of List I on the other, an investigation by another agency is permissible subject to grant of consent by the State concerned, there is no reason as to why, in an exceptional situation, court would be precluded from exercising the same power which the Union could exercise in terms of the provisions of the Statute. In our opinion, exercise of such power by the constitutional courts would not violate the doctrine of separation of powers. In fact, if in such a situation the court fails to grant relief, it would be failing in its constitutional duty.

(vii) When the Special Police Act itself provides that subject to the consent by the State, the CBI can take up investigation in relation to the crime which was otherwise within the jurisdiction of the State Police, the court can also exercise its constitutional power of judicial review and direct the CBI to take up the investigation within the jurisdiction of the State. The power of the High Court under Article 226 of the Constitution cannot be taken away, curtailed or diluted by Section 6 of the Special Police Act. Irrespective of there being any statutory provision acting as a restriction on the powers of the Courts, the restriction imposed by Section 6 of the Special Police Act on the powers of the Union, cannot be read as restriction on the powers of the Constitutional Courts. Therefore, exercise of power of judicial review by the High Court, in our opinion, would not amount to infringement of either the doctrine of separation of power or the federal structure.

45. In the final analysis, our answer to the question referred is that a direction by the High Court, in exercise of its jurisdiction under Article 226 of the Constitution, to the CBI to investigate a cognizable offence alleged to have been committed within the territory of a State without the consent of that State will neither impinge upon the federal structure of the Constitution nor violate the doctrine of separation of power and shall be valid in law. Being the protectors of civil liberties of the citizens, this Court and the High Courts have not only the power and jurisdiction but also an obligation to protect the fundamental rights, guaranteed by Part III in general and under Article 21 of the Constitution in particular, zealously and vigilantly.

46. Before parting with the case, we deem it necessary to emphasise that despite wide powers conferred by Articles 32 and 226 of the Constitution, while passing any order, the Courts must bear in mind certain self-imposed limitations on the exercise of these Constitutional powers. The very plenitude of the power under the said Articles requires great caution in its exercise. In so far as the question of issuing a direction to the CBI to conduct investigation in a case is concerned, although no inflexible guidelines can be laid down to decide whether or not such power should be exercised but time and again it has

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been reiterated that such an order is not to be passed as a matter of routine or merely because a party has levelled some allegations against the local police. This extra-ordinary power must be exercised sparingly, cautiously and in exceptional situations where it becomes necessary to provide credibility and instil confidence in investigations or where the incident may have national and international ramifications or where such an order may be necessary for doing complete justice and enforcing the fundamental rights. Otherwise the CBI would be flooded with a large number of cases and with limited resources, may find it difficult to properly investigate even serious cases and in the process lose its credibility and purpose with unsatisfactory investigations.

47. In Secretary, Minor Irrigation & Rural Engineering Services, U.P. and Ors. v. Sahngoo Ram Arya and Anr. (2002) 5 SCC 521, this Court had said that an order directing an enquiry by the CBI should be passed only when the High Court, after considering the material on record, comes to a conclusion that such material does disclose a prima facie case calling for an investigation by the CBI or any other similar agency. We respectfully concur with these observations.

48. All the cases shall now be placed before the respective Benches for disposal in terms of this opinion.

Ratio Decidendi:

“The doctrine of separation of powers cannot curtail the power of judicial review conferred on the constitutional Courts specially in situations where the fundamental rights are sought to be abrogated or abridged under the garb of these doctrines.”

“Violation of Fundamental Rights cannot be immunised from judicial scrutiny under Article 226 or under Article 32 on the touchstone of doctrine of separation of powers between the Legislature, Executive and the Judiciary.”

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1

Uttar Pradesh State Road Transport Corporation and another v. Suresh Chand Sharma and another2

Both these appeals have been preferred against the impugned judgment and order of the High Court of Uttaranchal at Nainital in Writ Petition No. 4143 of 2001 by which the Writ Petition filed by the Respondent-employee of the U.P. State Road Transport Corporation (hereinafter referred to as the 'Corporation') has been allowed directing his re-instatement in service, but without back wages. The Corporation has filed appeal being aggrieved of the order of re- instatement and reversal of the Award of the Labour Court dated 28.4.1995, while Civil Appeal No.3088 of 2007 has been preferred by the employee Shri Suresh Chand Sharma claiming full back wages.

2. Facts and circumstances giving rise to these appeals are that the said employee while working as a Conductor on bus No.UTL-9194 on the route Haridwar-Rishikesh was found, on checking on 24.5.1987, carrying 13 passengers without ticket from whom he has already recovered the fare and on 10.5.1988 on bus No.UGA-9059 on which he was working as a Conductor, 10 passengers were found without ticket. However, the employee had already recovered the fare from them. The Corporation served charge sheets upon the employee on 16.5.1988 and 7.7.1988 in respect of the mis- conducts dated 10.5.1988 and 24.5.1987. Employee submitted his reply to the charge sheets. However, the management not being satisfied with his reply decided to proceed with the regular enquiry and one Shri H.L. Saxena, a retired I.F.S. Officer was appointed as Enquiry Officer. The enquiry was conducted on both the charges giving full opportunity of hearing/defence to the employee. Enquiry Officer submitted the enquiry report wherein charges in respect of both the misconducts had been found proved. The Disciplinary Authority accorded its concurrence thereto. The management served the copy of the enquiry report and issued a second show cause dated 14.12.1988 to the employee to which he submitted his reply on 9.1.1999. The Disciplinary Authority was not satisfied with his reply and after considering the material on record, the Authority passed the punishment order dated 29.1.1989 dismissing the employee from service.

3. Being aggrieved, the Employee preferred a Departmental Appeal which was duly considered by the Appellate Authority and rejected vide order dated 21.3.1990. The Employee raised an industrial dispute and thus, the matter was referred by the Appropriate Government to the Labour Court vide reference dated 19.12.1991 to the following effect:"Whether the termination of the services of the applicant/workman Shri S.C. Sharma s/o Late Shri Om Prakash, conductor by the employer from 29.1.1989 is unjustified and/or illegal? If so, which benefit/compensation the applicant/workman is entitled and to what extent?

2 Supreme Court of India 26 May 2010 Civil Appeal No. 3086 of 2007 with Civil Appeal No. 3088 of 2007 The Judgment was delivered by : Hon'ble Justice B. S. Chauhan

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4. Both the parties appeared before the Labour Court, filed their replies and affidavits. Both parties filed documentary evidence and also led oral evidence and advanced submissions in support of their respective cases. The Labour Court considered all aspects and vide Award dated 28.4.1995 held that enquiry had been held strictly in accordance with law and both the charges in respect of both the incidents were found duly proved. Therefore, the employee was not entitled to any relief whatsoever.

5. Being aggrieved, the employee challenged the Award by filing C.M.W.P. No.9129 of 1996 before the High Court of Judicature at Allahabad which was transferred to the High Court at Nainital after Re-organisation of States and the said transferred case was registered as Writ Petition No. 4143 (M/S) of 2001. The High Court allowed the Writ Petition partly vide impugned judgment and order dated 7.9.2005 and directed the re-instatement of the employee without back wages. Hence, these appeals.

6. We have heard Shri Suraj Singh, learned counsel appearing for the Corporation and Dr. J.N. Dubey, learned senior counsel appearing for the employee. Large number of submissions have been made by the parties and it has been contended on behalf of the Corporation that the High Court has not recorded any reason whatsoever while setting aside the Award of the Labour Court. No fault could be found with the Award of the Labour Court and it was not necessary for the checking authority to record the evidence of the passengers who were found travelling without tickets nor it was necessary to check the cash at the hand of the employee. The High Court mis-directed itself while setting aside the well- reasoned Award of the Labour Court without giving any reason whatsoever. Thus, the appeal of the Corporation deserves to be allowed and Award of the Labour Court deserved to be restored.

7. Per contra, Dr. J.N. Dubey, learned counsel appearing for the employee has submitted that the High Court was justified in accepting the submissions on behalf of the employee that material witnesses were not examined. Thus, no disciplinary proceeding could be initiated against the employee. There was no justification for imposing the punishment of dismissal by the authority and once the Award of the Labour Court is set aside, the employee was entitled to full back wages. Thus, the Corporation's appeal is liable to the dismissed and appeal filed by the employee deserves to be allowed.

8. We have considered the rival submissions made by learned counsel for the parties and perused the record.

9. The Labour Court has considered the matter at length and came to the conclusion that enquiry had been conducted strictly in accordance with law. There has been no violation of the principles of natural justice or any other statutory provision. The employee was given full opportunity to defend himself, cross examined the witnesses examined by the Corporation. The Enquiry Officer has rightly appreciated the evidence and found the charges proved in respect of both the incidents. The Disciplinary Authority has taken a right decision accepting the enquiry report and punishment order was passed after serving second show cause to the employee. The Labour Court recorded the findings on facts as under:

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"As far as the question of conclusions drawn by the Enquiry officer is concerned, in the enquiry conducted in respect of first charge sheet dated 7.7.1988 Ext.E/2, statement of Shri Atar Singh, Traffic Inspector has been recorded wherein he has proved the report Ext.E/1 of Shri Atar Singh, Traffic Inspector. Shri Atar Singh had checked the vehicle and 13 without ticket passengers have been found travelling from whom the petitioner-workman had already taken Rs..43/- as fare. Shri Atar Singh has accordingly made a remark on the way bill and obtained the signatures of petitioner-workman also. The petitioner-workman did not ask any question in cross-examination to this witness. The petitioner workman has also not asked any question in cross- examination with the other witness Shri Kailash Chandra, Traffic Inspector." (Emphasis added)

10. The Labour Court recorded a finding of fact that in respect of both the mis-conducts the passengers were found travelling without tickets and they had already paid fare to the employee/Conductor. Thus, it is not a case where the said employee could not issue the ticket and recover the fare from the travelling passengers, rather the finding has been recorded that after recovering the fare from the passengers, he did not issue tickets to them. Thus, there was an intention to mis-appropriate the fare recovered from the passengers who were found travelling without tickets at both the times.

11. The High Court dealt with the matter in a most cryptic manner. Relevant/main part of the judgment of the High Court reads as under:"5.....The Inspector in the cross-examination has also stated on oath that the cash was not checked. The learned counsel for the petitioner further submitted that when the bus was checked, ten passengers were boarded on the bus and they were drunk and they were also denying taking the tickets. The learned Tribunal has not considered this fact at all. I find force in the contention of the learned counsel for the petitioner. The learned Tribunal ought to have considered this fact that neither the passengers were examined, nor the cash was checked. Therefore, the order of the learned Tribunal cannot be sustained in the eye of law." (Emphasis added)

12. The High Court has decided the Writ Petition only on the ground that the passengers found without tickets, had not been examined and the cash with the employee was checked. No other reasoning has been given whatsoever by the Court.

13. In State of Haryana & Anr. Vs. Rattan Singh AIR 1977 SC 1512 1977 Indlaw SC 2, this Court has categorically held that in a domestic enquiry, complicated principles and procedure laid down in the Code of Civil Procedure, 1908 and the Indian Evidence Act, 1872 do not apply. The only right of a delinquent employee is that he must be informed as to what are the charges against him and he must be given full opportunity to defend himself on the said charges. However, the Court rejected the contention that enquiry report stood vitiated for not recording the statement of the passengers who were found travelling without ticket. The Court held as under:"We cannot hold that merely because statements of passengers were not recorded the order that followed was invalid. Likewise, the re- evaluation of the evidence on the

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strength of co- conductor's testimony is a matter not for the court but for the administrative tribunal. In conclusion, we do not think courts below were right in over-turning the finding of the domestic tribunal."

14. In view of the above, the reasoning so given by the High Court cannot be sustained in the eye of law. More so, the High Court is under an obligation to give not only the reasons but cogent reasons while reversing the findings of fact recorded by a domestic tribunal. In case the judgment and order of the High Court is found not duly supported by reasons, the judgment itself stands vitiated. (Vide State of Maharashtra Vs. Vithal Rao Pritirao Chawan, AIR 1982 SC 1215 1981 Indlaw SC 76; State of U.P. Vs. Battan & Ors. (2001) 10 SCC 607 2000 Indlaw SC 3698); Raj Kishore Jha Vs. State of Bihar & Ors. AIR 2003 SC 4664 2003 Indlaw SC 819; and State of Orissa Vs. Dhaniram Luhar AIR 2004 SC 1794 2004 Indlaw SC 94.

15. In State of West Bengal Vs. Atul Krishna Shaw & Anr. AIR 1990 SC 2205 1990 Indlaw SC 405, this Court observed that "giving of reasons is an essential element of administration of justice. A right to reason is, therefore, an indispensable part of sound system of judicial review."

16. In State of Uttaranchal & Anr. Vs. Sunil Kumar Singh Negi AIR 2008 SC 2026 2008 Indlaw SC 432, this Court held as under:

"Right to reason is an indispensable part of a sound judicial system; reasons at least sufficient to indicate an application of mind to the matter before Court. Another rationale is that the affected party can know why the decision has gone against him. One of the salutary requirements of natural justice is spelling out reasons for the order made".

17. In Raj Kishore Jha 2003 Indlaw SC 819 (supra), this Court observed as under:"Before we part with the case, we feel it necessary to indicate that non-reasoned conclusions by appellate Courts are not appropriate, more so, when views of the lower Court are differed from. In case of concurrence, the need to again repeat reasons may not be there. It is not so in case of reversal. Reason is the heartbeat of every conclusion. Without the same, it becomes lifeless".

18. In fact, "reasons are the links between the material, the foundation for these erection and the actual conclusions. They would also administer how the mind of the maker was activated and actuated and their rational nexus and synthesis with the facts considered and the conclusion reached". (vide: Krishna Swami Vs. Union of India & Ors. AIR 1993 SC 1407 1992 Indlaw SC 1258)

19. Therefore, the law on the issue can be summarized to the effect that, while deciding the case, court is under an obligation to record reasons, however, brief, the same may be as it is a requirement of principles of natural justice. Non- observance of the said principle would vitiate the judicial order.Thus, in view of the above, the judgment and order of the High Court impugned herein is liable to be set aside.

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20. We do not find any force in the submissions made by Dr. J.N. Dubey, learned Senior counsel for the employee that for embezzlement of such a petty amount, punishment of dismissal could not be justified for the reason that it is not the amount embezzled by a delinquent employee but the mens rea to mis-appropriate the public money.

21. In Municipal Committee, Bahadurgarh Vs. Krishnan Bihari & Ors., AIR 1996 SC 1249 1996 Indlaw SC 3265, this Court held as under:-"In a case of such nature - indeed, in cases involving corruption - there cannot be any other punishment than dismissal. Any sympathy shown in such cases is totally uncalled for and opposed to public interest. The amount misappropriated may be small or large; it is the act of misappropriation that is relevant."

Similar view has been reiterated by this Court in Ruston & Hornsby (I) Ltd. Vs. T.B. Kadam, AIR 1975 SC 2025 1975 Indlaw SC 34; U.P. State Road Transport Corporation Vs. Basudeo Chaudhary & Anr., (1997) 11 SCC 370 1996 Indlaw SC 2633; Janatha Bazar (South Kanara Central Cooperative Wholesale Stores Ltd.) & Ors. Vs. Secretary, Sahakari Noukarara Sangha & Ors., (2000) 7 SCC 517 2000 Indlaw SC 472; Karnataka State Road Transport Corporation Vs. B.S. Hullikatti, AIR 2001 SC 930 2001 Indlaw SC 20334; and Regional Manager, R.S.R.T.C. Vs. Ghanshyam Sharma, (2002) 10 SCC 330 2001 Indlaw SC 20619. In Divisional Controller N.E.K.R.T.C. Vs. H. Amaresh, AIR 2006 SC 2730 2006 Indlaw SC 831; and U.P.S.R.T.C. Vs. Vinod Kumar, (2008) 1 SCC 115 2007 Indlaw SC 1281, this Court held that the punishment should always be proportionate to the gravity of the misconduct. However, in a case of corruption/misappropriation, the only punishment is dismissal.

22. Thus, in view of the above, the contention raised on behalf of the employee that punishment of dismissal from service was disproportionate to the proved delinquency of the employee, is not worth acceptance.

Appeal preferred by the Corporation i.e. Civil Appeal No. 3086 of 2007 is allowed. The judgment and order of the High Court dated 7.9.2005 is hereby set aside and the Award of the Labour Court dated 28.4.1995 is restored. The appeal preferred by the employee i.e. Civil Appeal No.3088 of 2007 is hereby dismissed. No order as to costs.

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Canara Bank v Union of India and others3

1. The petitioner bank in this petition impugns the award dated 19th April, 2004 of the Industrial Tribunal on the following reference:-

“Whether the action of the management of Canara Bank in considering the workman Sri Ram Pal Sharma sub-staff as voluntarily retired from services of the Bank w.e.f. 3rd December, 1988 on account of his alleged absence from duty is legal and justified? If not, to what relief is the workman entitled to?”

2. The respondent no.3 workman was employed as a Class-IV employee with the erstwhile Lakshmi Commercial Bank which had merged with the petitioner Canara Bank. The respondent no.3 workman was at the relevant time posted at Bulandshahr; he applied for medical leave which was sanctioned for a [period of four months]. It is the case of the petitioner bank that the respondent no.3 workman remained absent unauthorizedly from 14th November, 1985 to 14th March, 1988 inspite of letters dated 20th August, 1986, 8th October, 1986 and 13th January, 1987 asking him to report for duty. It appears that the respondent no.3 workman joined duty of the petitioner bank after 14th March, 1988 but again absented without information / leave application w.e.f. 25th May, 1988. A letter dated 5th August, 1988 is stated to have been issued to the respondent no.3 workman to join duties and which remained un-replied. The petitioner bank on 20th September, 1988 issued a notice to the respondent no.3 workman in accordance with Clause XVI of the IVth Bipartite Settlement Agreement between the petitioner bank and its employees, calling upon the respondent no.3 workman to join duty within 30 days and further informing him that upon his failure to so join the duty, he will be deemed to have voluntarily retired from the services of the petitioner bank on the expiry of 30 days therefrom. The said notice was served on the respondent no.3 workman on 3rd October, 1988.

3. The respondent no.3 workman sent a letter dated 2nd November, 1988 to the petitioner bank requesting another 30 days time to join duty. It was stated in the said letter that the children of the respondent no.3 workman had been severely ill for the last six months; two of the children were stated to be suffering from polio and in whose care the respondent no.3 workman claimed to be busy; he also stated that he was neither employed elsewhere nor carrying on any business. The respondent no.3 workman also stated that he could take complete medical care of his children in Delhi and requested for transfer to Delhi and promised that if transferred to Delhi, he will perform his duty diligently. However, the respondent no.3 workman did not join duty within the said 30 days of 2nd November, 1988 also and the petitioner bank on 7th December, 1988 issued a letter deeming the respondent no.3 workman to have voluntarily retired from service of

3 Delhi High Court 29 April 2010 WP(C) 14906/2004 The Judgment was delivered by : Hon'ble Justice Rajiv Sahai Endlaw

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the petitioner bank with effect from 3rd December, 1988, in terms of Clause XVI of the IVth Bipartite settlement agreement as aforesaid.

4. Upon dispute being raised by the respondent no.3 workman, reference aforesaid was made. The Industrial Tribunal has in the award impugned in this petition held that there was no ground for the petitioner bank to proceed under Clause XVI aforesaid; there was nothing on record to show that the respondent no.3 workman had no intention to continue in the service of the petitioner bank or had taken employment elsewhere. It was further held that the petitioner bank had not considered the request of the respondent no.3 workman in his letter dated 2nd November, 1988 for transfer and not even replied to the same. It was held by the Industrial Tribunal that Clause XVI applies only in cases of desertion i.e. where there is absence from duty without any intimation and if there is any intimation from the employee but the absence is unauthorized, the petitioner bank should take action in terms of disciplinary procedure laid down in the settlement agreement and not in terms of Clause XVI aforesaid. The Industrial Tribunal accordingly directed reinstatement of respondent no.3 workman but with only 30% of back wages.

5. Aggrieved therefrom this writ petition has been preferred. This Court vide order dated 13th September, 2004 stayed the operation of the impugned award subject to the petitioner depositing the awarded amount in this court. A sum of Rs.93,478.65p was deposited by the petitioner. The said order has continued till now.

6. The respondent no.3 workman died on 5th January, 2006 and his legal heirs were substituted vide order dated 24th January, 2007. The respondent no.3 workman prior to his demise had made an application under Section 17B of the I.D. Act. This Court vide order dated 13th March, 2007 directed the petitioner bank to pay the last drawn wages to the legal heirs of the respondent no.3 workman, from the date of the award till the date of the demise of the respondent no.3 workman. The amount of Rs.93,478.65p deposited by the petitioner was also ordered to be released to the legal representatives of the respondent no.3 workman and has been received by them.

7. The petitioner bank has however not complied with the aforesaid order under Section 17B of the I.D. Act. It is the stand of the counsel for the petitioner bank that in terms of the said order, a sum of only Rs.32,145/- was payable; that the respondent no.3 workman had taken a housing loan from the petitioner bank and amounts were due where-under; that the petitioner bank instituted a suit for recovery of the said amounts in the Court of the Civil Judge, Bulandshahr and a decree passed in favour of the petitioner bank. The petitioner bank in the affidavit dated 28th March, 2008 filed before this Court stated that a sum of Rs.41,362.75p was due under the said decree. Subsequently, in the affidavit dated 24th July, 2009, it is stated that a sum of Rs.80,558.75/- is due under the said decree. The amount payable in compliance of the order under Section 17 B of the I.D. Act was thus sought to be adjusted against the said amounts. The counsel for the legal heirs of the respondent no.3 workman however states that the decreetal amount stands paid. The counsel for the petitioner bank after taking instructions controverts.

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8. The Supreme Court in Punjab & Sind Bank Vs. Sakattar Singh 2000 Indlaw SC 2631 has held that no enquiry may be conducted where the standing order of the bank provides a procedure for treating such absentee employee to have deemed to have voluntarily retired after a particular period of unauthorized absence. To the same effect is the recent dicta in The Regional Manager, Central Bank of India Vs. Vijay Krishna Neema AIR 2009 SC 2200 2009 Indlaw SC 433. The counsel for the petitioner bank in this regard relies on Viveka Nand Sethi Vs. Chairman, J&K Bank Limited 2005 (5) SCC 337 2005 Indlaw SC 363.

9. Clause XVI in the IVth Bipartite agreement of the petitioner bank does provide a procedure for treating an absentee employee to have deemed to have voluntarily retired after a particular period of unauthorized absence. The validity thereof cannot be thus in doubt. What remains to be considered is whether such procedure has been complied with or not. However, before proceeding to determine the aforesaid factual aspect, the legal position may be clarified further.

10. The Division Bench of this Court in Shakuntala's Export House (P) Limited Vs. Secretary (Labour) 2005 Indlaw DEL 747 held that abandonment amounts to misconduct which requires proper enquiry. The judgment of the Single Judge of this court upheld by the Division Bench is reported as 117 (2005) DLT 479 2005 Indlaw DEL 747. To the same effect is another judgment of this court in MCD Vs. Begh Raj 117(2005) DLT 438 2005 Indlaw DEL 830 laying down that if the workman had abandoned employment, that would be a ground for holding an enquiry and passing an appropriate order and that having not been done, the action of MCD could not have been sustained. The Supreme Court in D.K. Yadav Vs J.M.A. Industries Ltd (1993) 3 SCC 259 1993 Indlaw SC 279 has held that even where the standing orders of the employer provided for dismissing the workman from service for unexplained absence, the same has to be read with the principles of natural justice and without conducting domestic inquiry and without giving an opportunity of being heard, termination of service on the said ground cannot be effected.

11. Thus even though Clause XVI of the IVth Bipartite Agreement does provide for a procedure, what needs to be determined is whether the same was complied and the principles of natural justice were satisfied or not.

12. The purpose of the procedure prescribed is to enable the bank to consider the explanation if any rendered by the employee in response to the notice required to be issued under the said clause. In the present case though the respondent no.3 workman had sent a reply within 30 days of the notice but the petitioner bank has not considered the said reply before issuing the order dated 7th December, 1988 of deemed voluntary retirement from the service of the bank. The Supreme Court in Viveka Nand Sethi 2005 Indlaw SC 363 (supra) found the appropriate authority of the Bank in that case to have considered the explanation furnished by the employee. The purpose, in Clause XVI aforesaid, of issuing the notice is to enable the appropriate authority in the bank to apply its mind as to whether a case of deemed resignation is made out or not. In the present case, the explanation furnished by the respondent no.3 workman in his response dated

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2nd November, 1988, giving reasons for his absence and seeking transfer to Delhi have not been considered at all before issuing the order of deemed voluntary retirement. The order is absolutely silent in this regard. The principle of natural justice of giving an opportunity of being heard is not to be an empty or abstract exercise. Giving of an opportunity of hearing has a corresponding obligation to deal with the representation/explanation and to give reasons for the decision. An opportunity of hearing would be meaningless and its purpose would be frustrated, if the authority giving the hearing does not consider the representation of the noticee or does not give any reasons for agreeing or disagreeing with the same. The principle requiring reasons to be given in support of an order is a basic principle of natural justice and it must be observed in its proper spirit and mere pretence of compliance with it would not satisfy the requirement of law (see Maruti Udyog Limited Vs. Income Tax Appellate Tribunal 2001 Indlaw DEL 76 and Assistant Commissioner Vs. Shukla & Brothers 2010 Indlaw SC 276).

13. As discussed herein above, mere absenteeism is a misconduct requiring enquiry. The Courts have held Clause of deemed resignation to be valid provided procedure is provided therein and the principles of natural justice are followed. In the present case, principles of natural justice have not been followed. Therefore, there is no compliance with the procedure provided in the Clause of deemed retirement. No case for interference in the award is made out.

14. However, the relief of reinstatement is now not possible in view of the demise of the respondent no.3 workman. The respondent no.3 workman remained alive for approximately two years after the date of the award. The award in so far as for the relief of 30% back wages has already been complied with as aforesaid. I deem it appropriate to award lump sum compensation to the legal representatives of the respondent no.3 workman in the sum of Rs.1,00,000/- in lieu of reinstatement. The said amount is besides the liability under Section 17B. In view of the conflicting statements regarding payment of the amount of the decree obtained by the petitioner bank against the respondent no.3 workman, the same shall have no bearing in so far as the payment of the compensation aforesaid is concerned.

15. The writ petition is therefore dismissed. However in view of subsequent event of demise of workman the award in so far as for reinstatement is modified as aforesaid to payment of lump sum compensation of Rs.1 lac in lieu of reinstatement. The petitioner bank is directed to make the payment of said compensation amount within six weeks hereof failing which the same shall incur simple interest at 10% per annum.No order as to costs.

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A. K. Verma v. Union of India, Ministry of Railways, through Chairman Railway Board and others4

This matter involves larger national interest of administrative hierarchy qua supremacy, responsibility and accountability and the relationship between the three arms of the State. It basically concerns the power and duty of discretion and exercise thereof.

In Mohambaram vs. Jayavelu ‘reported in AIR 1970 Mad 63 1968 Indlaw MAD 168 at page 73, the Hon’ble High Court of Madras had made the following remarks: There is no such thing as absolute or untrammeled discretion, the nursery of despotic power, in a democracy based on the rule of law.

It is widely agreed that one reason for having constitutions is the need to restrict the exercise of power. Modern states are excessively powerful and are believed to have a monopoly of force and coercion. What if the institutions of such states fall into the wrong hands, who then abuse this power? Many believe that this is not just a hypothetical possibility but inherent in the exercise of power and therefore in the nature of states. Even if these institutions were created for our safety and well being they can easily turn against us. Experience of state power the world over shows that most states are prone to harming the interests of at least some individuals and groups. If so, we need to draw the rules of the game in such a way that this tendency of states is continuously checked. Constitutions provide the basis of rules and therefore prevent states from turning tyrannical.

This traditional reason is not the only one supporting constitutions. The framers of our Constitution were deeply aware of three other reasons, two of which were already known but had been systematically underemphasized and a third which they themselves helped shape. Traditionally, constitutions were meant to control the power of the state so as to enable people to live decently. But this ideal presupposes an unbridgeable distance between people and the state. It assumes a powerless people who need the help of law to control state power. But what if people themselves have power? What if the power of the state comes from an original power that resides in the demos the people? Why then would we need constitutions? Democracy, it might be argued, is an alternative to constitutionalism. State power might be limited not by some higher law but by the power of the people.

This is an attractive but flawed idea. It is flawed because in practice, power never really resides in all the people but largely in the majority. The tyranny of the non-democratic state of which individuals might be victims is replaced in democracies by the tyranny of the majority. If so, we need constitutions to check the tyranny of a majoritarian, democratic state. We need constitutions because they give us laws to protect not only individuals but also minority groups.

4 Central Administrative Tribunal PRINCIPAL BENCH, NEW DELHI 6 May 2010 Original Application No. 2799/2009 The Judgment was delivered by : Dr. K. B. Suresh (Judicial Member)

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Moreover, constitutions are required not only to protect vulnerable individuals and groups but virtually everyone against human vulnerability in general. It is important not to forget that human being are fallible, that they sometimes forget what is good for them in the long run, and they yield to temptations which bring them pleasure now but pain later. It is not unknown for people to acquire the mentality of the mob and act on the heat of the moment only to rue the consequences of the decision later. By providing a frame work of law culled over from years of collective experience and wisdom, constitutions prevent people from succumbing to currently fashionable whims and fancies. Constitutions anticipate and try to redress the excessively mercurial character of everyday politics. They made some dimensions of the political process beyond the challenge of ordinary politics. The framers of the Indian Constitution were familiar with each of these three reasons for having a constitution. They understood that constitutions are needed both to check state power and majority tyranny and also to control the destabilizing swings generated by popular passion.

So far we have spoken of what constitutions dis-enable us from doing. However, constitutions also provide us with peaceful, democratic means with which to bring about profound social transformation. Moreover, for a hitherto colonized people, constitutions announce and embody the first real exercise of political self-determination. Nehru understood both these points well, The demand for a Constituent assembly, he claimed, represented a collective demand for full self determination, as only a Constituent Assembly of elected representative of the Indian people had the right to frame India’s Constitution, without external interference. Second, he argued, the Constituent Assembly is not just a body of people or a gathering of able lawyers. Rather, it is a ‘nation on the move, throwing away the shell of its past political and possibly social structure, and fashioning for itself a new garment of its own making.’ The Indian Constitution was designed to break the shackles of traditional social hierarchies and to usher in a new era of freedom, equality, and justice. Inscribed in the intentions of the framers of the Indian Constitution was the potential of a breakthrough in constitutional theory; constitutions exist not only to disenable people in power but also to empower those who traditionally have been deprived of it. Constitutions give vulnerable people the power to achieve collective good.

Let me give two examples. The first is the relationship between individual and group rights. On the one hand, there is the view that political discourse in India is dominated by community rights. When the language of rights arrived in India and was adopted in an Indian context charged with strong community values, it got detached from its individualist moorings and was applied to communities. On the other hand, another view exists that a characteristically un-Indian Constitution imposed an individualist morality on a community-oriented Indian society and did not care even to recognize group rights. Does the Constitution prioritize individual rights or group rights? Even a cursory glance of the Constitution dispels both these misinterpretations. In India, both sets of rights were recognized and no clear guideline was provided for just when one is to override the other, and no general criteria were provided to resolve conflicts between the divergent types of

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rights. An attempt was made instead to balance them, with the scales tilting marginally in favour of individual rights.

Thus, the seeming problem of a transfer of an individual is on closer inspection, a reflection of a Constitutional situation . Now; where and how do we, as citizens place ourselves? As uninterested spectators/or part of the matrix of concerned citizenry?. Regard must be had to the fact that concerned this is a project which will ultimately swallow up at least Rs. 25,000/- crores of national wealth in the long run.

In this context the case before me has to be analysed.Factual Matrix

This case basically relates to transfer. I am inclined to see it as not only concerning an individual but concerning the whole nation and in respect of the duty cast on me as a servant of the people. The respondents in their reply in para 3 has stated that who should be transferred where, is a matter for appropriate authority to decide. Unless the order is vitiated by malafide or is made in violation of any statutory provision the court cannot interfere with it. While ordering transfer, there is no doubt; the authority must keep in mind the guidelines issued by the Government on the subject. Similarly if a person makes any representation with respect to his transfer, the appropriate authority must consider the same having regard to the exigencies of administration. The guidelines say that as far as possible, husband and wife must be posted at the same place. The said guideline, however, does not confer upon the government employee a legally enforceable right. The jurisdiction of the Central Administrative Tribunal is akin to the jurisdiction of the High Court under Art. 226 of the Constitution of India in service matters. This is evident from Art. 323-A of the Constitution as made clear by the decision of the Apex Copurt in the case of S.L. Abbas vs. UOI [1993 (2) SLR 582]. In para 4 the respondents would content that Courts or Tribunals are not appellate forums to decide on transfers of officers on administrative grounds. The wheels of administration should be allowed to run smoothly and the courts or tribunals are not expected to interdict the working of the administrative system by transferring the officers to proper places. It is for the administration to take appropriate decision and such decisions shall stand unless they are vitiated either by malafides or by extraneous consideration without any factual background foundation. In this case; on administrative grounds, the transfer orders came to be issued and therefore the Court cannot go into the expediency of posting of a particular officer at a particular place as made clear by the Apex Court in the case of State of Madhya Pradesh and others vs. S.S. Kourav [JT 1995 (2)SC 498]. The respondents have also placed reliance on para 5 of the reply. ‘Interference by the Courts in the matter of transfer should be rarest of the rare as has been held in Prasar Bharti vs. Amarjeet Singh [2007 2 SCC (2) L&S 566] and Mohd Masood vs. State of U.P. [2007 (1) Scale 271]. They would further say that applicant is SAG/ IRSE, and as a Member of Group A organized service of Indian Railway Service of Engineers [ IRSE] with transfer liability to all over Indian Railways. Apparently they would say that the applicant had been ordered to be transferred vide Railway Board’s order No. E (O) III/2009/TR/445 dated 04.09.2009 and posted to South East Central Railway. This order is under challenge. The applicant would further say that the order is the outcome of the malafide and malice on the part of respondent No. 2 Shri

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Rakesh Chopra, Member Engineering , Railway Board. Apparently Shri Rakesh Chopra, presently Member Engineering was the then Chief Administrative Officer of the J & K Rail link project. He would say that he had submitted a detailed report raising the concerns about the methodology being adopted for alignment of a segment of J & K Rail link project and Shri Chopra, the then Chief Administrative Officer of the project and the General Manager, Northern Railway was not in harmonious agreement with it. He would also say that the applicant had submitted various alternative/modified alignment which would provide safe and reliable and efficient transportation of passengers and freight. At this the respondent would further say that the opinion of the applicant was not finally implemented by the high level authority and there is no ill motive against the applicant for that reason. The Railway would contend that the applicant has assailed the order on the ground also that there are large number of officers who are having longer tenure than the applicant but it is part and parcel of the administration that some people may get longer posting in a particular place due to administrative interest. They also said that large number of officers in the grade of SAG did not work in Delhi upto the level of SAG or above. They would say that the applicant had been transferred during mid academic session which would affect adversely the education of children. But it is also stated by them that such problems are general with officers of his age and status. On the basis of above averments the respondents have prayed for dismissal of the O.A.

I have heard both parties and carefully gone through the documents submitted by both parties. I feel that an indepth examination is called for or else I will not be doing justice to the position of trust addressed and bestowed in me as a public servant.

It seems that J & K rail link is a national project of strategic importance. I also had a close look at Annex. A/3 which is a letter No. KR/CO/MD/09/03 dated 19.09.2003 written by Shri Rajaram of Konkan Railways, addressed to the respondent No. 2. This relates to the alignment of J & K Railway project. He seems to have raised several points in relation to the project. The relevant portion reads as under:

“The paper alignment without even preliminary ground reconnaissance, without initial pegging but only proceeding with partial surveys with partial ground details and then going ahead with calling of tenders and committing the national resources is causing serious concern. We may be in a hurry, but without first conducting even a simple engineering survey the ground details launching on construction from either end is fraught without serious consequences. We may end up with infructuous expenditure and at the same time we also are not giving true picture in terms either cost or time.

It is only with an intention to help things out, I had to explore the alternatives as well as examine the paper alignment also whether we can comfortably proceed with the same. The results are not encouraging. Let us take first the paper alignment itself from the national remote sensing satellite images as well as GSI records. Professor Nagarajan of IIT Mumbai and Director of GSI confirmed that paper alignment is virtually following the areas of Riasi Thrust, Sirban Thrust, Muree and Panjal Thrust.

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“Track ( 26km) running parallel to thrust line and within, is not desirable at all Thrust area is different from the fault lines. Thrust areas are very active. While in case of fault lines one may have difficulty in the construction period which we may resolve by taking some mitigating steps. But in case of thrust areas, it is going to be a problem for the next century.. The geo physical features will always be dynamic and even if we spend more money and construct the line, during operation and maintenance, our engineers will be put to very serious concerns. The passengers who will travel on the line are exposed to serious hazards. If we can help it, we should definitely avoid such thrust areas. We have to accept that we cannot fight nature, whatever the contract amount we are going to shell out.

The combination of thrust areas along with almost 148 portals and 62 bridges, some of which are going to be very unique in the word is not exactly the scenario which gives rise to sound security and safety, both in terms of geo physical concerns as well as proximity to the line of control and national security. It is doubtful that the purpose of strategic importance will be served.

In any engineering alignment we must pick up the obligatory point in terms of technical feasibility of major construction feature like cross of major river which in this case is Chenab river. We tried to look for alternative crossing point for Chenab river and I am happy that very feasible crossing point is available. After choosing this point we should fix the alignment, avoiding thrust areas. After matching with the levels, we get an alignment, which actually becomes half the length and reduces the number of portals to only 8 and the bridges also to just about 2 nos. Initially when this was presented as a concept a view was taken that there were no ground details and also any way we cannot accept 1 in 50 gradient. There is no reason why 1 in 50 gradient cannot be managed. “there will be a saving of at least Rs. 3,000/- crores when we adopted this alternative alignment.

The question arises as to why we should not examine the alternative honestly in the interest of the nation. In fact the safety concern of the tunnels is very real and with my experience on Konkan Railway single line tunnels, in case of hazards, create very serious problems. In the alternative alignment these issues also are addressed .

You are an outstanding officer of our cadre and I do urge you, not to hastily force the finalization of contracts for a partially examined alignment, with no guarantee to where we are going to reach, because we have only a paper concept alignment with no ground details.”.

The above letter was written in the year 2003. Apparently in the interregnum the applicant was posted as CE/C/ NEC and therefore when the 2nd respondent would suggest that the contracts were finalised and the contractors were to be paid the actual cost along with the percentage as assured profits as methodology of execution of work. Thus there is no real accountability for the congtractors. My attention was also drawn to DO No. 2005/CRB/Misc./1 dated 18.07.2005, which is a letter issued by the Chairman Railway Board addressed to the applicant. The letter reads as under:

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“Sub: Report of the Task Force set up to review the operational

Maintenance and safety requirement of the new railway line under the Udhampur-Srinagar-Baramulla Rail Link project.

A comprehensive review of the operational, maintenance and safety requirements vis-a-vis in the DPR has been carried out by the Northern Railway. As the Chief Engineer in charge of the section of the region where most of the construction problems were going to arise due to the difficult terrain and adverse geology that necessitated a review and additional measures, you have ably projected the need for the review, and then as the convener of the Task Force that was set up to review the provisions of the DPR, you have helped formulate options, examine their feasibility, and steered the recommendations of the Task Force to the stage of their approval by the General Manager/Northern Railway and apprising the Railway Board. This is in recognition of the good work done by you.

It appears that the applicant had given a presentation to the high level expert committee based on geo-physical data. He had also sent the report to various authorities. In his report he would draw the attention to what is indicated by the world practice and the body of scientific knowledge to be the most important requirement that should be met by an alignment for a rail line in a higher relief mountainous region. He also suggested that the lines should be laid across the axis of folding of the mountain ridges to minimize the serious engineering problems likely to be posed by the fault lines, shear zones and other discontinuities which tend to lie along the folding axis. He states that the conditions in the lesser Himalayas are among the most unfavourable in the world because of the young age of Himalayas, the great collision of continental plates which geologists believe was perhaps one of the most impact full collisions of earth’s crusted plates, and last but not the least, the predominance of young sedimentary and low grade metamorphic rocks which underwent intense folding, faulting and shearing under the tectonic forces.

Impressed by the findings of the applicant, the then Member (Engineering) Ministry of Railways, Government of India, vide DO Lr. No. 86/W-2/NL/NR/25 PT ‘IV.COM dated 30.03.2009, addressed a letter to legendary engineer Mr. E. Sreedharan, who had constructed the Pamban Bridge and and headed the Konkan Railway Project. The letter states about the proposal for the change in alignment which has been made 18 months back on that date. It also mentions that IRCON and KRCL who are executing parts of the project, have faced serious difficulties in construction and have sought some changes in alignment too and sought Shri Sreedharan’s views in the matter. The letter is produced as Annex. A.30. annex. A/31 is the detailed report for change in alignment on the Katra Qazigund part of the J&K project. The report further states that the cost works to be abandoned would be about Rs. 780 crores. A plain reading of the report would indicate that serious objections are made to the alignment. Annex. A/32 is a letter issued by Member Engineering at that time congratulating the applicant. The relevant portion reads as under:

Subject: Review of alignment on Katra Banihal section of the J&K Rail Link project You have worked with utmost diligence and dedication for acquiring an understanding of the

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basic causes of the problems that have been faced with the present alignment in the above part of the project. Your 1st representation to the Board on 08.11.2007, ‘A world view of the Fundamentals of Building Railways in High Relief Mountains: An Insight into the Shortcomings of the Present Alignment and a Proposed Modified Alignment’ has provided necessary ground work for further work. I have also perused your last report of last week addressed to CAO/C and copy to me.

The insights you brought out with your extensive study of the problems has led to the realization that tunnels laid at shallow depth under the slopes and bridges and stations in the openings in Khads etc in the extremely unfavourable conditions of terrain and geology require a serious relook. The alignment with tunnels cutting across the main mountain ridges and fault lines, with bridges , tunnel portals and stations, in openings in wider valleys; has certainly been valuable suggestion. Train operations, overall viability of the line considered has brought out a much more safe and survivable line”

In reply to the letter dated 30.03.2009, written by the Member ( Engineering) Mr. Sreedharan, replied to one Sri Ravindra, Chairman High Level Expert Committee vide his letter dated 19.05.2009 and the relevant portion reads as follows:

“Right from 2002 onwards when Railways decided to take up the Rail Link to Srinagar, I was opposing the present contour alignment and had suggested that a direct route through long tunnels, cutting across fault zones should be adopted reducing drastically the overall length. This view was also shared by the Konkan Railway Corporation. By adopting a straight alignment with long tunnels, not only the total length of tunneling can be brought down, the number of bridges could be reduced the total haulage length also considerably reduced. This would, however, necessitate a ruling gradient of 1:40 for which I do not think formidable from operational and safety point of view if electric traction and compressed air braking is adopted.

During the last 7 years the project on the present alignment could show only a progress of 10% At this rate the project would take another 20 years for completion and the cost would go up 4 to 5 times. The resultant alignment will not be stable and the high bridges would be highly vulnerable from security point of view.

What had happened to this recommendations is not available before us. It seems that the same was discussed in the media also. The relevant portion published in “The Times of India” reads as under:

“Sreedharan’s intervention in the J & K project follows a request made to him on March 26 by the then member (engineering) in the railway board, S.K. Vij, five days before his retirement. Having already rolled back the unviable component of building the world’s highest arch bridge on Chenab across an unstable gorge, Vij sought Sreedharan’s help in an obvious bid to counter the powerful lobby within the railways which wanted the present alignment to be retained lest thy be held accountable for losses running into hundreds of crores.

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Sreedharan backed Vij’s idea of switching to a straighter and shorter alignment, which is designed to avoid exposure to landslides as it uses advanced technology of tunneling through mountains from Katra to Banihal. As a corollary, Sreedharan endorsed the proposal of increasing the gradient from 1:100 to 1:40 since the entire route would any be electrified.It remains to be seen whether the expert committee, will accept Sreedharan’s advise to depart completely from the present alignment. The committee headeded by former railway board chairman M. Ravindra is however undue pressure to suggest retention of the present alignment with minor changes. This is because, Vij’s successor Rakesh Chopra and member Shri Prakash issued an order last month stating that the gradient should in no circumstances exceed 1:80.

The order seeks to undermine the discretion of the expert committee as it makes it harder to straighten the present serpentine alignment and raises the prospect of reviving the much touted Chenab bridge.”

It would appear that vide Annex. A.36, the applicant wrote a letter dated 28.04.2009 to the General Manager, Northern Railway and sought a clarification regarding his future role in the process of implementation of the project. Apparently in reference to the office order dated 27.04.2009 he sought this clarification. This does not seem to have been answered. This was followed by another letter dated 24.06.2009 ( Annex. A/37) which pointed out serious implications of missing important information and the inaccuracies reflected in the report of the Expert Committee on review of the alignment on Katra Banihal Section of the J & K Rail Link Project. Annex. A/39 is a letter dated 10.07.2009 which seems to indicating serious omissions/ Anomalies/ wrong statement of facts/ and much vagueness in the Expert committee’s report.

The applicant has further stated in that letter that IRCON and KRCL officers were frequently called by the committee but he was kept out of the same after he presented his report on 09.01.2009 and further stated in that letter that the committee has gone on to recommend formation of a committee of officers of Northern Railway, IRCON & KRCL to draw alignment on the basis of its recommendations. The applicant has also stated that IRCON and KRCL have consistently ignored the safety issues. This views of the applicant were further supplemented by another letter dated 30.07.2009 written by the applicant to the Chairman, Railway Board which contained the detailed report, remarks and comments of the expert committee. These were further followed by Annex. A.41 a letter dated 07.09.2009 written by the applicant to the Member Engineering, requesting the Railway Board to reconsider the above transfer and allow him to continue to work at Delhi for some more time. The reconsideration was sought on several grounds including medical complexities to which he is afflicted. This is followed by annex. A.42, which is a letter issued to Shri S.S. Khurana, Chairman Railway Board, New Delhi. In that letter among other things, the applicant had stated in para 5 as under

“5. that the previous Member Engineering had sent a note to the Hon’ble Minister of Railway about the alignment in the second week of March 2009 before his retirement. This note highlights how the safety, security and long term survivability issues continued

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to be ignored by those opposed to adoption of an alignment based on the more appropriate alignment concepts. It specially makes mention of the dubious role of the consultant Amberg and IRCON in this regard.”

This is followed by another letter dated 29.09.2009 which the applicant seems to have issued to the second respondent indicating that there are several officers who had longer tenure than the applicant at Delhi and that he had been victimized for his opposition of the alignment in the Railways.

The applicant in his rejoinder to the reply of R.4 had enclosed a note dated 14.03.2009 from Shri S.K. Vij, to the Minister of Railways. He also enclosed another note from R.2 dated 25.04.2009, marking the same to Member ( Technical ). It states that the file has been withdrawn by EDW from the office of Minister of Railways, since R.2 wanted to know the status of progress on the national project. The relevant portion reads as under:

“This file has been withdrawn by EDW from the office of MR since having taken over as ME from 1.4.2009, AN I needed to know the status of progress on this National project. Along with this file, two other files viz.,

(i) USBRL Project ( ME’s observations) No. 86/W 2/nl/n/25 Pt. IV (part file of WZ)Proposed change in alignment from Km.52 to 62 in Katra-Laole section of USBRL- File No. 68/W2/NL/N/25 Pt. III/W2

Have been put up. I have gone through the files and in particular the notings of ML placed as S. No. 50 (1-8) on the file; MT’s notings on NP 11-12; 14-15,20-22 and FC’s notings at NP 22 and at Sl. No. 45 of this file. Besides this, ME’s notes have been read. Essentially what has emerged is that:-

(i) Works have been stopped on spots and length with KRCL & IRCON from Katra to Banihal ( excluding the Banihal tunnel).

(ii) Expert Committees- particularly two i.e. M/s Ambergs and the other under Mr. R. Ravindra have been set up to study the alignment and technical issues.

(iii) Gradients have been proposed upto to 1 in 44, presumably without slip and Catch sidings ( so far mandatory as per rules for grades steeper than 1 in 80)

However, notes as recorded on operational issues by ML AM/L and MT do not favour steep gradients.

Having learnt this, a review meeting was held with CAO/C-II/ N./ Rly to ascertain the status. It is understood that there are three legs of this project viz:-

1. Udhampur- Katara All MBG Loading designed.

2. Katra- Quazigund --do--

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3. Quazigund- Baramulla -- do--

Besides this JAT Udhampur has been constructed with RBG/MBG loading.

(i) Work on Udhampur-Katara is complete but for tunnel T-I at Udhampur which has had trouble for the last 203 years and it has taken sometime to find a solution. It is now expected that work will start on this from June/July-2009.

(ii) On Katra- quazigund section, work has been stopped (excluding Quazigund tunnel)

(iii) Work on the Quazigund- Baramulla is complete between Anantnag and Baramulla and trains are running. For Anantnag to Quazigund, it is expected to be completed by June 2009Direction of Board, appears to propose three alternative alignments with 1 in 60, 1 in 50 and 1 in 44 gradient.. Report yet to come.

As per the current policy of Railway Boarad, the provision of catch siding is essential on grades stepper than 1 in 80. Further, as per the Schedule of Dimensions, 2004, the slip siding or other arrangement becomes necessary if a passenger line is joined on a steeper gradient than 1 in 260 i.e. in the yeards. Since all the yards on Katra- Quazigund will have a minimum gradient of 1 in 400 or flatter, slip siding would not be necessary.

The matter was discussed with the MT on 21.04.2009 and keeping in view the requirement of catch siding on gradients steeper than 1 in 80 it was considered appropriate to explore the possibility of refining the existing alignment following a maximum gradient of 1 in 80 in stretches where gradient steeper than 1 in 100 essential . It was also considered that while doing the refinement of the existing alignment, attempts should be made to keep the curvature restricted to 2.75? but may go upto 4? at isolated locations if the same is required to meet a better geology and/or better location/lay out of the yards etc. This should also be operationally beneficial.

Even for the new alternative solutions, the Consultant’s terms of reference can be revised to follow the gradient and curvature as proposed for the refinement of the existing alignment above.

MT may please indicate his agreement to the above proposed limits of gradients and curvature before N. Rly is be advised accordingly”

Therefore, it appears that the allegation of the applicant that when the Hon’ble Minister for Railways had agreed to the proposal on the alignment the opposition made have been kept away from the knowledge of the Hon’ble Minister for Railways. Therefore the Minister for Railways might have acted without adequate data or the data made available might have been manipulated. Thus this manipulation may seem to be constituting a forgery under the criminal laws of the nation. To understand as to what extent the manipulation existed it should be looked into more deeply but that, however, is not available for the Tribunal. Therefore, I am of the considered opinion that this should be

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looked into by the cabinet secretary in view of the great national importance. After going through the report, the second respondent vide his note dated 02.07.2009, had stated as under:

“ In the above background and being a national project of enormous importance, as also observed by Hon’ble Minister for Railways and keeping in view the public aspirations at large, in principle approval and acceptance of the committee’s report to recommence the work on existing alignment is recommended, for consideration of the Hon’ble Minister for Railways”

This view seems to have been supported by Member Traffic on the ground that from operational point of view, the existing alignment is immensely suitable as it would pursue smooth movement of both freight and passenger trains to the valley.

It appears that the report of the committee might not have been seen in juxta position to the objections raised not only by the applicant but by other learned engineers as well by the Hon’ble Minister for Railways before issuing the approval. After going through the report I can only find that anybody who had opposed the present alignment in any fashion would have been left out of the decision making process in anyway.

Annex. A/5 filed along with the rejoinder, which is a letter No. 86/W2/NL/25/Pt. IV dated 24.04.2009, written by second respondent to Shri Vivek Sahai, General Manager, Northern Railway, requesting him to transfer the applicant. Annex. A/6 is the details of committees and its visits to various places, in which the applicant was not involved in any of the committee’s deliberations even though it is his objections that caused the genesis of the committee.

The applicant is assailing the impugned order of transfer on the ground of malice, malafides and palliative reasons which are available to the applicant on the basis of various Apex Court rulings. But as observed above, this does not concern the transfer of an individual alone and should be viewed in a larger context.

The respondents have submitted that they have got powers to transfer the applicant and it is in their discretion to post a person under them in a place where his services could be utilized properly. The following questions arise for determination on stipulation of the respondents:

Whether or not the wheels of administration can run smoothly without interdiction and without interference.

Whether or not the administrative discretion is vitiated by malafides, if so, to what extent in present case.

Whether the extraneous considerations be considered as vitiating factors in exercising administrative discretion.

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Can administrative reasons lie without any factual background of sound foundation.

These are questions that must be answered by this Tribunal and as posed by the respondents in their reply.

Now I shall examine the legal matrix on the issue involved in this case.

A constitutional bulwark against uncontrolled or unfettered discretion in Indian law is Art. 14 of the Constitution which provides for the principles of ‘equality before the law’ and ‘the equal protection of laws’. This is buttressed by Art. 15 expressly prohibiting discrimination on grounds of religion, race, caste, sex or place of birth. Article 16 states positively that there shall be equality of opportunity in matters of public employment. Hon’ble Mr. Justice Fazl Ali. in State of West Bengal vs. Anwar Ali [AIR 1952 SC 75 1952 Indlaw SC 52] has stated ‘Unfettered discretion’ is liable to be used in a discriminatory manner and this is offensive to Art. 14. His Lordship has further held an act which gives uncontrolled authority to discriminate cannot but be hit by Art. 14. It has further been held that discretion exercised without any principle or without any rule is contrary to Art. 14. This pre supposes the factum in which administrative authorities are expected to negate any lacuna. The administrative actions, which were not followed by salutary principles of natural justice can be challenged by way of judicial review.

Similarly, in Santwant Singh vs. Assistant Passport Officer [ AIR 1967 SC 1836] the Hon’ble apex Court has observed that in the case of unchannelled arbitrary discretion, discrimination is writ large on the face of it. Such discretion patently violates the doctrine of equality, for the difference in the treatment of persons rests solely on the arbitrary selection of the executive. The Apex Court in State of West Bengal vs. Anwar Ali [ AIR 1952 SC 75], observed that an Act was held violative of Art. 14 because it had empowered the government to select any case or a class of cases or offences to be tried by special courts. This unfettered discretion is likely to be branded discriminatory and therefore contrary to Art.14.

In State of Maharashtra vs. Raj Kumar [ AIR 1982 SC 1301], the Hon’ble Apex Court has held that recruitment rules provided for the selection of candidates from rural areas. The provision that the candidates coming from rural areas who had passed the SSC examination held in villages or places with ‘C’ type municipality would be deemed to be rural candidates and be given weightage was held bad. The classification so made had no nexus with the object to be achieved. Discrimination of violative of Art. 14 if occurs, and if there is discrimination between equals and not where unequals are being treated differently judicial interdiction should lie. The Hon’ble Apex Court in State of Madhya Pradesh vs. Nivedita Jain [ 1982 1 SCR 759 1981 Indlaw SC 392], held that an executive order completely regarding the conditions concerning the minimum marks for selection of students to a medical college in respect of candidates belonging to scheduled castes was held not violative of Art. 14 or 15. as the relaxation was only in relaxation to the candidates belonging to the scheduled castes and only with regard to the places reserved for them. Taking these legal conceptions into account, I have to examine the retention of other similarly situated persons in Delhi, while singling out the applicant. The extent of

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discretion, at the hand of the respondents, must be held to be circumscribed by principles of good governance, non-arbitrariness, absence of malice and malafides etc.

The preceding discussion shows that the court would inquire whether the statue contains any policy or principles for guiding the exercise of discretion by the executive in the matter of classification if it does not, the statute is liable to be invalidated as having conferred ‘unfettered’ discretion to discriminate between persons or things similarly situated. If the statute contains such a policy or principle which negates at the concept of unlimited discretion it may leave its selective application to certain persons or objects. Such a legislation would be bad as held by the Hon’ble Supreme Court in Kedarnath vs. State of West Bengal [AIR 1953 SC 404].

The wisdom of legislative policy is not open to judicial review but when the wisdom takes the concrete form of law it must be in tune with the Fundamental Rights of the Constitution. Art. 14 stries at arbitrariness which involves the negation of equality. An action per se arbitrary denies equality of protection by law under Art. 14, as held by the Apex Court in A.L. Kalra vs. P & E Corporation of India Ltd.[ AIR 1984 SC 1361]

Thus Art. 14 has proved to be a valuable tool in restraining what has been termed in English Law as ‘unfettered discretion’. Thus, the Courts have demanded that administrative discretion must not be arbitrary. Its exercise must be based on reasonable and relevant criteria as has been held by the Apex Court in Nanhu vs. Delhi administration [(1980 ( supp) SCC 613] and such discretion must not be vague as held by the Apex Court in Nishi Maghyu vs. State of J & K [AIR 1980 SC 1975].

It is well settled rule of administrative law that an executive authority must be rigorously held to the standards by which it professes the action to be judged and it must scrupulously observe those standards on pain of invalidation of an act in violation of them. The impugned order of transfer in this case was passed in public interest. Where the executive may proceed under one provision or another in dealing with the matter and their choice is one of wide discretion unregulated by standards or rules, the resulting administrative action as well as the enabling statutory provision could be open to attack on the basis of Art. 14. Therefore, on what ground that the 2nd respondent had decided that the usefulness of the applicant at the present station have come to an end? Even in the face of specific challenge the respondents have not chosen to answer it. Why had he concluded that the applicant must therefore be transferred? What is the thought process which went through the mind of the concerned authority? Why and how had he decided that the applicant must be transferred in public interest? No answers are forth coming.

In State of Orissa vs. Dhirendra [AIR 1962 SC 1715 ] the Apex Court has held that where the executive had an absolute discretion to commence disciplinary actions against public servants as between two different rules, the relevant rules providing for such discretion was invalidated as being violative of Art. 14. This was followed in Jyoti Prasad vs. Union Territory [ AIR 1961 SC 160]. It has been held that the standard of ‘substantial extent’ which was sought to be the parameter available to the administrative authodrity was held to be an indefinite guide to the executive in the matter of selection. Absence of standards,

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principles and policies to guide the exercise of ‘absolute discretion’ is liable to render the resultant administrative action open to challenge. In this case, the modalities of application of mind is singularly and significantly absent.

In Kuljeet Singh vs. Lt. Governor of Delhi [AIR 1981 SC 1572] the apex Court held that at the heart of the matter is the problem of ‘justiciability. Although the courts do not characterize issues as’ political questions like their American counterparts they do feel hesitant to adjudicate upon certain issues. In the above case, the appellant had been convicted and sentenced to death for murder. He petitions for mercy to the President of India who is empowered under Art. 72 of the Constitution to grant pardons, reprieves, respites or remissions of punishment or to suspend, remit or commute the sentence. The C ourt held in favour of judicial review even though powers under Art. 72 and 161 are of a pleanary nature.

In S.R. Bommai vs. UOI [ AIR 1994 SC 1918] nine Judges Bench has held that exercise of discretion even under Art. 356 is open to challenge and interdiction.

Proportionality and Substitution of judgement:To what extent the administrative authorities could exercise its discretion. Whether the Court can supplant or supplement such discretion is a question of credence in this scenario.

As pointed out earlier, the linkage of the protection of the fundamental rights with judicial control has the consequence of enabling the Courts to act on the proportionality principle and in some cases substituting their own decision for those of the administrative authorities on the matter. This issue has surfaced in the Indian sub continent. At times, the Courts have acted on proportionality without explicitly acknowledging it. Thus, the Apex Court in the case of Regional Manager Bank of Baroda vs. Presiding Officer GCIT [AIR 1999 SC 912], wherein a bank employee made a false statement about his past criminal conviction in his application for a job, held that this was not such grave misconduct as to warrant a dismissal and ordered reinstatement. At the same time the Apex Court in the case of Sanchala Kashriv vs. R. Mehta [ AIR 1999 SC 578] which is a teacher’s case, wherein the teacher forged the signatures of the authorities on his service book to get his revised pay regularized, he was held to be guilty of serious misconduct and his dismissal was not viewed as disproportionate, for the reason that a teacher is expected to be a guide for the society and any lacuna on his/her part is to be viewed very seriously. Thus in principle the proportionality is an acceptable part of the jurisprudence in India and it is very relevant in the present case.

The House of Lords explained in the Brind case [[1991] 1 A.C. 696 ] that proportionality is a different principle from the ‘Wednusbury Irrationality test and it enables the courts to review the merits of a decision, going beyond the legality of it. In State of Karnataka vs. H. Nagaraj [(1998) 9 SCC 671 1997 Indlaw SC 335] the Apex Court has stated that the principle of proportionality can be invoked only in a case where the punishment was totally irrational in the sense that it was an outrageous defiance of logic or of moral standards. This is in fact, a statement of the Wednesbury Irrationality as explained by

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Lord Diplock in Council of Civil Service Unions vs. Minister for the Civil Service [[1985] A.C. 374 at 410] where he said:

“By irrationality, I mean what now can be succinctly referred to as ‘Wednusbury’ Unreasonableness. It applies to a decision which is so outrageous in its defiance logic or acceptable moral standards that no sensible person who had applied his mind to the question could have arrived at it.”

But at the same time Courts should make a way for margin of appreciation to the executive authority. It is seen that in American administrative law the prevalent trend is towards structuring discretion by formulating standards, policies and rules. Therefore the Hon’ble apex Court in the case of Shalini sone vs. UOI [ AIR 1981 SC 431 1980 Indlaw SC 283 held that it is an unwritten rule of the law, constitutional and administrative that whenever a decision making function is entrusted to the subjective satisfaction of a statutory authority there is an implicit obligation to apply his mind to pertinent and proximate matters only, eschewing the irrelevant and the remote. This legal position would cover the parameters of extraneous consideration and whether this fact would weigh the decision as is claimed by the respondents. In fact the process of application of mind by the respondents to seek out public interest is conspicuously absent.

In Ajantha Transports vs. TVK Transports [ AIR 1975 SC 123 1974 Indlaw SC 147] the Hon’ble Apex Court stated in general terms the proposition that the authority should not act mechanically in exercising their discretion. For the same reason, they should not receive dictation from another body. Thus a public prosecutor in deciding whether to commence prosecution or to discontinue criminal proceedings cannot be compelled to act by instructions from the Government as has been held by the Apex Court in Balwant Singh vs. State of Bihar [ AIR 1977 SC 2265]. The same principle has been enunciated by the Apex Court in Vijay Kumar vs. State J & K [ (1982) 2 SCC 43]

Therefore the notification of the second respondent to terminate the current service of the applicant in the current sphere by addressing a letter to the General Manager may be viewed as extraneous and which might vitiate the decision making process of the authority.

Therefore, wide discretionary powers, unstructured and unregulated by ‘principles, standards or guidelines are likely to be declared unconstitutional being inconsistent with a number of constitutional provisions in particular Art. 14 and 19

JUDICIAL CONTROL- REVIEW OF SUBJECTIVE DISCRETION

In English law, the scope of judicial review of ‘subjective satisfaction’ or discretion, the exercise of which is not conditional on the existence of ‘jurisdictional facts’ is determined by the Wednesbury Principle. We have seen that in effect this means that ‘subjective satisfaction’ of the executive is by and large immune from judicial review. But in India on law, this is to a large extent ‘justiciable’. For instance, in cases involving preventive detention the court would not accept a claim being ‘satisfied’ of the grounds

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of detention on the part of detaining authority. It would look at the record to see whether there is any evidence on the basis of which the authority could be so ‘satisfied’. The Hon’ble Apex Court in Menaka Gandhi vs. UOI [ AIR 1978 SC 597 1978 Indlaw SC 212] held that ‘satisfaction’ of the detaining authority must be based on sound material having a nexus with the activity of the detainee. Thus allegations unsupported by valid reasons cannot be a bench mark to decide preventive detention as has been held by the Apex Court in Bimla Dewan vs. Lt. Governor of Delhi [ AIR 1982 SC 1257 1982 Indlaw SC 131] The Apex Court has also held in Harnek Singh vs. State of Punjab [AIR 1982 SC 682 1981 Indlaw SC 601]that fact relied on which is too distant in point of time and offence committed in the past or a minor infringement of law claimed as an activity prejudicial to the maintenance of public order as has been held by the Apex Court in Jaya Mala vs. Home Secretary J & K {AIR 1982 SC 1297 1982 Indlaw SC 37}. Therefore, even prima facie, no compelling reason other than the personal dissatisfaction of the 2nd respondent existed to canvass the transfer of the applicant. But, why had he alone so? Why had the concerned authority merely followed it?. We need to deliberate on this as the respondents found their action on their powers.

‘Justiciability’ of subjective discretion has extended beyond the cases of preventive detention Thus in Menaka Gandhi’s case where the government impounded the petitioner’s passport but refused to furnish the reasons therefore ‘in the interest of general public’ the Supreme Court asserted its jurisdiction to scrutinize the claim not to disclose the reasons. The Government was not the sole judge of the matter. The Court found that non-disclosure of the reasons was not justified as no damage to the public interest was involved. In this case the Court went into all aspects of the matter and decided that the government was wrong. In fact, the Court assessed the damage caused to the public interest and read into all aspects what normally arises in such matters including subjective satisfaction of the administrative authorities.

‘Justiciability’ of ‘subjective discretion’ has been made possible by the constitutional frame work of judicial control of administrative action. Thus the Supreme Court in Menaka Gandhi’s case read into art. 21 the American doctrine of due process of law as as to require its observance in depriving a person of his life and ‘personal liberty’. In this case Hon’ble Mr. Justice Bhagwati also invoked art. 14 to say that art. ‘ensures fairness’ in state actions and any procedure which is not ‘right and just and fair’ ; is ‘arbitrary, fanciful or oppressive’ will be invalid( under art. 14). In his view a procedure which provides for curtailment of personal liberty without observance of rules of natural justice could not be ‘right and just and fair’ and would be invalid under Art. 14. The introduction of due process into Indian law has wider implications, Therefore where is just and proper in this case? Not only in terms of the requirement of the applicant but in greater nation interest also?

The Special Courts Bill 1978 case reported in AIR 1978 4781978 Indlaw SC 352 at page 517 relates to provision of transfer of a case from one special court to another without safeguards against bias was held to be contrary to Art. 21. Thus Art. 21 has emerged as an independent provision which required the observance of principles of natural justice in the spehere of personal liberty. This couples with Art. 14, 19, 21 and 136 which imposes

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the requirement of giving reasons for decisions has opened new possibilities for judicial control of subjective discretion.

While exercising the discretion, all administrative authorities are bound to give reasons ( i) when making decision. (ii) when justifying decision. The Courts have time and again held that if no reasons are given while exercising discretion, the same would be bad in law. Why the applicant has to be transferred is snot answered even now as obviously the project is not yet completed.

My attention was drawn to Indian Railway Establishment Code 1985 edition Chapter 2 which deals with general condition of service. Rules 226 to 233 deals with transfer. Rue 226 says that ordinarily a railway servant shall be employed throughout his service on the railway or railway establishment to which he is posted on first appointment and shall have no claim as of right for transfer to another railway or another establishment. In the exigencies of service, however, it shall be open to the President to transfer the railway servant to any other department or railway or railway establishment including a project in or out of India.

Rule 227 says that a competent authority may transfer a railway servant from one post to another, provided that except (i) on account of inefficiency or misbehaviour, or (ii) on his written request. Rule 232 says when a railway servant is transferred otherwise than for public convenience, a copy of the order of transfer shall be sent to the Accounts officer with the endorsement stating the reasons of the transfer. In the absence of such an endorsement the Accounts Officer shall assume that the railway servant has been transferred for the public convenience. Admittedly, in the impugned order there is no such indication. Therefore the clear cut indication is the transfer of the applicant had been done in public interest.

Rule 233 states that unless for special reasons ( which must be of public nature ) the authority under whose orders the transfer takes place permits or requires it to be made in any particular case elsewhere, or otherwise, the charge of an office must be made over at its headquarters, both the relieving and relieved railway servants being present. Apparently, the railway authorities had indicated that charge shall be handed over on 5th or 6th of the concerned month. On the said date the applicant had approached this Tribunal and this Tribunal had passed an interim order of status quo. The said order was produced by the applicant before the authorities on the 7th; but it was reported that on 6th of the month the authorities have decided that transferred person shall assume the charge in place of the applicant. Therefore, I am of the considered opinion there is no justiciability in the order. It is not clear as to what the proportionality and what is the subjective discretion which had prompted the transfer of the applicant. What is the public interest involved in the impugned order. Therefore, there is no option for this Tribunal other than to hold that the order of transfer is vitiated by extraneous considerations, vitiated by malafides and without sound foundational background. These are questions that would emerge from consideration of this transfer. It is to be noticed that in this connection the respondents have not raised any case of prejudicial element to allege against the applicant. They have offered no comments on the specific nature of

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allegations raised by him. They are relying on the extent of power in their possession and that the unchallengeabliity of their power should see them through. The implicit public interest in transfer is not yet disclosed. They have merely stated that they have concluded that the usefulness of the applicant at that station to be over. But the specific nature of allegations raised by the applicant and the reliability thereof had caused the said power to be vitiated by self interest, malice and malafides.

The reply is silent on the aspect of on what grounds the discretionary power had been exercised. The authorities have placed reliance only on the extent of their discretionary power to transfer and that the responsible subordinate officer has to accept the same without challenging it .

Under the Wednesbury principle the Court is entitled to investigate the action of the local authority with a view to seeing whether they have taken into account matter which they ought not to take into account, or conversely they have refused to take into account or neglected to take into account matters which they ought to take into account. As reported in [1948] K.B. 229

Relying on Art. 22 the Supreme Court ruled that the ground of detention must be communicated to the detainee in their entirety. If there are any documents, statements or other material relied on in the grounds of detention they must also be communicated as has been held by the Apex Court in Icchu Devi vs. UOI [ AIR 1980 SC 1983 1980 Indlaw SC 191]. The grounds so made known must be seem to be pertinent matters and should comprise all the constituent facts and materials that went into to make up the mind of the statutory functionary and not merely inferential conclusions. Therefore, the grounds so communicated must reveal the whole of the factual material considered by the detaining authority which the Apex Court had held in Shalini Soni vs. UOI [ AIR1981 SC 431 1980 Indlaw SC 283] In Saleh Muhammad vs. UOI [ AIR 1981 SC 111 1980 Indlaw SC 413], the Apex Court held that under Art. 22 (5) , a detainee is entitled to make representation and if there is unreasonable delay in considering such representation, it would have the effect of invalidating the detention.

It is seen that after transfer order was issued, the applicant seems to have filed a representation explaining the reasons as to why the transfer order should be rescinded. Even after the efflux of time, the same seems to have been not answered.

In any way, from an examination of all the details of the matter it is clear that the present transfer order is made under abuse of discretionary power, without any public purpose and with ulterior motive. For effective judicial control of abuse of powers it is necessary to distinguish between improper purpose and ulterior motives. It is found that the purpose of an administrative action is prescribed by law while motives relate to what prompts an administrator to do what is authorized by statute. An administrator might do what is ostensibly authorised by statute but he might be prompted by motives or considerations that are not pertinent to the authorised purpose. Thus in S.R. Venkataraman vs. uoi [ AIR 1979 SC 49 1978 Indlaw SC 251} the Hon’ble Apex Court held that where compulsory retirement of a civil servant was set aside the Supreme Court stated that if a discretionary

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order had been made for an unauthorized purpose it is generally unnecessary to inquire whether the administrator had also acted in good faith or in bad faith . In that case the Apex court did not find it necessary to examine the question of malice in view of the fact that the order had been made for an unauthorised purpose.

Admittedly, in this case two transfers were made in a course of an year or so. The transfer order which is impugned does not state any reason for the transfer and does not even state as to why the transfer is being made. The documents suggests that the transfer is made at the instance of second respondent, who was the principal generator and who was the then controller of the project from 2003 onwards. The applicant seems to have raised some objections and he submitted his assessment report opposing the alignment.. The proposal of the applicant was given a go by. Therefore prima facie the impugned order seems to be unauthorized as well.

The decision taken for unauthorized purpose is liable to be set aside. Merely because the power of transfer existed in one authority it does not mean that he can issue transfer order for an unauthorized purpose. It is crystal clear that the applicant and second respondent are not in good terms. The second respondent is the principal generator of the alignment of the project of national importance. If the realignment was not made the country could be losing more than Rs.3000/- crores is the claim of the applicant. Admittedly the second respondent on assuming the charge of Member Engineering called back the files from the Hon’ble Minister for Railways. Thereafter the complete picture was apparently not placed before the Hon’ble Minister for Railways for taking a decision which constitute violation of rules of Business. The same had happened during the interregnum period of change of Minister for Railways. Therefore it is crystal clear that the second respondent had malice actively in his mind against the applicant. The malice came to light because the second respondent suggested to the General Manager, to utilize the service of the applicant usefully elsewhere as coming from him it is an order to transfer. Naturally there is abuse of power in this. The railway Board issued the transfer order during the mid academic session without any useful purpose. It is clear from the records that extraneous reasons were there. In normal situations transfer must be left with the administrative authorities alone. But as rightly held by the Hon’ble Apex Court, if a transfer is vitiated by malafide or made under extraneous consideration or made by malice it must be interdicted as seems to be the case in this matter.

In view of the above discussions, it is the duty of the court to look into the transfer by taking into account the dictums of the Apex Court as quoted above. Therefore, I am holding that the transfer order dated 04.09.2009 stands vitiated and must be quashed. The Court should also see that the national interest and public interest should not suffer. Looking at from the other angle that prima facie if the suggestion of the applicant is put into operation the country can save Rs. 3,000/- crores. This is to be looked into seriously.

To Serve the nation better, a copy of this order must be made available to (i) the Cabinet Secretary, (ii) Comptroller and Auditor General of India and (iii) Chief Vigilance Commissioner, Central Vigilance Commission for them to look into the totality of this matter and to enable them to exercise their jurisdictional responsibilities.

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I conclude by declaring the impugned order of transfer dated 04.09.2009 passed against the applicant, as illegal, arbitrary and not on public interest, it is vitiated by malice and malafides and the same is hereby quashed. The respondents are directed to repost the applicant to the post, which he held on 04.09.2009, within two weeks from the date of receipt of a copy of this order with all consequences. As I have already found that on deeper inspection the relief from charge on 6th of the month is a colourable exercise of power, this reposting shall be as if such change of guard never occurred. In short, it shall be as if this illegality never occurred and he is entitled to all financial consequences of continued engagement at that post. The respondents are further directed to pay Rs. 5,000/- as costs to the applicant because of the sufferings caused to him not as quantified damages but as a palliative measure.

O.A stands allowed as above with costs of Rs.5,000/- to be paid to the applicant by the respondents.

The Registry is directed to forward a copy of this order to (1) the Cabinet Secretary, (2) Comptroller and Auditor General (3) Chief Vigilance Commissioner to enable them to exercise their jurisdictional responsibilities.

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Dewan Consultants and Private Limited v Union of India and Others5

1. Some people travel abroad for a holiday, some out of curiosity, others for the lust and good life and some in search of better job prospects and to improve their standard of living. 120 skilled and unskilled workers, aspiring to earn more for a better living and to improve their standard of life in this country ventured to the United States of America. An article appeared in the Hindustan Times dated 10.03.2008, highlighted the ill-treatment, poor accommodation, inhuman treatment and being overcharged, which resulted in a Show Cause Notice to this petitioner and thereafter cancellation of its registration

2. Taking into consideration the out flow of skilled and unskilled workers from India for employment purposes and ill-treatment meted out to some of the workers and further exploitation by recruiting agents, resulted in formation of a Legislation in the year 1983 known as "The Emigration Act, 1983 ". The aim and object of this country= was to regulate the terms and conditions of overseas employment and to grant protection and safeguards the interest of Indian workers going overseas for employment. Petitioner herein is a recruiting agent.

3. Aggrieved by the action of the respondents by virtue of which the licence of the petitioner was suspended and thereafter cancelled vide order dated 28.07.2008, the present petition has been filed.

4. The petitioner is a private company registered under the Companies Act, 1956 , and a registered recruiting agent initially functioning as Indian Overseas Tech Services. The petitioner company was established in the year 1978 and has been functioning as a recruiting agent for the last 30 years. The petitioner is stated to have an excellent reputation, goodwill and standing in this field. The registration certificate of the petitioner was suspended vide order dated 12.06.2005 and thereafter its registration was cancelled vide order dated 28.07.2008 by respondent no.2 (Office of the Protector General of Immigrants, through Ministry of Overseas Indian Affairs). It is this order of cancellation, which has been challenged by the petitioner and is a subject matter of the present writ petition.

5. The brief facts of the case as set out in the petition are that the petitioner is a registered recruiting agent. The licence of the petitioner was valid upto 29.10.2014. During the period of its functioning, no complaint was received against the petitioner or its predecessor, the proprietor-ship concern, for the last 30 years.

6. According to the petitioner, during this period the petitioner has assisted in the recruitment of several thousands of workers for various regions. On or about the year

5 Delhi High Court 3 November 2009 WP(C) No. 5794/2008 The Judgment was delivered by : HON'BLE JUSTICE G. S. SISTANI

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2005, there was a shortage of skilled workers in the Mississippi Region due to the devastation caused by Hurricane Katrina and hence there was an urgent need for recruiting foreign workers. One, Global Resources INC ("Global"), a company registered in Mississippi was in the business of assisting skilled foreign workers to find employment in the U.S.A. under temporary and permanent visa. Global was rendering these services for a fee to be paid by such foreign workers and it undertook as part of such fee to engage an Immigration Attorney to assist in the visa process.

7. Consequently on April 18, 2006, Global and one M/s Signal International (hereinafter referred to as "Signal") a company incorporated under the laws of Mississippi, U.S.A., entered into a Recruitment Agreement (hereinafter referred to as the "Agreement") where under the said Global agreed and undertook to:

i. Advertise, pre-test, select and qualify foreign workers suitable for employment by Signal;

ii. Provide all immigration documents and an Immigration Attorney free of cost to Signal (but at the cost of the workers) to assist and advise in the visa process for " H2B" t e mpor ary visa a nd / or th e "p er ma ne nt r esid en c e " process wherein Signal was liable only for the fees imposed by the US Central or State Governments;

iii. be responsible for transporting the foreign workers to the U.S.A. and from the U.S.A. back to their place of origin after expiry of their visas;

iv. provide housing, transportation, meals ("Accommodations") to the foreign workers upon payment of costs by the said foreign workers. In an amendment to the said Agreement on September 7, 2006, Signal has agreed to pay Global for three Meals to be provided by Global to the foreign workers on the terms set out in such amendment.

8. Subsequent to the execution of the above Agreement in 2006, since Global was not a registered agent in India as stipulated under the Act, Global approached the petitioner for recruiting 500 skilled workers - mostly welders and fitters for Signal's shipyard in Mississippi and Texas.

9. Signal also issued the Demand Letter and Power of Attorney in favour of the petitioner as required under the Act, which were duly attested by a Notary Public in the U.S.A. 10. In the said documents, it was mentioned that Signal required skilled foreign workers "on temporary and permanent employment visas". Based on the said documents and on the terms and conditions set out in the Agreement wherein it is stated that Signal would be procuring temporary and permanent visas for the foreign workers, the petitioner placed advertisements in leading newspapers for recruitment of skilled workers the jobs available with Signal.

11. The petitioner submits that as per a Government order (D.O. No.Z-11025/9/91 - Emig.) dated 01.08.1991, issued by the Ministry of Labour, Shram Shakti Bhawan, New Delhi, the Emigration Check Requirement Formalities for emigrants inter alia to North

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America has been suspended. Hence on and after 1991, no clearance is required from the office of the Protector of Emigrants for emigration to North America. The petitioner submits that a subsequent notification dated 28.12.2006 has reiterated the above.

12. The mandate given by Global to the petitioner was only to the extent of receiving the applications and documents from candidates and arranging for their interviews and tests to be conducted by both representatives of Global and Signal.

13. Accordingly, the petitioner arranged for interview dates for candidates and representatives from Signal and one Mr.Michael Pol of Global came to India in the month of June/July, 2006, and conducted the interviews and tests at Kerala, Vishakapatnam and Chennai. Signal conducted a written test for the Fitters and practical tests for the Welders. Signal representatives, Mr. Pol of Global and the company representatives present, then explained to the selected candidates (selected subject to results of their medical tests) all the terms and conditions of their employment with Signal. The workers were told at the time of their employment that they would be kept in bunkhouses due to large - scale devastation in the region due to Hurricane Katrina. Upon their acceptance of the said terms, the selected candidates also undertook their medical tests at various locations.

14. Signal and Global meanwhile had certain disputes and Signal therefore terminated the Agreement with Global by its letter dated November 29, 2006. Thereafter though the petitioner was initially engaged only by Global for assisting in the process of fixing interviews with workers and medical tests thereafter in India, Signal continued to use the services of the petitioner (only for facilitating the interviews and medical tests as abovementioned candidates).

15. Finally after further follow ups and completion of formalities by the Mr. Malvern Burnett, an Immigration Attorney appointed by Global, the workers left for the U.S.A. in batches from November, 2006, to January, 2007. There were no complaints whatsoever from the workers except in January, 2007, when the petitioner was informed about poor living conditions and poor food quality.

16. It is contended that though the responsibility for providing accommodations was that of Global, and the fact that there was no contractual obligation for the petitioner to provide any facilities or services after completion of the recruitment process, the petitioner's Managing Director, Mr. Sachin Dewan, personally visited Signal in January, 2007, and checked the food and accommodation provided. When the said Mr. Dewan found that the living conditions were cramped he took immediate action to rectify the same. Mr. Dewan also checked the other facilities, including the food provided and found that substantial and quality food was provided to the workers but that some of the workers were only complaining about their cuisine not being provided for (i.e. South Indian food, etc.). Mr. Dewan took pictures of the said facilities and food provided.

17. Counsel for the petitioner submits that due to the efforts of Mr. Dewan, Signal, promised to improve the living conditions, which Signal claimed were below par due to

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the after effect of Hurricane Katrina. Thereafter the petitioner received information from the workers that Signal had improved the working conditions around the month of May, 2007, and that the workers therefore had no further complaint about the same.

18. Further some of the workers recruited through the petitioner had also come to India on a vacation after May, 2007. During their trip some of the recruits contacted the petitioner but did not make any complaints whatsoever about living and food conditions at Signal. To the knowledge of the petitioner all the workers have been receiving their remuneration as agreed upon and all of them have made substantial amounts of money (nearly USD 75,000 - about Rs.30,00,000/-) from their employment with Signal. To the knowledge of the petitioner all those persons who had visited India for a vacation had returned to the U.S.A.

19. The petitioner further received information sometimes in February/March, 2007, that several of the workers recruited by the petitioner and stationed in Mississippi had absconded i.e. had left the Signal shipyard and had taken up work with other organizations where they could get more money than paid by Signal though they had arrived in the U.S.A. through visas sponsored by Signal, which amounts to a contravention of the conditions of the visas.

20. The petitioner further got information that Signal had filed for extension of visas as the workers had left India with H - 2B work visas, which were valid for a period of 10 months but that as of February - March, 2008, such extension of visas had not yet been received by Signal.

21. On March 10, 2008, the Hindustan Times, carried an article that about 100 workers who are working in Signal, recruited from India, had complained about the living conditions at Signal and had filed class action suit in the U.S.A. alleging human trafficking. It was also mentioned in the newspaper that several allegations were made against the petitioner including about the excess payments having been made to the tune of 8 to 10 lakhs on the promise of obtaining permanent visas for the workers but only temporary visas were given to the workers.

22. On the date, the Article appeared in the newspaper, respondent no.2 issued the first suspension order, suspending the certificate of registration of the petitioner, for a period of thirty days. Simultaneously, respondent no.3 also issued a show cause notice directing petitioner to file its reply on the suspension order issued by respondent no.2 within a period of fifteen days. According to the petitioner, no reasons were set out for issuance of the said first suspension order dated 10.03.2008 except that the Hindustan Times dated 10.03.2008 had carried an article. On account of the suspension notice, the business of the petitioner came to a standstill. Reply to the notice was sent on 17.03.2008. On 03.04.2008, respondent no.3 called upon the petitioner to submit originals of certain documents which were supplied by the petitioner. On 07.04.2008, the petitioner again received a letter from respondent no.3 asking for certain documents, the reply of which was sent by the petitioner on 09.04.2008.

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23. According to the petitioner, he has submitted all the documents pertaining to the recruitment of the workers of the Signal. On 07.04.2008, the petitioner received the second suspension order dated 03.04.2008 from the office of respondent no.2 extending the operation of suspension order dated 10.03.2008 till determination of question as to whether the registration of the petitioner should be cancelled and directed the petitioner to show cause within fifteen days of the receipt of the said second impugned suspension order.

24. As per the petitioner, apart from repeating the allegations verbatim from the first suspension order dated 10.03.2008 the only reason mentioned by respondent no.2 was that preliminary reports from CGI, Houston, had been received and according to which the workers were sent on Guest Workers Visa, which amounted to cheating of innocent immigrants and further the petitioner had not explained the question of payment of huge amounts made by the workers.

25. According to the petitioner, the second show cause notice was also untenable and amounted to holding the petitioner guilty based only on the allegations in a newspaper article and without any trial. The petitioner is stated to have sent a detailed reply dated 17.04.2008. On 08.04.2008, petitioner filed a reply against the suspension order no.1 dated 10.03.2008 as well as the second suspension order no.1 dated 03.04.2008.

26. On 21.04.2008, the petitioner received yet another show cause notice from respondent no.2 dated 15.04.2008, which according to the petitioner, had raised false, baseless and unsubstantiated allegations. Reply to this was sent on 24.06.2008. The petitioner was constraint to file a writ petition before this Court against issuance of multiple show cause notices. The High Court vide order dated 06.05.2008 directed the respondent to complete the enquiry within a period of one month from the date of its order. The appeal of the petitioner was heard on 06.06.2008 and finally rejected vide order dated 12.06.2008.

27. After passing of the order dated 06.05.2008 by the Delhi High Court, the petitioner issued a letter to respondent no.2 on 13.05.2008 requesting for prior intimation of the date of enquiry. The date for enquiry was fixed as 29.05.2008. Since the petitioner's Managing Director and his counsel were travelling, an adjournment was sought to 06.06.2008, which was granted. The petitioner vide letter dated 01.06.2008 requested respondent no.2 to furnish copies of documents and statements being relied upon by them in the enquiry. Such documents were only furnished to the petitioner on 06.06.2008. Meanwhile the appeal filed by the petitioner herein was rejected on 12.06.2008. Subsequent to the passing of the order in the appeal, respondent no.2 sent a letter dated 17.06.2008 to the petitioner directing the petitioner to produce the documents on 27.06.2008. Meanwhile the petitioner again requested respondent no.2 to furnish copies of documents and statements, if any, which the second respondent would be relying upon against the petitioner in the enquiry. The petitioner is stated to have produced all the documents on 27.06.2008, pertaining to Signal in its possession as requested by the second respondent during the hearing on 06.06.2008. Dissatisfied by the documents supplied, by an order dated 28.07.2008 respondent no.2 cancelled the registration

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certificate of the petitioner. The petitioner was served with a copy of the order dated 28.07.2008 on 31.07.2008.

28. Learned counsel submits that the petitioner was shocked to receive the order dated 28.07.2008 as he had repeatedly requested respondent no.2 to furnish all documents and statements which the second respondent wished to rely upon to ensure an effective hearing for the petitioner.

29. Learned counsel submits that the orders of suspension and cancellation order are arbitrary, contrary to the law and without following the principles of natural justice. By passing of the aforesaid orders, the respondents have deprived the petitioner of its right to conduct business and earn its livelihood.

30. Learned counsel contends that the respondents have relied on the material, statements and baseless allegations in cancelling the registration certificate of the petitioner. The petitioner has been deprived of its right to respond to the allegations contained in the cancellation order as the documents relied upon by respondent no.2 in the impugned cancellation order have not been furnished to the petitioner. It is also submitted that the second respondent has failed to furnish copies of the documents and statements relied upon by them and, thus, the petitioner has been deprived of an effective hearing. It has been strongly urged before this Court that the suspension orders and the show cause notices issued by respondent no.2 are based on newspaper reports according to which the petitioner has misled the workers by promising permanent visas and has charged them exorbitant amounts based on the said promise.

31. It is contended that the sole basis of the said accusations against the petitioner, as set out in the suspension orders and various show cause notices issued by respondent no.2 were the unsubstantiated allegations in the newspaper reports and a report from the Consulate General of India. Any orders passed on the sole basis of newspaper reports are contrary to the established principles of law.

32. Learned counsel has also submitted that while the petitioner produced all documents in its custody before respondent no.2, despite repeated requests, respondent no.2 failed to furnish copies of the documents and statements relied upon by them in deciding the matter against the petitioner.

33. Learned counsel submits that apart from the undated letter from Signal along with annexures which do not set out the basis for allegations, respondent no.2 did not furnish any other document or statement implicating the petitioner, at any point of time. Counsel further submits that the business and livelihood of all its employees have come to an abrupt standstill due to the illegal and arbitrary actions of the respondent.

34. It is submitted that the cancellation of the registration certificate of the petitioner for purported non-maintenance of certain records despite emigration to North America being exempted from the provisions of the Emigration Act , vitiates the impugned cancellation order. While the cancellation order has been passed for purported non- maintenance of

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records, however, no such show cause notice was issued on this ground. Further the action taken is arbitrary and excessive for non-maintenance of records particularly when emigration to North America is exempted from the provisions of the Emigration Act .

35. It is contended that the cancellation order is vague and baseless, as the respondents have failed to consider that the petitioner only acted as a facilitator for Signal to recruit the workers and had issued the advertisement as per the Demand Letter and Power of Attorney issued by the Signal. Thereafter Signal had arranged for an Immigration Attorney and the said attorney had also arranged for visas and all other formalities were carried out by the Attorney and Global. Based on the recruitment, the workers were provided gainful employment at Signal's shipyards. The workers have made substantial amounts of money, since their emigration to the USA, and the workers continued to work with Signal as they have got extension visas and the process for their permanent visas has also been commenced. Thus, none of the workers were either misled or cheated and that only some of the workers have raised false complaints for mala fide reasons.

36. Learned Additional Solicitor General appearing on behalf of the respondents submits that the present petition would not be maintainable in view of the fact that an appeal is provided under Section 23 of the Emigration Act, 1983 , against an order of cancellation. It is contended that the impugned order has been passed after following the due procedure and complying with the principles of natural justice and statutory provisions. Thus, the order of cancellation is not open to judicial review.

37. Learned Additional Solicitor General further submits that the petitioner has been given a show cause notice and a full- fledged enquiry was held after giving an opportunity of hearing in compliance with the principles of natural justice as well as the Emigration Act and Rules. It is submitted that there is adequate evidence on record to establish that the petitioner in complete violation of the Emigration Act, 1983 , has cheated and misled the poor prospective emigrant workers in collusion with Michael L. Pol of Global Resources.

38. It is contended that the petitioner/recruiting agency lacks the basic integrity and sensitivity that is required in recruiting agent's business dealings with prospective Indian emigrants as some of them may be only semi-literate or illiterate. It is further contended that despite several opportunities during the enquiry, the petitioner has failed to produce the evidence and complete record of recruitment and amounts charged in respect of the alleged misconduct.

39. Learned Additional Solicitor General submits that the petitioner has misrepresented that there are no complaints against him and petitioner has a clean record. In fact a complaint was received against the petitioner in the year 1997. It is disputed that the action has been taken against the petitioner only on the basis of some newspaper report. Since the petitioner did not comply with the various provision of the Emigration Act, 1983 and also did not behave responsibly and conscientiously in dealing with the poor emigrant workers who had placed their trust in him or their future prospects in foreign lands, the respondents were well within their rights to cancel the registration certificate.

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40. It is contended that the petitioner acted irresponsibly and showed scant regard to the welfare of the emigrant workers, luring them into his net with false promises of a Green Card/permanent residency which only the US Government can decide upon. In these circumstances, order of cancellation of registration certificate is fair and just. 41. It is further contended that a report was published in the Hindustan Times dated 10th March, 2008, that the petitioner/recruiting agency had recruited 120 Indian workers to work with M/s Signal International Company, Mississippi, USA, in two shipyards. It was further reported that the workers have paid huge amounts of money to the recruiting agency for their jobs in the company. The workers were promised good wages, decent accommodation, etc., however, they began facing a lot of problems upon their arrival. The workers were made to live in inhuman conditions without proper food and proper accommodation. The workers alleged, as reported, that the agents had also threatened to burn their passports.

42. Learned Additional Solicitor General submits that the matter was considered and upon enquiry it revealed that the recruiting agent, by way of charging huge amounts of money from the workers, which is more than the prescribed amount in the Emigration Rules , had sent the workers to a company where they were not provided with proper accommodation and food, and had cheated the innocent emigrants and also violated the terms and conditions of the registration certificate. Therefore, the recruiting agent (petitioner herein) is not fit to continue to hold the certificate and, thus, while suspending the certificate, vide order dated 10.03.2008, petitioner was asked to show cause within fifteen days of the receipt of the order as to why their registration certificate should not be suspended indefinitely/cancelled.

43. Learned Additional Solicitor General contends that no doubt the process of investigation was triggered off on the basis of the newspaper report, but the newspaper report by itself was not the only basis on which the orders were passed against the petitioner. Counsel for the respondent relies upon a preliminary report from the Consulate General of Indi (CGI), Houston, portion of which is reproduced below:-

"In order to meet the labour shortage after Hurricane Katrina which affected Lousiana and part of Mississippi in 2005, M/s Signal International, a marine fabrication company with headquarters at Pascagoula, Mississippi and yards at Orage/JPort Arthur, Texas, recruited, with the permission of the US Department of Labour, about 590 Indian workers, mostly welders and fitters and brought them to Mississippi and Texas in December, 2006 on guest worker visa (H2B visa programme) valid initially for 10 months, extendable at he descrition of the company and US authorities.

The recruitments were arranged through Global Resources Inc., Mississippi and M/s Dewan Consultants, Mumbai.

About 300 workers were deployed at the yard in Pascagoula, Mississippi and the remaining workers were deployed at the yard in Orange Country/Port Arthur, Texas.

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About 300 workers were deployed at the yard in Pascagoula, Mississippi and the remaining workers were deployed at the yard in Orange County/Port Arthur, Texas.

The workers, especially those deployed at Pascagoula, were not happy with the accommodation, food supplies etc. They alleged slave like working conditions and openly protested to the employers. They demanded better pay and amenities as well as permission to live outside the camp at cheaper accommodation of their choice in groups. Their grievances included poor group bunk house accommodation, deduction $35 per day towards accommodation, food, electricity, water etc., denial of permission to live outside at cheaper accommodation, provision for overtime hours and the refund of Rs.6 lakhs to 9 lakhs charged at the time of recruitment as commission by the recruiting firm in India promising long term employment/permanent residency/Green Card etc in the USA.

44. While it was admitted that neither the Indian workers nor M/s Signal International contacted the CGI, the CGI took up the matter with M/s Signal International and established contact with some of the workers. In the counter affidavit, as pointed out by the learned Additional Solicitor General, it has been stated that, subsequently, the company reduced the number of persons in each bunker accommodation, improved the quality and choice of food and also increased the salary from $18 to $19.5 per hour. In a letter from M/s Signal International addressed to the Indian Ambassador in Washington the company stated that they had terminated contract with M/s Global Resources when they came to know of its underhand dealings, overcharging the workers.

45. Learned Additional Solicitor General contends that while the workers were sent on "Guest Worker Visa", which can nowhere be compared with the Green Card and that the recruiting agent held out false promises of Green Card to the prospective emigrants. This amounted to cheating as the issue of Green Card is the prerogative of the US Government alone. Further the question of payment of huge amounts by the workers has not been explained anywhere by the recruiting agent.

46. Learned Additional Solicitor General submits that even as per the writ petition Signal had required skilled foreign workers on temporary and permanent employment visas. Nowhere had Signal promised Green Card to prospective Emigrants which the petitioner had offered in his advertisements. This according to the respondent is a willful act of misleading the prospective workers in order to extract huge sums of money from the poor prospective emigrants who would not be aware of the fact that Green Card can only be granted by the US Government. The workers have been made to pay between Rs.6.00 lakhs and above to the petitioner for processing their recruitment and Green Card. Copy of the advertisement published by the petitioner has been placed on record.

47. In support of his plea that the petitioner has been demanding large sum of money, over and above the amount as per the Emigration Act , petitioner has drawn the attention of the Court to a letter addressed by the petitioner to one Mr. Rajan Pazhambalkode dated 02.12.2006, wherein it has been stated that the company shall process the green Card and the Green Card process fee has been indicated. While in another letter dated 23.06.2008, Rs.66,700/- has been demanded in the name of Mr. Malvern C. Burnett; Rs.66,700/- has

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been demanded in the name of Mr. Micheal L. Pol; and balance sum of Rs.66,700/- has been demanded in the name of Dewan Consultants Pvt. Ltd. petitioner herein. This would show that the petitioner was misleading the prospective emigrants and it is wrong to suggest that the petitioner had no role to play in recruiting workers.

48. It is submitted that being a recruiting agent, it was sole responsibility of the petitioner to take care of the workers recruited by him. The petitioner by allowing the foreign companies' representatives to conduct the interviews and leaving all terms and conditions to such representatives by itself shows that he has not fulfilled the responsibilities as per the Emigration ActThe communication dated 23.06.2006 by itself would show that the petitioner demanded money from his foreign accomplices.

49. Learned Additional Solicitor General submits that the respondents have acted in a fair and just manner. Although the respondents were well within their right as per the provisions of Section 14 of the Emigration Act to straight away cancel the certificate of the petitioner, the respondents issued a show cause notice to the petitioner and after hearing the petitioner passed the impugned order.

50. In response to the submissions made by counsel for the respondent, learned counsel for the petitioner submits that mere availability of an alternate remedy of appeal under Section 23 of the Emigration Act does not affect the jurisdiction of the High Court to issue a writ, as in fact, the petitioner does not have efficacious alternate remedy.

51. Learned counsel contends that the Apex Court has consistently held that the existence of an alternate remedy does not operate as an absolute bar. The action of the respondents is illegal and without jurisdiction. The principles of natural justice and the petitioner's Fundamental Rights have been violated, in view of the fact that the respondents have failed to furnish all the documents relied upon by them in cancelling the registration certificate. Further the respondents have also produced and relied upon further additional documents before this court which were neither produced during the enquiry nor furnished to the petitioner. In support of the aforesaid submission, learned counsel relies upon Baburam Vs. Zilla Parishad, reported at AIR 1969, SC 556 and more particularly relied on para 3; A.V. Venkateshwaran Vs. R.S. Wadhwani, reported at AIR 1961 SC 1506 and more particularly relies on paras 8 and 10; Whirlpool Corporation Vs. Registrar of Trade Marks, Mumbai, reported at (1998) 8 SCC 1 and more particularly relies on paras 14 and 15; Popcorn Entertainment & Anr. Vs. City Industrial Development Corpn. & Anr., reported at (2007) 9 SCC 593 and more particularly relies on paras 22 and 47; Ram & Shyam Company Vs. State of Haryana & Ors., reported at (1985) 3 SCC 267 and more particularly relies on para 9; Harbanslal Sahnia & Anr. Vs. Indian Oil Corporation Ltd. & Ors., reported at (2003) 2 SCC 107 and more particularly para 7; Saci Allied Products Ltd., U.P. Vs. Commissioner of Central Excise, Merrut, reported at (2005) 7 SCC 159 and more particularly relies on paras 16 and 17; Chandra Singh & Ors. Vs. State of Rajasthan & Anr., reported at (2003) 6 SCC 545 and more particularly relies on para 37; and Mohinder Singh Gill & Anr. Vs. The Chief Election Commissioner, New Delhi & Other, reported at (1978) 1 SCC (405) and more particularly relies on para 8.

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52. Learned counsel for the petitioner also submits that the appeal would, in any case, be maintainable before the Secretary, who has already applied his mind and more so a joint counter affidavit has been filed by all the three respondents. Thus, the petitioner does not expect a fair decision, having regard to the fact that the availability of an alternate remedy does not create an absolute bar.

53. A preliminary objection was raised with regard to the maintainability of this writ petition on the ground that the petitioner has an alternate remedy under section 23 of the Immigration Act , by way of an appeal. Having heard learned counsel for the parties and the settled position of law that the existence of Statutory remedy does not operate as an absolute bar and further taking into consideration the observations of the Apex Court in the case of Whirlpool Corporation (Supra) where it has been held that alternate remedy would not operate as a bar at least in three contingencies: (1) where the writ petition seeks enforcement of any of the fundamental rights; (2) where there is violation of principles of natural justice; or (3) where the order or the proceedings are wholly without jurisdiction or the vires of an Act is challenged.

54. In this case the main thrust of the argument of the petitioner is with respect to the violation of the principles of natural justice and even otherwise, learned counsel for the petitioner had urged before this Court that the appeal would lie to the Secretary, who has been arrayed as respondent no.1 in the writ petition and all the respondents have filed a joint counter affidavit, thus it would be appropriate for this court to hear the matter.

55. No doubt the scope of the proceedings under Article 226 of the Constitution of India, 1950 would be narrow and limited to the extent of the order being unreasonable, illegal and the scope of interference would be narrow in comparison to the remedy of appeal. The disadvantage, if any, would be to the petitioner who has chosen to file the present petition. Thus I do not find force in the submission of counsel for the respondent that the present petition is not maintainable.

56. The impugned order has been challenged before this Court primarily on the ground that the respondents have failed to comply with the principles of natural justice. The cancellation order is vitiated as it refers to and relies on documents not furnished to the petitioner. The allegations against the petitioner are that the petitioner is not fit to carry on the business as a recruiting agent, as it has allegedly cheated and misled poor prospective emigrants with false promises of Green Cards, not provided them proper food and accommodation and has also charged excessive amounts from the workers.

57. It is contended that the petitioner has not violated any of the provisions of the Emigration Act and the workers were sent on H2B work visas and M/s Signal International has now applied for and is processing their applications for permanent visas for those workers who are still working with Signal. It is further contended that upon receipt of the complaint, the Managing Director of the petitioner had immediately gone in person to Signal's shipyard and ensured improvement in their accommodation, facilities and made arrangements for choice of food. While stating that this position has not been denied by the respondents, the petitioner has placed certain photographs on record, to

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show that the workers were staying in proper accommodation and proper food was being served to them. Learned counsel also contends that the conduct of the petitioner would show that they had every intention to see that the workers were comfortable and the aims and objects of the Act were fully complied with. It is next contended that the entire enquiry has been based on newspaper reports and not on the basis of any complaint by any individual worker. The allegation of excess payment is also based on hearsay through the newspaper reports and the report of the Consulate General of India is also not on the basis of the complaint of the workers. Even otherwise, in the absence of complete documents, the petitioner was not in a position to reply to the allegations.

58. It has been strongly urged that the extent of penalty and punishment meted out by the respondents to the petitioner by suspending the certificate of the petitioner on the same day, as the reports were published in the newspapers, and thereafter the impugned order dated 28.07.2008 is far in excess on the magnitude or gravity of the misconduct or violation, as alleged.

59. It is submitted that even the Act stipulates a bar of two years before a person may apply for registration if a cancellation order is passed. The petitioner has thus already suffered stoppage of its business and livelihood since 10.03.2008, besides the petitioner has a large number of employees, whose livelihood is also dependent upon the petitioner.

60. Leaned counsel has also contended that the respondents have filed material on record which was neither relied upon at the time of enquiry and passing of the impugned order nor copies were handed over to the petitioner and, thus, the respondents cannot better their own case by filing an additional affidavit. In support of this contention learned counsel for the petitioner relies upon (2003) 6 SCC 545, more particularly para 37.

61. Learned counsel for the petitioner submits that assuming the workers were unhappy with the accommodation or the food, these complaints were looked into by the Managing Director of the petitioner on his visit and admittedly the conditions were improved including that the wages were increased, thus, their grievances stood redressed. This fact is also borne out from the fact that the workers have neither returned back to India and those who have returned back, have neither approached the respondents, nor made any complaint against the petitioner.

62. I have heard the counsel for the parties, who have also taken me through the documents placed on record.

63. The first show cause notice was issued to the petitioner on 10.03.2008, relevant portion of which reads as under:-

"2. Whereas, a report has been published in the Hindustan Times dated 10th March, 2008 that the recruiting agent has recruited about 120 Indian workers to work with M/s Signal International Company, Mississippi, US in their two shipyards. It has been reported that the workers have paid huge amounts of money to the recruiting agent for their job in the company. While the workers were promised good wages, decent accommodation, etc.,

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they are now facing a lot of problems there. The workers are living in inhuman conditions without proper food. The workers have alleged, as reported, that the agents have threatened them to burn their passport.

3. Whereas the RA, by way of charging huge amounts of money from the workers for the job, which is more than that prescribed in the Emigration Rules, 1983 and sending the workers to a company where they are not provided proper accommodation and food, has cheated the innocent emigrants and also has violated the terms and conditions of the certificate. Therefore, the recruiting agent does not appear to be a fit person to continue to hold the certificate, having regard to the manner in which he has conducted the business of recruitment."

64. Reading of this show cause notice would show that based on the report of the Hindustan Times dated 10.03.2007, the petitioner was asked to show cause on four grounds i.e. (1) charging of huge amounts of money from the workers for the job, which is more than that prescribed in the Emigration Rules ; (2) sending workers to a company where they are not provided proper accommodation and food; (3) cheating innocent emigrants; and (4) violation of terms and conditions of the certificate.

65. The petitioner had sent a detailed reply vide communication dated 17.03.2008, in which while refuting all the allegations made in the show cause notice gave its explanation. Vide communication dated 03.04.2007, the petitioner was called upon to send all the relevant papers in connection with recruitment and subsequent deployment of Indian workers with M/s Signal International, in original. By a letter dated 04.04.2008, the petitioner submitted the original Power of Attorney dated 19.06.2006 issued by M/s Signal International, original Demand Letter dated 19.06.2006 issued by the Signal, original acknowledgment of conducting interview dated 23.06.2006 and four copies of the advertisements. The respondents again called upon the petitioner vide letter dated 07.04.2008 to provide the following documents:-

(a) Details on records of recruitment in connection with M/s Signal International. (b) Receipt books in connection with service charges issued to emigrants employed with M/s Signal International. (c) Advertisement released in newspapers along with bills. (d) Details of interviews and correspondence records kept in connection with recruitment following the advertisement. (e) Individual Employment Contract issued by the M/s Signal International. (f) Application letters mentioning terms and conditions of M/s Signal International issued to the emigrants.

66. In response to this communication, the petitioner vide letter dated 10.04.2007 furnished certain documents, however, with regard to the employment contracts, it was pointed out that the employment contracts were issued directly by M/s Signal International to the workers on their arrival in the USA, thus the petitioner was unable to produce the same. Similar response was made with regard to the application letters which contained terms and conditions of M/s Signal International and which were issued to the

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Emigrants. By an order dated 03.04.2008, another show cause notice was issued to the petitioner, the operative portion of which reads as under:-

3. Whereas the RA, by way of charging huge amounts of money from the workers for the job, which is more than that prescribed in the Emigration Rules, 1983 and sending the workers to a company where they are not provided proper accommodation and food, has created the innocent emigrants and also has violated the terms and conditions of the certificate. Therefore, the recruiting agent does not appear to be a fit person to continue to hold the certificate, having regard to the manner in which he has conducted the business of recruitment. Therefore the operation of the registration certificate of the recruiting agent was suspended vide order dated 10.03.2008 and the recruiting agent was asked to show cause within 15 days of the receipt of this order as to why their registration certificate should not be suspended indefinitely/cancelled.

4. The reply of the recruiting agent has been received. Preliminary reports from the CHI, Houston have also been received. It is observe d that the workers were se nt on 'guest worke r vi sa' . This amounts to cheating of innocent emigrants. Further the question of payment of huge amounts by the workers have not been explained by the recruiting agent. The matter is under consideration in consultation with the Embassy of India, Washington/CGI, Houston.

67. The show cause notice dated 03.04.2008 shows that the respondents had considered the preliminary reports received from the Consulat General of India, Houston. It was also observed that the workers were sent on 'Guest Workers Visa'. This order also notices the fact that the report has been received by the recruiting agency. Vide communication dated 17.04.2008, the petitioner sent a reply refuting all the allegations made against it. In this reply, the petitioner has stated that the entire proceedings have been initiated based on the newspaper reports, the order of suspension is bad in law, no steps were taken to verify the veracity of the allegations, the pre-emptory action had caused great prejudice and irreparable loss and adversely affected their business and livelihood. The petitioner had further stated that all necessary documents had been submitted to the respondents. The petitioner also stated that apart from the newspaper reports there was no basis for passing the suspension order. It was next stated that proper food and accommodation had been provided and the workers are earning a good livelihood. A complete reading of this reply would show that the petitioner did not address the allegation made against it with regard to payment of huge amounts by the workers.

68. Another show cause notice dated 15.04.2008 was sent to the petitioner, which was replied to on 26.04.2008. The impugned order, by virtue of which, the registration has been cancelled, notices the fact that based on the orders of the Delhi High Court dated 07.05.2008, the enquiry was to be concluded within a period of one month after affording a personal hearing to the petitioner. Admittedly, a personal hearing was granted to the petitioner. The petitioner was also called upon to furnish documents required to be maintained by them as per Rule 10 of the Emigrants Rule, 1983It has been noticed that the recruiting agency produced all the documents/records except the pre-paid tickets/advice, copies of employment contract of the emigrants, letters of interview,

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correspondence with emigrants and the original award sheets. The relevant portion of the order dated 28th July, 2008 is reproduced below:-

AND WHEREAS during the course of inquiry into the matter, the following facts have come to notice:

(i) References dated 8.3.2008, 10.3.2008, 28.5.2008 & 6.6. 2008 were received from Indian Mission abroad pointing out the complaints against the Recruiting Agents to the effect that the workers were being treated like slaves, poor accommodation and various inhumanly treatment being meted with them, excessive charging i.e. Rs.6 lakhs to Rs.9 lakhs, from the workers at the time of their recruitment as Commission by the recruiting firm in India and promising long term employment/permanent residency/Green Card in USA. It further revealed that on May 27th 2008 the workers informed the Indian Mission during their meeting with the Indian Ambassador that five of the works had been granted "U" category visas by US authorities since May, 2007. This visa category was created under the Victims of Trafficking and Violence Prevention Act, 2000 and was meant to be available to non-US citizens who had suffered abuse from criminal activities and are helpful for the investigation or prosecution of that crime (Since "U" visas have not yet been operationalsied, what the workers actually have is "U visa interim relief" with identical benefits. That the US authorities who are otherwise very stringent in the matter of issuing visas, have given the U category visas to five of the workers clearly indicates involvement of the Recruiting Agent, M/s Dewan Consultant with trafficking in the matter of deployment of these workers to the US.

(ii) The US Department of Justice has confirmed to the Indian Mission that they are undertaking a full investigation in the matter. The workers, on their part, have filed a lawsuit in the United States District Court for the Eastern District of Louisiana in whih M/s Dewan Consultant Pvt. Ltd. and Mr. Sachin Dewan, its Manging Director (A.K.A. Medtech Consultants) are parties.

(iii) Photocopies of drafts made out by the workers in the name of Mr. Malvern C. Burnett and Mr. Micheal L Pol, representatives of the US recruiters, and Dewan Consultants the Indian recruiter, are proof of Dewan Consultants charging the workers exorbitant amounts and also of the Recruiting Agent being a conduct or go-between for the conveyance of illegally charged amounts. There is also copy of a demand letter from Dewan Consultants to one of the prospective emigrants, Shri Bony V.S, asking DDs to be made out in the names of these three recruiters for an amount of Rs.66,700/- each which is extremely high and far in excess of what is provided in the Emigration Act /Rules 1983 as chargeable by a Recruiting Agent.

(iv) The Recruiting Agent, in their reply to the show cause notice dated 10.03.2007 has contended that the responsibility of the Recruiting Agent ceases after the emigrants reach their destination safely. This is not correct. The responsibility of the Recruiting Agent towards the emigrants is till the expiry of the contract against which the Recruiting Agent has recruited and deployed the workers for overseas employment.

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(v) Preliminary reports received from the CGI, Houston in March, 2008 supported the newspaper report of 10.3.2007. It was, inter alia, stated by the Indian Post that the recruitment for Signal International were arranged through Global Resources Inc., Mississippi and M/s Dewan Consultants, Mumbai. The CGI in its report has further stated that eventually on the intervention of the Post the company reduced the number of persons in each bunker accommodation, improved the quality and choice of food and increased the salary of the workers from US $ 18 in US $ 19.15 per hour. This is proof enough that the appalling state of affairs reported earlier was true and that the immediate action taken to suspend the RA's certificate was amply justified.

(vi) A letter from M/s Signal Internal, the US company, to the Indian Ambassador in Washington, a copy thereof received on 4.6.2008, categorically states "Global Resources recruited the workers through Mr. Sachin Dewan of M/s Dewan Consultants Pvt. Ltd., a registered Recruiting Agent, in Mumbai, India to interview and test the potential H-2B recipients. After the workers began to arrive in the United States, M/s Signal learned that both the recruiting agencies, M/s Global Resources and M/s Dewan Consultants had misled both M/s Signal International and had deceived the Indian workers during their recruitment in India by demanding highly excessive fees and making false promises about the green card process. No reason or justification is available on record to ignore the information received from M/s Signal International with whom event he Recruiting Agent has been carrying out the business.

(vii) On complaint of the POE, Mumbai, an FIR No.234/2008 dated 14.5.2008 u/s 420 IPC has been registered with PS Sakinaka, Mumbai against the Recruiting Agent M/s Dewan Consultants Pvt. Ltd., Mumbai.

(viii) During the proceedings dated 6.6.2008, it has been admitted that the Recruiting Agent has not maintained records regarding pre-paid tickets/advice, copy/record of employment contract of each emigrant, copy/record of letters of interview, correspondence with emigrants, original award sheets and the same clearly indicates violation of Rule 10(x) of Emigration Rules, 1983 .

(ix) The charging excessively towards the service charges by the Recruitment Agent clearly indicates violation of Rule 25.

AND WHEREAS I have considered the report of the Indian Mission abroad, report(s)submitted by POE, Mumbai coupled with registration of the aforesaid FIR, various documents and information on record and I am of the considered view that the said Recruiting Agent M/s Dewan Consultants Pvt. Ltd. lacks trustworthiness and has not carried out the business of the overseas recruitment in just and fair manner. In addition, it has violated the terms and conditions of the certificate enshrined under Rule 10 besides violating the provisions of Rule 25 of the Emigration Rules, 1983 and misrepresentation by issuing vague and misleading advertisements. The Recruiting Agent cannot wash out their responsibility about the well beings of the workers recruited for overseas employment by them once they are sent abroad as the same is in violation of the terms and conditions enshrined under Rule 10 of the Emigration Rules, 1983The contention of

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the Recruiting Agent that the PGE was not justified in passing the order of suspension only on the basis of newspaper report is not tenable inasmuch as in view of the gravity of the allegations against the Recruiting Agent, it was just and in the larger interest to suspend the operation of the certificate. It goes without saying that in their defence, the Recruiting Agent M/s Dewan Consultants Pvt. Ltd. has not been able to give any justification for not maintaining the records as required under Rule 10 of Emigration Rules, 1983 , for excessive charging than what has been prescribed under Rule 25 of the Emigration Rules, 1983 , for making misleading advertisements for temporary/permanent residency, Green Card in US. It is noted that suspension of operation of certificate cannot be termed to be penal. The newspaper report as such may not be conclusive proof of evidence as it is but at the same time there is no legal bar under the provision of Emigration Act, 1983 , that such reports coming to the notice of the PGE cannot be taken cognizance of for enquiring into the allegations against any particular Recruiting Agent. It is noted that the Emigration Act, 1983 is a Special Act enacted for a particular purpose as enshrined in the Act and to achieve the objective of the Act, pending confirmation of the veracity of the allegations finding place in the news reports, such news reports were found reasonable and no reason was found as to why such reports published in a national daily of repute cannot be relied upon for the limited purpose. It may be mentioned that such contention of the Recruiting Agent in this regard has been negated even by the ld. Appellate Authority in the order dated 12.6.2008.

69. It is well-settled that in proceedings under Article 226 of the Constitution of India, 1950 , the High Court cannot sit as a Court of appeal over the findings. The Apex Court has repeatedly held that the judicial review under Article 226 of the Constitution is not directed against the decision, but is confined to the decision making process.

70. In the case of Major Jai Gopal Srivastava (Retd.) V. Govt of NCT of Delhi & Ors. WP(C)No.2545/2008 this Court has held:

"It is trite law that natural justice is a procedural requirement of fairness before arriving at any decision. It is the duty of the authority who is to decide the matter that it must act in a fair and just manner to arrive at a decision. This can only be done after granting hearing to the party and an opportunity to state his case. Doctrine of natural justice has been extended to Statutory Authorities Tribunals exercising quasi judicial function and even to Administrative Authorities which determine the Civil Rights of obligations. In the case Canara Bank & Ors. Vs. Debasis Das and Ors. (2003) 4 SCC 557, the law relating to natural justice has been discussed in detail. It has been held as under:-

"13. Natural justice is another name for common-sense justice. Rules of natural justice are not codified canons. But they are principles ingrained into the conscience of man. Natural justice is the administration of justice in a common-sense liberal way. Justice is based substantially on natural ideals and human values. The administration of justice is to be freed from the narrow and restricted considerations which are usually associated with a formulated law involving linguistic technicalities and grammatical niceties. It is the substance of justice which has to determine its form.

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14. The expressions "natural justice" and "legal justice" do not present a watertight classification. It is the substance of justice which is to be secured by both, and whenever legal justice fails to achieve this solemn purpose, natural justice is called in aid of legal justice. Natural justice relieves legal justice from unnecessary technicality, grammatical pedantry or logical prevarication. It supplies the omissions of a formulated law. As Lord Buckmaster said, no form or procedure should ever be permitted to exclude the presentation of a litigant's defence.

15. The adherence to principles of natural justice as recognized by all civilized States is of supreme importance when a quasi-judicial body embarks on determining disputes between the parties, or any administrative action involving civil consequences is in issue. These principles are well settled. The first and foremost principle is what is commonly known as audi alteram partem rule. It says that no one should be condemned unheard. Notice is the first limb of this principle. It must be precise and unambiguous. It should apprise the party determinatively of the case he has to meet. Time given for the purpose should be adequate so as to enable him to make his representation. In the absence of a notice of the kind and such reasonable opportunity, the order passed becomes wholly vitiated. Thus, it is but essential that a party should be put on notice of the case before any adverse order is passed against him. This is one of the most important principles of natural justice. It is after all an approved rule of fair play..........."

71. Learned counsel for the petitioner has labored hard before this Court to show that all the relevant documents which were considered by the respondents against them and at arriving at the impugned decision were not made available despite repeated requests. On the other hand, it has been alleged by the respondents that neither satisfactory reply nor supporting documents have been furnished by the petitioner with regard to contracts entered into between the workers and the employers, the terms of recruitment and explanation with regard to overcharging. It is not in dispute that it is really the newspaper reports in the Hindustan Times dated 10.03.2008 which triggered off the investigation into the recruitment carried out by the petitioner for emigration of workers, the newspaper article acted as a whistle blower in the matter and not that merely on the basis of the newspaper report, the order of suspension or cancellation has been passed. If the entire action against the petitioner was based on the newspaper reports there would have been no occasion for the respondents to issue show cause notice to the petitioner or to call upon the petitioner to furnish necessary records. The mere fact that the cancellation order has been passed after issuing a show cause notice and taking into consideration the report received by the Consulate General of India and calling upon the petitioner to furnish necessary documents and the fact that a personal hearing was granted to the petitioner, I am satisfied that the order of cancellation is not merely on the basis of a newspaper report. The question whether the relevant documents were supplied to the petitioner or not can be appreciated in the light of the allegations against the petitioners. Show cause notice was issued to the petitioner on four grounds i.e. (1) charging of huge amounts of money from the workers for the job, which is more than that prescribed in the Emigration Rules ; (2) sending workers to a company where they are not provided proper accommodation and food; (3) cheating innocent emigrants; and (4) violation of terms and conditions of the certificate. Reading of the show cause notice would show that the

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petitioner was made aware as to the allegations against them by the workers. As far as the poor living conditions are concerned, the fact that the Managing Director of the petitioner visited the shipyard of Signal and thereafter the conditions had improved would show that there was force in this allegation. It would also show that the living conditions were not proper as well as the workers were charged in excess.

72. Under Article 226 of the Constitution of India, 1950 , the High Court is not empowered to interfere in the finding of a fact. In exercise of special jurisdiction the High Court does not act as a Court of Appeal and would interfere only when there is jurisdictional error apparent on the face of the record. (1980) 4 SCC 336

73. The aforesaid decision was also considered by the Supreme Court in the case of Dharamraj & Ors. Vs. Chhitan & Ors. (2006) 12 SCC 349. It would be useful to reproduce paras, 18, 19 and 20 of the same:

18. It is well-settled position of law by a catena of decisions of this Court that in the writ jurisdiction of the High Court, it is always permissible for it to correct the decision of the consolidation authorities or to declare the law on the basis of facts and proof of such facts. For this proposition, we may usefully refer to a decision of this Court in Mukunda Bore v. Bangshidhar Buragohain, (1980) 4 SCC 336 : 1982 SCC (Tax) 143 : AIR 1980 SC 1524 in which this Court indicated as to when the High Court can interfere with the orders of quasi- judicial authority. This observation may be quoted which is as follows: (SCC pp. 339-40, para 16)

"16. While on facts the order of the Board under appeal is not impeccable, we must remember that under Article 226 of the Constitution , a finding of fact of a domestic tribunal cannot be interfered with. The High Court in the exercise of its special jurisdiction does not act as a court of appeal. It interferes only when there is a jurisdictional error apparent on the face of the record committed by the domestic tribunal. Such is not the case here. It is true that a finding based on no evidence or purely on surmises and conjectures or which is manifestly against the basic principles of natural justice, may be said to suffer from an error of law. In the instant case, the finding of the Board that the appellant does not possess the necessary financial capacity, is largely a finding of fact. Under Rule 206(2) of the Assam Excise Rules, 1945 , an applicant for settlement of a shop is required to give full information regarding his financial capacity in the tender. Such information must include the details of sources of finance, cash in hand, bank balance, security assets, etc. Then, such information is verified by the inquiry officer." (underlining is ours)

19. In Syed Yakoob v. K.S. Radhakrishnan, (1964) 5 SCR 64 : AIR 1964 SC 477 this Court observed as follows: (SCR p. 65)

"... finding of fact cannot be challenged in ... a proceeding on the ground that the relevant and material evidence was insufficient to sustain the finding [and that] adequacy or sufficiency of evidence or an inference of fact to be drawn from the evidence or finding of fact are entirely within the jurisdiction of the Tribunal."

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20. Again in State of W.B. v. Atul Krishna Shaw, 1991 Supp (1) SCC 414 : AIR 1990 SC 2205 this Court held that if the quasi-judicial Tribunal had appreciated the evidence on record and recorded the findings of fact, those findings of fact would be binding on the High Court. By the process of judicial review, the High Court cannot appreciate the evidence and record its own findings of fact. If the findings are based on no evidence or based on conjectures or surmises and no reasonable man would on given facts and circumstances come to the conclusion reached by the quasi-judicial authority on the basis of the evidence on record, certainly the High Court would oversee whether the findings recorded by the authority is based on no evidence or beset with surmises or conjectures.

74. The Apex Court in the case of Tata Cellular Vs. UOI (1994) 6 SCC 651, had extensively dealt with the scope and power of judicial review and observed that:

"74. Judicial review is concerned with reviewing not the merits of the decision in support of which the application for judicial review is made, but the decision-making process itself.

75. In Chief Constable of the North Wales Police v. Evans23 Lord Brightman said : "Judicial review, as the words imply, is not an appeal from a decision, but a review of the manner in which the decision was made. * * * Judicial review is concerned, not with the decision, but with the decision-making process. Unless that restriction on the power of the court is observed, the court will in my view, under the guise of preventing the abuse of power, be itself guilty of usurping power."

In the same case Lord Hailsham commented on the purpose of the remedy by way of judicial review under RSC, Ord. 53 in the following terms :

"This remedy, vastly increased in extent, and rendered, over a long period in recent years, of infinitely more convenient access than that provided by the old prerogative writs and actions for a declaration, is intended to protect the individual against the abuse of power by a wide range of authorities, judicial, quasi-judicial, and, as would originally have been thought when I first practised at the Bar, administrative. It is not intended to take away from those authorities the powers and discretions properly vested in them by law and to substitute the courts as the bodies making the decisions. It is intended to see that the relevant authorities use their powers in a proper manner (p. 1160)."

In R. v. Panel on Take-overs and Mergers, ex p Datafin plc, (1987) 1 All ER 564, Sir John Donaldson, M.R. commented :

"An application for judicial review is not an appeal."

In Lonrho plc v. Secretary of State for Trade and Industry, (1989) 2 All ER 609 Lord Keith said:

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"Judicial review is a protection and not a weapon."

It is thus different from an appeal. When hearing an appeal the Court is concerned with the merits of the decision under appeal. In Amin, Re, 6 Amin v. Entry Clearance Officer, (1983) 2 All ER 864 Lord Fraser observed that :

"Judicial review is concerned not with the merits of a decision but with the manner in which the decision was made.... Judicial review is entirely different from an ordinary appeal. It is made effective by the court quashing the administrative decision without substituting its own decision, and is to be contrasted with an appeal where the appellate tribunal substitutes its own decision on the merits for that of the administrative officer."

76. In R. v. Panel on Take-overs and Mergers, ex p in Guinness plc, 27 (1990) 1 QB 146: (1989) 1 All ER 509 Lord Donaldson, M.R. referred to the judicial review jurisdiction as being supervisory or 'longstop' jurisdiction. Unless that restriction on the power of the court is observed, the court will, under the guise of preventing the abuse of power, be itself guilty of usurping power.

77. The duty of the court is to confine itself to the question of legality. Its concern should be :

1. Whether a decision-making authority exceeded its powers? 2. Committed an error of law, 3. committed a breach of the rules of natural justice, 4. reached a decision which no reasonable tribunal would have reached or, 5. abused its powers.

Therefore, it is not for the court to determine whether a particular policy or particular decision taken in the fulfilment of that policy is fair. It is only concerned with the manner in which those decisions have been taken. The extent of the duty to act fairly will vary from case to case. Shortly put, the grounds upon which an administrative action is subject to control by judicial review can be classified as under :

(i) Illegality : This means the decision-maker must understand correctly the law that regulates his decision- making power and must give effect to it. (ii) Irrationality, namely, Wednesbury unreasonableness. (iii) Procedural impropriety.

The above are only the broad grounds but it does not rule out addition of further grounds in course of time. As a matter of fact, in R. v. Secretary of State for the Home Department, ex Brind, (1991) 1 AC 696 Lord Diplock refers specifically to one development, namely, the possible recognition of the principle of proportionality. In all these cases the test to be adopted is that the court should, "consider whether something has gone wrong of a nature and degree which requires its intervention".

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78. What is this charming principle of Wednesbury unreasonableness? Is it a magical formula? In R. v. Askew, (1768) 4 Burr 2186 : 98 ER 139 Lord Mansfield considered the question whether mandamus should be granted against the College of Physicians. He expressed the relevant principles in two eloquent sentences. They gained greater value two centuries later :

"It is true, that the judgment and discretion of determining upon this skill, ability, learning and sufficiency to exercise and practise this profession is trusted to the College of Physicians and this Court will not take it from them, nor interrupt them in the due and proper exercise of it. But their conduct in the exercise of this trust thus committed to them ought to be fair, candid and unprejudiced; not arbitrary, capricious, or biased; much less, warped by resentment, or personal dislike."

79. To quote again, Michael Supperstone and James Goudie; in their work Judicial Review (1992 Edn.) it is observed at pp. 119 to 121 as under :

"The assertion of a claim to examine the reasonableness been done by a public authority inevitably led to differences of judicial opinion as to the circumstances in which the court should intervene. These differences of opinion were resolved in two landmark cases which confined the circumstances for intervention to narrow limits. In Kruse v. Johnson, (1898) 2 QB 91: (1895-9) All ER Rep 105 a specially constituted divisional court had to consider the validity of a bye-law made by a local authority. In the leading judgment of Lord Russell of Killowen, C.J., the approach to be adopted by the court was set out. Such bye-laws ought to be 'benevolently' interpreted, and credit ought to be given to those who have to administer them that they would be reasonably administered. They could be held invalid if unreasonable : Where for instance bye-laws were found to be partial and unequal in their operation as between different classes, if they were manifestly unjust, if they disclosed bad faith, or if they involved such oppressive or gratuitous interference with the rights of citizens as could find no justification in the minds of reasonable men. Lord Russell emphasised that a bye-law is not unreasonable just because particular judges might think it went further than was prudent or necessary or convenient.

In 1947 the Court of Appeal confirmed a similar approach for the review of executive discretion generally in Associated Provincial Picture Houses Ltd. v. Wednesbury Corpn, 31 (1948) 1 KB 223: (1947) 2 All ER 680. This case was concerned with a complaint by the owners of a cinema in Wednesbury that it was unreasonable of the local authority to licence performances on Sunday only subject to a condition that 'no children under the age of 15 years shall be admitted to any entertainment whether accompanied by an adult or not'. In an extempore judgment, Lord Greene, M.R. drew attention to the fact that the word 'unreasonable' had often been used in a sense which comprehended different grounds of review. (At p. 229, where it was said that the dismissal of a teacher for having red hair (cited by Warrington, L.J. in Short v. Poole Corpn., (1926) 1 Ch 66, 91: 1925 All ER Rep 74 as an example of a 'frivolous and foolish reason') was, in another sense, taking into consideration extraneous matters, and might be so unreasonable that it could almost be described as being done in bad faith; see also R. v. Tower Hamlets London Borough

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Council, ex p Chetnik Developments Ltd.33 (Chapter 4, p. 73, supra). He summarised the principles as follows:

'The Court is entitled to investigate the action of the local authority with a view to seeing whether or not they have taken into account matters which they ought not to have taken into account, or, conversely, have refused to take into account or neglected to take into account matter which they ought to take into account. Once that question is answered in favour of the local authority, it may still be possible to say that, although the local authority had kept within the four corners of the matters which they ought to consider, they have nevertheless come to a conclusion so unreasonable that no reasonable authority could ever have come to it. In such a case, again, I think the court can interfere. The power of the court to interfere in each case is not as an appellate authority to override a decision of the local authority, but as a judicial authority which is concerned, and concerned only, to see whether the local authority has contravened the law by acting in excess of the power which Parliament has confided in them.'

This summary by Lord Greene has been applied in countless subsequent cases.

"The modern statement of the principle is found in a passage in the speech of Lord Diplock in Council of Civil Service Unions v. Minister for Civil Service, (1985) 1 AC 374: (1984) 3 All ER 935: (1984) 3 WLR 1174

'By "irrationality" I mean what can now be succinctly referred to as "Wednesbury unreasonableness". (Associated Provincial Picture Houses Ltd. v. Wednesbury Corpn.) It applies to a decision which is so outrageous in its defiance of logic or of accepted moral standards that no sensible person who had applied his mind to the question to be decided could have arrived at.' "

80. At this stage, The Supreme Court Practice, 1993, Vol. 1, pp. 849-850, may be quoted :

"4. Wednesbury principle.- A decision of a public authority will be liable to be quashed or otherwise dealt with by an appropriate order in judicial review proceedings where the court concludes that the decision is such that no authority properly directing itself on the relevant law and acting reasonably could have reached it. (Associated Provincial Picture Houses Ltd. v. Wednesbury Corpn.31, per Lord Greene, M.R.)"

81. Two other facets of irrationality may be mentioned.

(1) It is open to the court to review the decision-maker's evaluation of the facts. The court will intervene where the facts taken as a whole could not logically warrant the conclusion of the decision-maker. If the weight of facts pointing to one course of action is overwhelming, then a decision the other way, cannot be upheld. Thus, in Emma Hotels Ltd. v. Secretary of State for Environment, (1980) 41 P & CR 255 the Secretary of State referred to a number of factors which led him to the conclusion that a non-resident's bar in a hotel was operated in such a way that the bar was not an incident of the hotel use for

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planning purposes, but constituted a separate use. The Divisional Court analysed the factors which led the Secretary of State to that conclusion and, having done so, set it aside. Donaldson, L.J. said that he could not see on what basis the Secretary of State had reached his conclusion.

(2) A decision would be regarded as unreasonable if it is impartial and unequal in its operation as between different classes. On this basis in R. v. Barnet London Borough Council, ex p Johnson, (1989) 88 LGR 73the condition imposed by a local authority prohibiting participation by those affiliated with political parties at events to be held in the authority's parks was struck down.

75. Applying the above principles to the facts of the present case it is to be considered whether the order dated 28.7.2008 is illegal or irrational and whether the decision making process was fair and just and also whether the respondents had complied with the principles of natural justice. Learned counsel had raised two issues with regard to non-compliance of the principles of natural justice. The first grievance of the petitioner is that documents relied upon by the respondents were not supplied to the petitioner and the respondents have filed documents along with their counter affidavit which were neither produced during the enquiry nor furnished to the petitioner but have been relied upon and filed along with the counter affidavit. The principles of natural justice are not embodied in a straightjacket formula (depend on the facts of each case and each case has to be decided on its own facts.)

76. Wade in his Administrative Law, 5th Edition at pages 472- 475 has observed that it is not possible to lay down rigid rules as to when the principles of natural justice are to apply.

77. In this case no doubt the articles appeared in the Newspaper "The Hindustan Times" which prompted the respondents to issue a show cause notice to the petitioner as well as pass an order suspending the certificate of the petitioner, but the time was also granted to the petitioner to file a response thereto. A second show cause notice was also issued and further time was granted and petitioner was also called upon to furnish documents. Petitioner was further called upon to file relevant documents vide communication 3.4.2007 and further detail was sought by a communication dated 7.4.2008. The grievance of the petitioner is that respondent had failed to supply documents which were relied upon by the respondents in cancelling the registration certificate and further respondent had relied upon additional documents filed along with counter affidavit. While according to the petitioner despite letters dated 1.6.2008 and 25.6.2008 the documents now filed along with the counter affidavit as R-1, R2, R-4 and R-6 were not supplied to them. The respondents during the course of hearing had disputed that the relevant documents were not supplied to the petitioner.

78. It was contended by counsel for respondent that the additional documents filed by the respondents with the counter affidavit were primarily in response to the writ petition, however, document relevant for the purpose of decision by the Protectorate of Immigrants were those referred to in the order of cancellation. Even otherwise, it was

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contended that documents filed as Annexures to the counter affidavit are letters written by the petitioner. One of the aims and purposes for issuing a show cause notice to a person is to enable the person to know as to what is to be answered and the precise grievance against such a person. Reading of both the show cause notices would show that the petitioner was served with a copy of the preliminary report which has been reproduced above. The petitioner was also served with a show cause notice pertaining to charging a huge amount of money, more than prescribed immigration Rules, 1983 , from the workers; sending the workers to a company where they were not provided proper accommodation and food thus violating the terms and conditions of the certifier. The second show cause notice while reiterating the above grounds had also included that the workers were sent on guest workers' visas. Petitioner was also called upon to produce various statutory records which were admittedly not maintained, but were required to be maintained under law. Further copies of the contact were also not available with the petitioner, as they were entered into by foreign recruited agencies as admitted by the petitioner at page 210 of the paper book. This receipt document was duly acknowledged by the petitioner. The same is reproduced below:

"The Emigration Rules, 1983 Rule 10 (ix)

 Requirement Status

(a) Register prescribed Maintained

(b)

Pre-paid ticket/Advice Not maintained

(c) Prescribed expenses Register Maintained

(d)

Employer folder Maintained

(e) Emigrant bio-data Maintained

(f) Employment Contract of each immigrant

No copies maintained (offer of employer-copy is there)

(g)

Original demand letter, Power of attorney

Available.

(h)

Advertisements Original (submitted to POE).

  Letters of interview No

  Correspondence with emigrant No

  Original award sheets No

  Persons involved in selection process

Yes, name & address Available.

(i) Register of Visas Maintained

ix) Monthly return (Form -IV) 490 sent in 03 months -Nov., Dec. & Jan. (06-07) to check if submitted.

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xi) Copies of Advertisements Approved by POE

These statements about status of various requirements as per the Emigration Act / Rules are recorded during the hearing on 06.06.2008 in my office chamber at 11:00 AM.

(J. PANDA) Protector General of Emigrants 06.06.2008 Saleem Dewan A.Singh for R.N. Singh. Central Govt. Counsel"

79. Learned counsel for the respondent has also drawn attention of the Court to a communication dated 26.6.2008 addressed to the petitioner by the respondent wherein certain things were pointed out. Communication dated 26.6.2008 reads as under:

To, Shri Sachin Dewan, Managing Director, Dewan Consultants Pvt. Ltd., B-708, Sagar Tech Plaza, Sakinaka Junction, Andheri (E) Mumbai-110 072 Fax: 022-2851 2312. "June 26, 2008 Subject : Inquiry & Personal Hearing on 27.06.2008 - Reg. Sir,

I am directed to refer to your fax letter dated 25.06.2008 on the subject cited above. During the hearing on 6.6.2008 in the chamber of the Protector General of Emigrants, you have already taken copy of the list of documents required, which has been signed by you. Further a copy of the Embassy letter was also given to you and your legal counsel has also put it in writing, copy of which is enclosed herewith. As such it is improper on your part to request seeking any further copies and you should come prepared on 27th June, 2008 with all the documents to conclude the enquiry on 27th. You may take note that no further opportunity will be given to you. Yours faithfully,

(G.KUMAR) Under Secretary to the Govt. of India. Encl: As above."

80. Learned counsel for the respondent has also relied upon a letter written by the petitioner dated 6.6.2008, acknowledging receipt of letter of June, 2008 along with several Annexures while seeking time as their advocate would need instructions from the company. It is stated that two show cause notices were issued, the petitioners were granted time to file their reply, the respondent had called upon the petitioner to furnish documents, and on the own showing of the petitioner complete documents were not supplied as stated by them in the format under Rule 19 (ix) of the Immigration Rules, 1983 .

81. As per rule 10 of the Immigration Rules, 1983 which are quoted below, petitioner was to comply with the terms and conditions:

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"10. Terms and conditions of the certificate - (1) The registration certificate shall be subject to the following terms and conditions

(i) This certificate shall be valid for a period specified in the certificate: (ii) the certificate shall not be transferable; (iii) the holder of the certificate shall conduct the business under his own hand and seal; (iv) a photocopy of registration certificate shall be displayed prominently at a conspicuously place of business; (v) the certificate shall be made available for inspection to the emigration authorities, law enforcement authorities and employers; (vi) the certificate shall be produced on demand for satisfaction of the bona fides of the recruiting agent, when such demand is made by an emigrant; (vii) the holder of the certificate shall conduct the business from the place indicated in certificate. For opening a recruitment centre at a place other than the place indicated in the certificate, the holder of the certificate shall obtain the prior permission of the registering authority or an officer specially authorised by the registering authority; (viii) the holder of the certificate shall not employ sub-agents for the purpose of conducting or carrying on his business, and (ix) the holder of the certificate shall maintain the following records at his place of business and shall make them available for inspection on demand by Protector General of Emigrants or the Protector of Emigrants, -

(a) a register of receipt of charges from emigrants recruited, in the form of an original acquittance roll containing the signature of each emigrant from whom the charge has been received. Each such register shall be with reference to a demand for recruitment. The register shall be maintained as permanent records; (b) a register and records of the amount and Pre-paid Ticket Advices along with their photo copies received from the employers, identified demand wise; (c) a register containing details of expenses incurred on the recruitment of emigrants demand wise supported by the documents; (d) individual folders for each employer whose demands of labour, the holder of the certificate has processed, proposes to process or is processing; (e) bio-data of each emigrant recruited by the holder of the certificate; (f) copies of employment contracts of each emigrant as authenticated by the Protector of Emigrants; (g) original demand letter, power of attorney and correspondence with the employers; (h) all documents relating to the recruitment of emigrants, including office copies of all advertisements issued, letters of interview and correspondence with the applicants, original award sheets leading to the selection, names and addresses of persons involved in the selection process, copies of letters of appointments, trade-testing particulars; (i) a register of visas received from the employers, giving separate account of block and individual visas; (j) a register of claims for all compensation, (including for injury or death) made by the emigrants or their dependents, recruited by the holder of the certificate giving the name, address of the emigrant, emigration number, country of employment, nature of

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compensation (including the details in regard to the circumstances leading to the claim), address of the recipients and the name and address of the employer, and the receipt in original in token of having made the payment of compensation; and (k) such other records as may be required to be maintained by the registering authority. (x) the holder of certificate shall file a return every month in Form IV to the Protector General of Emigrants or the Protector of Emigrants specified by the Protector General in this behalf, by the 10th of the succeeding month; (xi) Copy of each advertisement for recruitment of the emigrants shall be endorsed to the Protector of Emigrants; (xii) the holder of the certificate shall ensure that the employer observes the terms and conditions of the contracts ; and (xiii) the holder of the certificate shall not charge any amount from the emigrant towards the repatriation expenses.

(2) The Certificate shall be in Form V."

82. As already observed in proceedings under Article 226 of the Constitution of India, 1950 , this Court is not a Court of Appeal and is not concerned with the decision but with the decision making process. Taking into consideration that the petitioner was issued two show cause notices, granted opportunity to the petitioner to respond, it cannot be said that the principles of natural justice were flouted. Taking into consideration the material placed on record, prima facie, I am of the view that material documents were supplied to the petitioner. Even otherwise, on careful reading of the show cause notices and the order passed, it cannot be said that petitioner was not aware of the grounds on which the show cause notice was issued or that petitioner was put to any disadvantage or any prejudice was caused to the rights of the petitioner. Although the respondents would have been well within their rights as per the provisions of Section 14 of the Immigration Act to cancel the licence of the petitioner without issuing any show cause notice, however, the respondents, acting in a fair and just manner by issuing show cause notices and then only passed order of cancellation, hence respondents have not violated the principles of natural justice. According to the impugned order, the petitioner had not maintained the records regarding pre-paid tickets as advised, copy of the record of the employment of each immigrants, copy /letters of interview and correspondence with Immigrants/ original.

83. Having held that there is no infirmity in the order dated 28.7.2008, the only question left for consideration before the court is with regard to the submissions made by counsel for the petitioner that the punishment imposed upon the petitioner is not commensurate with the gravity of the misconduct and the cancellation of the registration is disproportionate to the gravity of the misconduct. In this case once the petitioner learnt about the ill-treatment being melted out to the workman and even prior to the issuing of the show cause notice, admittedly, the Managing Director of the petitioner had visited the office of M/s.Singhal where the workmen had been employed. Even the report received by the Consulate General of India has observed that the employer had improved the conditions of stay and other amenities to the workers. Besides one complaint which has been brought to the notice of the Court which also pertains to the year 1997. The respondents have not been able to show any other complaint pertaining to the petitioner,

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during the entire period of 30 years of its carrying on the business of recruiting workers. While drawing the attention of the Court to Section 14(6) of the Act, according to which where a certificate has been cancelled, the person shall not be eligible to make any application for certificate until the expiry of the period of two years from the date of cancellation, learned counsel for the petitioner submitted that the business of the petitioner stands suspended since 10.3.2008, to meet the ends of justice, the punishment should be limited to the period already undergone. It may be observed that the question and the quantum of punishment is a matter which is primarily in the domain of the authority, who passes the order. The Apex Court, has also observed that the High Court while exercising its power of judicial review, should normally not substitute its own conclusions on the penalty or the punishment imposed.

84. Both counsel for the petitioner as well as for the respondent had submitted that having regard to the facts and circumstances of this case, should the Court come to the conclusion that the punishment imposed on the petitioner was not commensurate with the gravity of the misconduct rather than remanding the matter back. This Court should keep in view the facts and circumstances of the case and consider such penalty as deemed fit and appropriate. In the case of B.C. Chaturvedi Vs. UOI AIR 1996 SC, the Apex Court has held that the High Court would be within its jurisdiction to modify the punishment/ penalty by moulding the relief, which power the Court undoubtedly has when the punishment /penalty awarded shocks the judicial conscience of the Court. Similar view has also been expressed by the Apex Court in the case of Rajnit Thakur Vs. UOI 1982 (2) SCC 611.

85. In the case in hand the first order of suspension was passed as far back as on 10.3.2008 and the order of cancellation was passed on 27.8.2009. According to Section 14(6) of the Act, a person is not permitted to apply for another certificate until the expiry of the period of two years from the date of cancellation.

86. In the light of above, it is to be considered whether the action taken by the respondent is in excess and not commensurate with the gravity of the offence and whether the petitioner would be entitled to apply for a fresh certificate two years after 27.8.2009, while certificate stands suspended from 10.3.2008.

87. Taking into consideration the fact that till date no complaint or any action - Civil or Criminal - has been initiated by any of the workers against the petitioner, the order of cancellation would not commensurate with the gravity of the misconduct more particularly for non-maintenance of the records. The entire business of the petitioner has come to a standstill since 10.03.2008. Accordingly, the 20punishment awarded to the petitioner stands modified to the extent that petitioner shall be permitted to resume its business only after 10.11.2009, which would amount to suspension of work for a period of one year and eight months from the first suspension order i.e. 10.3.2008.

88. Petition stands disposed in above terms.

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Khanapuram Gandaiah v Administrative Officer and Others6

1. This special leave petition has been filed against the judgment and order dated 24.4.2009 passed in Writ Petition No.28810 of 2008 by the High Court of Andhra Pradesh by which the writ petition against the order of dismissal of the petitioner's application and successive appeals under the Right to Information Act, 2005 (hereinafter called the "RTI Act") has been dismissed. In the said petition, the direction was sought by the Petitioner to the Respondent No.1 to provide information as asked by him vide his application dated 15.11.2006 from the Respondent No.4 - a Judicial Officer as for what reasons, the Respondent No.4 had decided his Miscellaneous Appeal dishonestly.

2. The facts and circumstances giving rise to this case are, that the petitioner claimed to be in exclusive possession of the land in respect of which civil suit No.854 of 2002 was filed before Additional Civil Judge, Ranga Reddy District praying for perpetual injunction by Dr. Mallikarjina Rao against the petitioner and another, from entering into the suit land. Application filed for interim relief in the said suit stood dismissed. Being aggrieved, the plaintiff therein preferred CMA No.185 of 2002 and the same was also dismissed. Two other suits were filed in respect of the same property impleading the Petitioner also as the defendant. In one of the suits i.e. O.S. No.875 of 2003, the Trial Court granted temporary injunction against the Petitioner. Being aggrieved, Petitioner preferred the CMA No.67 of 2005, which was dismissed by the Appellate Court - Respondent No.4 vide order dated 10.8.2006.

3. Petitioner filed an application dated 15.11.2006 under Section 6 of the RTI Act before the Administrative Officer-cum-Assistant State Public Information Officer (respondent no.1) seeking information to the queries mentioned therein. The said application was rejected vide order dated 23.11.2006 and an appeal against the said order was also dismissed vide order dated 20.1.2007. Second Appeal against the said order was also dismissed by the Andhra Pradesh State Information Commission vide order dated 20.11.2007. The petitioner challenged the said order before the High Court, seeking a direction to the Respondent No.1 to furnish the information as under what circumstances the Respondent No.4 had passed the Judicial Order dismissing the appeal against the interim relief granted by the Trial Court. The Respondent No.4 had been impleaded as respondent by name. The Writ Petition had been dismissed by the High Court on the grounds that the information sought by the petitioner cannot be asked for under the RTI Act. Thus, the application was not maintainable. More so, the judicial officers are protected by the Judicial Officers' Protection Act, 1850 (hereinafter called the "Act 1850"). Hence, this petition.

4. Mr. V. Kanagaraj, learned Senior Counsel appearing for the petitioner has submitted that right to information is a fundamental right of every citizen. The RTI Act does not provide for any special protection to the Judges, thus petitioner has a right to know the

6 Supreme Court of India 4 January 2010 Special Leave Petition (Civil) No. 34868 of 2009

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reasons as to how the Respondent No. 4 has decided his appeal in a particular manner. Therefore, the application filed by the petitioner was maintainable. Rejection of the application by the Respondent No. 1 and Appellate authorities rendered the petitioner remediless. Petitioner vide application dated 15.11.2006 had asked as under what circumstances the Respondent No.4 ignored the written arguments and additional written arguments, as the ignorance of the same tantamount to judicial dishonesty, the Respondent No.4 omitted to examine the fabricated documents filed by the plaintiff; and for what reason the respondent no.4 omitted to examine the documents filed by the petitioner. Similar information had been sought on other points.

5. At the outset, it must be noted that the petitioner has not challenged the order passed by the Respondent No. 4. Instead, he had filed the application under Section 6 of the RTI Act to know why and for what reasons Respondent No. 4 had come to a particular conclusion which was against the petitioner. The nature of the questions posed in the application was to the effect why and for what reason Respondent No. 4 omitted to examine certain documents and why he came to such a conclusion. Altogether, the petitioner had sought answers for about ten questions raised in his application and most of the questions were to the effect as to why Respondent No. 4 had ignored certain documents and why he had not taken note of certain arguments advanced by the petitioner's counsel.

6. Under the RTI Act "information" is defined under Section 2(f) which provides:

"information" means any material in any form, including records, documents, memos, e-mails, opinions, advices, press releases, circulars, orders, logbooks, contracts, report, papers, samples, models, data material held in any electronic form and information relating to any private body which can be accessed by a public authority under any other law for the time being in force."

This definition shows that an applicant under Section 6 of the RTI Act can get any information which is already in existence and accessible to the public authority under law. Of course, under the RTI Act an applicant is entitled to get copy of the opinions, advices, circulars, orders, etc., but he cannot ask for any information as to why such opinions, advices, circulars, orders, etc. have been passed, especially in matters pertaining to judicial decisions. A judge speaks through his judgments or orders passed by him. If any party feels aggrieved by the order/judgment passed by a judge, the remedy available to such a party is either to challenge the same by way of appeal or by revision or any other legally permissible mode. No litigant can be allowed to seek information as to why and for what reasons the judge had come to a particular decision or conclusion. A judge is not bound to explain later on for what reasons he had come to such a conclusion.

7. Moreover, in the instant case, the petitioner submitted his application under Section 6 of the RTI Act before the Administrative Officer-cum- Assistant State Public Information Officer seeking information in respect of the questions raised in his application. However, the Public Information Officer is not supposed to have any material which is not before him; or any information he could have obtained under law. Under Section 6 of

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the RTI Act, an applicant is entitled to get only such information which can be accessed by the "public authority" under any other law for the time being in force. The answers sought by the petitioner in the application could not have been with the public authority nor could he have had access to this information and Respondent No. 4 was not obliged to give any reasons as to why he had taken such a decision in the matter which was before him. A judge cannot be expected to give reasons other than those that have been enumerated in the judgment or order. The application filed by the petitioner before the public authority is per se illegal and unwarranted. A judicial officer is entitled to get protection and the object of the same is not to protect malicious or corrupt judges, but to protect the public from the dangers to which the administration of justice would be exposed if the concerned judicial officers were subject to inquiry as to malice, or to litigation with those whom their decisions might offend. If anything is done contrary to this, it would certainly affect the independence of the judiciary. A judge should be free to make independent decisions.

8. As the petitioner has misused the provisions of the RTI Act, the High Court had rightly dismissed the writ petition.

9. In view of the above, the Special Leave Petition is dismissed accordingly.

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Biecco Lawrie Limited and Another v State of West Bengal and Another7

1. The judgment and order dated 30th of September, 2005 passed by a Division Bench of the Calcutta High Court affirming the judgment and order dated 4th of October, 2004 of a learned Judge of the same High Court and the order dated 31st of October, 2003 of the Vth Industrial Tribunal, West Bengal is under challenge before us at the instance of Biecco Lawrie Ltd. and another, the appellants herein.

2. By the order of Vth Industrial Tribunal, West Bengal, dated 31st of October, 2003, the order of dismissal passed by the appellants against Provash Chandra Mondal - respondent No.2 [hereinafter referred to as the 'respondent'] was set aside.

3. The respondent was appointed as general mazdoor in the Switch Gear works of the appellants and his duty, inter alia, was to bring materials from the shop rack to the working benches and afterwards to take them to their respective racks. On 4th of August 1984, a charge sheet was issued against the respondent on charges of major misconduct, namely, instigation, insubordination and using of abusive and filthy languages against his superiors and dilatory tactics, which are major misdemeanor in terms of Section "L" Appendix "D" of the certified standing orders of the appellant- Company, which are reproduced below:Appendix "D" Clause (2) Major Misdemeanor

(i) Willful insubordination or disobedience of any lawful and reasonable order of a superior,(iv) Willful slowing down in performance of work(xi) Commission of any act subversive of good behavior or of the discipline of the company(xxix) Instigation, incitement, abetment or furtherance of the forgoing punishable as major misdemeanor

4. By the charge sheet, the respondent was called upon to submit his explanation and he was suspended from service with payment of subsistence allowance pending inquiry. The respondent filed his written explanation on 6th of August, 1984 to the charge sheet which being found unsatisfactory, an inquiry committee was constituted with Mr. P.K.Mukherjee (the company lawyer) as the Inquiry Officer who submitted his report on 29th of August, 1985 following domestic inquiry and held that the respondent was guilty of major misconduct. Accordingly, relying upon the inquiry report, the respondent was dismissed from service. The respondent through a letter dated 22nd of November, 1985 admitted all the charges and sought condonation and mercy attributing his acts to his mental illness which was not considered by the appellants on account that the respondent was on earlier occasion also charged with similar grounds and was given a chance to

7 Supreme Court of India 28 July 2009 Civil Appeal No. 245 of 2007 The Judgment was delivered by : HON'BLE JUSTICE TARUN CHATTERJEE

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amend his conduct. It was alleged by the appellants that the respondent had developed a habit of misconducting himself in an undesirable manner despite opportunities being given to rectify his conduct.

5. Subsequent to this, the dispute was referred under Section 7A of the Industrial Disputes Act, 1947 on 2nd of April, 1987 by the Labour Department, Government of West Bengal to the Vth Industrial Tribunal, West Bengal for adjudication. Both the parties filed their written statements presenting their cases before the Tribunal and on 9th of October, 1990 the Tribunal held that the inquiry conducted by Mr. P. K. Mukheree, the Inquiry Officer, was in violation of the principles of natural justice and accordingly the matter was heard afresh on merits. The witnesses of the appellants were examined and cross examined. The respondent was also examined and cross examined. In course of examination of the witnesses of the appellants, a witness specifically mentioned the abusive and slang language used by the respondent which was recorded in vernacular. These witnesses were also examined by the respondent. The Vth Industrial Tribunal, on consideration of the Inquiry Report and evidence on record, affirmed the order of dismissal passed against the respondent and gave a reasoned order whereby it specifically found the charges leveled against the respondent deemed to have been proved and while doing so had also taken into consideration the prior conduct of the respondent. The respondent challenged the order of the Tribunal before the High Court by filing a writ petition and by an order dated 12th of October 1999, the order of the Tribunal was set aside and the matter was remitted back to the Tribunal for reconsideration on the basis of existing evidence but only with respect to charge no. 1, viz., disobedient in not carrying out the orders of his superiors.

6. Pursuant to the order of the High Court, after remand, the Vth Industrial Tribunal heard the matter on the basis of the same evidence on record and by an order dated 31st of October 2003 held that the respondent was illegally terminated by the appellants and the dismissal order was not justified and hence liable to be set aside. It also directed the reinstatement of the respondent with full back wages. The Tribunal held that the appellant had failed to establish by cogent evidence that the respondent had developed the habit of being negligent in his duties and using abusive language. It was further held that the charge sheet had not disclosed the specific abusive language used by the respondent and without recording such language, the charge sheet was bad.

7. The appellants subsequently challenged the aforesaid order of the Vth Industrial Tribunal by filing a writ petition before the High Court which was dismissed on 4th of October, 2004 without assigning any reasons of its own. It passed the order on the basis of the findings of the Tribunal and held that the court in exercise of its jurisdiction was not authorised to re-appreciate the findings of the Tribunal. Feeling aggrieved, the appellants preferred an appeal before a Division Bench of the High Court which also dismissed the same on 30th of September, 2005 affirming the order of the learned Single Judge on a finding that the charge sheet did not contain the specific materials in detail. Feeling aggrieved by the Order of the High Court, the appellants have filed these special leave petitions which, on grant of leave, were heard in the presence of the learned counsel for the parties.

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8. The pivotal questions that need to be considered by us are as follows:

a. Whether the principles of natural justice have been violated?b. Whether the dismissal is vitiated by the same and is thus bad and unjustified?c. Whether the tribunal was justified in reversing its own decision subsequently when there had been no further evidence adduced?d. Whether the High Court was right in their appreciation of evidence and exercising power in the matter of interfering with the order of dismissal?

9. We have heard the learned counsel for both the parties and also examined the impugned order of the Division Bench as well as the orders of the learned Single Judge of the High Court and also of the Industrial Tribunal setting aside the order of dismissal passed against the respondent and other materials on record including the orders passed by the High Court as well as the tribunal in earlier matters by which the High Court had sent back the case for re- hearing. At the first instance, the learned counsel for the appellants strongly argued that there was perversity and illegality involved in the decision rendered by the Tribunal which was affirmed by the High Court. It was also argued on behalf of the appellants that a fair and reasonable opportunity of hearing was afforded to the respondent and the charge sheet did not suffer any discrepancy as it sufficiently enabled the respondent to defend his case. Furthermore, it was contended that the charges framed were not vague or unintelligible and were serious cases of misconduct. It was further argued that the Tribunal and the High Court had appreciated the evidence wrongly and it would not be in the interest of appellant-company to keep a workman who has developed the habit of abusing superiors with filthy language and disobeying their orders. Accordingly, the learned counsel for the appellants prayed for setting aside the judgment of the High Court as well as of the Industrial Tribunal and restoration of the order of dismissal passed against the respondent.

10. Submissions made by the learned counsel for the appellants were strongly contested by the learned counsel appearing on behalf of the respondent.

11. The learned counsel for the respondent contended that the respondent was denied a fair hearing and was dismissed in violations of the principles of natural justice. It was argued on behalf of the respondent that the charge sheet did not contain the specific abusive language and thus it was difficult for him to defend his case. He further argued that the respondent was not furnished with the list of witnesses and copy of the documents to be treated as evidences and materials on which the management was to rely and he was also denied a chance of being represented by a lawyer or a representative who is equipped with legal background during the enquiry proceedings. Learned counsel for the respondent also contended that the appellants had not presented before the court any documentary evidence to prove that he had on earlier occasion misconducted himself and was thus in a habit of disobeying his superiors. The learned counsel also strongly argued that the work assigned to the respondent was not part of his duty as he was appointed to carry things from one place to another outside the shop and not to fix the top planks on the braker stand. Finally, the learned counsel for the respondent argued that since the

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concurrent findings of fact arrived at on the question formulated hereinabove, it is not open to this Court to exercise its discretionary power under Article 136 of the Constitution Of India, 1950 to interfere with the impugned order on such concurrent findings of fact.

12. Let us first delve into the most crucial question raised in this appeal, i.e. : whether there was violation of principle of natural justice. Principle of natural justice is attracted whenever a person suffers a civil consequence or a prejudice is caused to him by an administrative action. In other words principle of natural justice is attracted where there is some right which is likely to be affected by any act of the administration including a legitimate expectation.(See: Ashoka Smokeless Coal India (P) Ltd. v. Union of India & Ors.[(2007) 2 SCC 640] The procedure to be followed is not a matter of secondary importance and in the broadest sense natural justice simply indicates the sense of what is right and wrong (Voinet v. Barrett (1885) 55 LJQB 39) and even in its technical sense it is now often equated with fairness. As a well-defined concept, it comprises of two fundamental rules of fair procedure that- a man may not be a judge in his own cause (nemo judex in re sua) and that a man's defence must always be fairly heard. Judgments dealing with the administrative decisions proceed on the footing that the presence of bias means the tribunal is improperly constituted so that it has no power to determine or decide the case and accordingly its decision must be void and a nullity. Generally the courts pass a declaratory judgment stating that the award is a nullity and secondly they may send it back to the authority to decide the matter afresh. The instant case might appear to be a case of departmental bias as it is persistently lodged by the respondent that the Enquiry Officer was biased being a company lawyer and had favoured the company in causing miscarriage of justice. Departmental bias arises when the functions of a Judge and the prosecutor are combined in the same department as it is not uncommon to find that the same department which initiates the matter also decides it, therefore, at times, department fraternity and loyalty militates against the concept of fair hearing. In Hari Khemu Gawali v. The Deputy Commissioner of Police [AIR 1956 SC 559] an externment order was challenged on the ground that since the police department which heard and decided the case was the same, the element of departmental bias vitiated administrative action and this Court rejected the challenge on the ground that so long as two functions (initiation and decision) were discharged by two separate officers, though they were affiliated to the same department, there was no bias.

In The General Secretary, South Indian Cashew Factories Workers' Union v. The Managing Director, Kerala State Cashew Development Corporation Ltd. and Ors. [(2006) 5 SCC 201], it was held that the inquiry had been conducted by the Assistant Personnel Manager of the Corporation and the Union raised an industrial dispute in which Labour Court set aside the inquiry on the ground of institutional bias as the Enquiry Officer was part of the same institution and had also made certain uncorroborated remarks against the employee. This Court in appeal held that mere presumption of bias cannot be sustained on the sole ground that the officer was a part of the management and where findings of the Enquiry Officer were based on evidence and were not perverse, the mere fact that the inquiry was conducted by an officer of the management would not vitiate the inquiry. On a bare perusal of these decided cases, it could be strongly established that the fact that

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P.K.Mukherjee, the Enquiry Officer, who was also the company lawyer cannot be considered as being "biased and partisan" who favoured and was partial towards the management of the company.

13. It is fundamental to fair procedure that both sides should be heard - audi alteram partem, i.e., hear the other side and it is often considered that it is broad enough to include the rule against bias since a fair hearing must be an unbiased hearing. One of the essential ingredients of fair hearing is that a person should be served with a proper notice, i.e., a person has a right to notice. Notice should be clear and precise so as to give the other party adequate information of the case he has to meet and make an effective defence. Denial of notice and opportunity to respond result in making the administrative decision as vitiated. The adequacy of notice is a relative term and must be decided with reference to each case. But generally a notice to be adequate must contain the following: (a) time, place and nature of hearing; (b) legal authority under which hearing is to be held; (c) statement of specific charges which a person has to meet. However in The State of Karnataka & Anr. v. Mangalore University Non-Teaching Employee's Association & Ors. [(2002) 3 SCC 302] the requirement of notice will not be insisted upon as a mere technical formality when the party concerned clearly knows the case against him and is not thereby prejudiced in any manner in putting up an effective defence, then violation of the principle of natural justice cannot be insisted upon. In the present case, the materials on record show that the respondent had been furnished with proper notices intimating him the date, time and place of hearing well before time and the respondent has also received notices as is indicated from the postal acknowledgements made by him in his own letters addressed to the management.

14. It was made the major bone of contention that the charge sheet was bad as it did not mention specifically the abusive language used by the respondent. In this connection, reliance can be placed on a decision of this Court in Punjab National Bank Ltd. v. Their Workmen [(1959) 2 LLJ 666 (SC)] wherein it was held that before the management could dismiss its workman, it must hold a proper domestic enquiry into the alleged misconduct of such a workman and such an enquiry must begin with the supply of a specific charge sheet to him.In the instant case, on a perusal of the charge sheet it is evident that the charges laid down are precise and specific in nature along with the relevant provision of the standing order and neatly lays down the consequences thereof. We do not also find from the said charge sheet that there was any patent or latent vagueness involved and they are unintelligible. This is clearly evident from the explanation furnished by the respondent dated 6th of August, 1984 where he clearly denied all the charges and also mentioned the name of the four appellant-witnesses who were examined in the enquiry proceedings subsequently. This is a clear indication that the respondent was fully aware of the charges and even their specifications and also the probable witnesses for his misconduct and hence the entire plea falls flat on the face of it.

15. A proper hearing must always take in its ambit a fair opportunity to those who are parties in the controversy for correcting or contradicting anything that is prejudicial to their view. Lord Denning has observed the following in Kanda v. Government of Malaya [1962] AC 322 -

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"If the right to be heard is to be a real right which is worth anything, it must carry with it a right in the accused man to know the case which is made against him. He must know what evidence has been given and what statements have been made affecting him and then he must be given a fair opportunity to correct or contradict him."

Thus every person before the administrative authority exercising adjudicatory powers has the right to know the evidence to be used and this was firmly established in the case of Dhakeshwari Cotton Mills Ltd. v. Commissioner of Income Tax [AIR 1955 SC 65]. It is, however, very well accepted principle that supply of the adverse material need not be, unless the law otherwise provides, in its original form and it is sufficient if the summary of the contents of the material is supplied provided it is not misleading.Thus, what is essential is substantial fairness and this may be in many situations be adequately addressed and achieved by telling the affected party the substance of the case that he has to meet, without precisely discussing the precise evidence or the sources of information. The respondent has been provided with various chances to present his case before the Enquiry Officer and also present evidence that he could do to justify his defence. Further the respondent cannot claim that he is unaware of the broad charges framed against him and the witnesses against him due to the reasons stated earlier in the preceding paragraph.

16. Fair hearing also calls for a right to rebut any evidence that necessarily involves essentially two factors namely - (a) cross examination; and (b) legal representation (State of J & K vs. Bakshi Ghulam Mohammed [AIR 1967 SC 122]. In S.C .Girotra vs. United Commercial Bank [(1996) 2 LLJ 10], the Bank obtained certain reports prepared on which the charges were based and these reports were submitted by bank officers who were examined by the Enquiry Officer. On the basis of the report an employee was dismissed and the court held that there was violation of the principles of natural justice as the employee was not allowed to cross-examine the officers who deposed orally before the Inquiry Officer. In the present case, the Inquiry Officer had sent due notice and postponed the date of hearing various times with an intention to permit the respondent to present his case, nevertheless the respondent did not present himself except on three days and ultimately the Enquiry Officer conducted the inquiry ex parte. Therefore, this was not a case where the respondent was not afforded a chance to cross examine the witnesses done by the prosecution witnesses rather it seems to be a case where the respondent, had waived his right to cross examine by absenting himself from the inquiry on the grounds that he was not permitted legal representation nor was furnished with the documents or list of evidences upon which the management was relying.In Kalindi & Ors. v. Tata Locomotive & Engg.Co.Ltd. [AIR 1960 SC 914], this court held that a representation through a lawyer in any administrative proceeding is not considered as an indispensable part of natural justice as oral hearing is not included in the minima of fair hearing. To what extent it is allowed depends upon the provisions of the statute, like the Factories Law does not permit it whilst Industrial Disputes Act, 1947 allows it with the permission of the Tribunal. In Crescent Dyes and Chemicals Ltd. v. Ram Naresh Tripathi [(1993) 2 SCC 115], this Court held that right to legal representation through a lawyer or agent of choice may be restricted by a standing order also and it would amount to denial of natural justice. Further more in the case of Harinarayan Srivastava v. United Commercial Bank and Another [(1997) LLR 497 (SC)], this Court again held that refusal of Inquiry Officer

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to permit representation by an advocate even when the management was being represented by a law graduate will not be violative of the principles of natural justice if the charges are simple and not complicated. In this case, the respondent had based his case firmly on the fact that he was denied legal representation but nonetheless he could have resorted the help of a friend who could have presented his case or the registered Union could have very well taken up the matter of the concerned workman. The High Court had decided on the fact that the management was represented by a person who was a commerce graduate and passed the diploma course of social welfare who even though was not a lawyer, yet was a legally trained person and thus there was violation of the principles of natural justice, which this court believes is untenable as the respondent would have sought permission from the tribunal or would have asked help from the registered trade union. We are, therefore, of the opinion that the charges were specific and simple and not difficult to comprehend. Assuming but not admitting that there has been a denial of the principles of natural justice to the respondent to the extent that he did not know the specifications of the charges leveled, was denied a right to engage a lawyer and not furnished with the copies of the documents and list of witnesses to be relied upon by the management, even then, we are of the firm opinion that observance of the principles of natural justice to the respondent would be a useless formality which is an exception to the rationale underlying the principles of natural justice.

In S.L. Kapoor vs. Jagmohan & Ors. [(1980) 4 SCC 379], this Court under similar circumstances dealing with the denial of the principles of natural justice held that –

"it is yet another exception to the application of the principles of natural justice. Where on the admitted or undisputed facts only one conclusion is possible and under the law only one penalty is permissible, the court may not insist on the observance of the principles of natural justice because it would be futile to order its observance."

17. In Karnataka SRTC vs. S.G.Kotturappa, [(2005) 3 SCC 409], this Court again observed as follows-

"where the respondent had committed repeated acts of misconduct and had also accepted minor punishment he is not entitled to the principles on natural justice as it would be a mere formality, that too misconduct in the case of a daily wager. The question as to what extent principles of natural justice are required to be complied within a particular case would depend upon the factual situation obtained in each case and the principles cannot be applied in a vacuum. They cannot be put in a straight jacket formula."

In the present case, in the letter dated 22nd of November, 1985, the respondent had admitted all the charges and had stated unequivocally that his behavior was due to mental sickness and prayed for sympathy and mercy. This along with the fact that the respondent was earlier charged on similar grounds and dismissed but, on his request, was exonerated and given a chance to amend his conduct also goes a long way to project the fact that observance of the principles of natural justice would be merely a useless formality since he had admitted the charges against him. The High Court found that a poor workman in such a situation would be left with no option but to seek sympathy by accepting the

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allegations raised and praying for mercy. But we are of the opinion that it is too far fetched an imagination of the High Court, adhering to the belief that these are the erstwhile time preceding industrial revolution where the employer was the God and the employee was the slave.

18. At this juncture it is important to mention that this would be a futile, elongated and over stretched exercise to decide on the matter on the ground that whether the inquiry report is vitiated by the violation of the principles of natural justice. The Single Judge as well as the Division Bench of the High Court had failed miserably to perceive that on 9th of October, 1990, the tribunal deciding upon the validity of the inquiry proceedings held that it had violated the principles of natural justice and subsequently for a span of 31 months the tribunal dealt with the matter afresh, examined and cross examined both the parties and their witnesses and came to the conclusion, on basis of reasons and evidence, that the respondent was guilty of the charges. At that point, the respondent was fully aware of the charges, the specific abusive languages used, the witnesses present and had been afforded every opportunity to defend his case in the most desirable manner. Yet the High Court kept on reverting back and adjudicating upon the validity of the inquiry conducted and its report resulting into a dismissal order which is nothing but a sheer wastage of time and understanding. So the question only remains that whether the award of the tribunal dated 30th of March, 1994 upholding the dismissal was valid or not? and secondly, whether the High Court was justified in interfering with the decision and quashing and remanding it back to the tribunal for reconsideration?

19. While dealing with the domestic inquiry and misbehaviour by an employee at one inquiry and refusal to attend the next inquiry, this Court in Management of M/s. Eastern Electric & Trading Co. vs. Baldev Lal [(1975) 4 SCC 684] observed that the misbehaviour by an employee at one inquiry and refusal to attend the next inquiry held even after adjournment if the employee did not appear in the domestic inquiry, the ex parte inquiry held by the Inquiry Officer cannot be vitiated and must be held to be valid.

20. In The Chartered Bank, Bombay vs. The Chartered Bank Employees' Union [1960 (3) SCR 441], this Court observed that the tribunal or the court can interfere with the decision of the management and industrial adjudication and it would be entitled to examine the substance of the matter and decide whether the termination was in fact discharge simpliciter. If the Industrial court is satisfied that the order of discharge is punitive in nature, that it is mala fide, or that it amounts to victimization or unfair labour practice, the court or the industrial tribunal is competent to set aside the order of dismissal issued by the management and direct reinstatement of the employee.

21. Similar is the view expressed in The Tata Oil Mills Co. Ltd. Vs. Workmen & Anr. [1964 (2) SCR 125]. This Court observed in the matter of order of discharge of an employee the form of the order is not decisive. It further observed that an Industrial Tribunal has jurisdiction to examine the substance of the matter and decide whether the termination is in fact discharge simpliciter or it amounts to dismissal which has put on the cloak of discharge simpliciter. It was further observed that the test always has to be whether the act of the employer is bona fide or whether it is a mala fide and colourable

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exercise of the powers conferred by the terms of contract or by the standing orders. However, in some cases, the termination of the employee's services may appear to the industrial court to be capricious or so unreasonably severe that an interference may legitimately and reasonably be drawn that in terminating services, the employer was not acting bona fide and the test always has to be whether the act of the employer is bona fide or not. This test has been reiterated and applied in cases like Tata Engineering & Locomotive Company Ltd. v. S.C.Prasad [(1969) 2 LLJ 799], L.Michael Ltd. v. M/s Johnson Pumps Ltd.[AIR 1975 SC 661], Gujarat Steel Tubes v. Gujarat Steel Tubes Mazdoor Sangh [(1980) 1 LLJ 137 (SC)].

22. Moreover, in our view, the punishment was not harsh in comparison to the charges leveled against the respondent. In this connection, reference can be made to a decision of this Court in UP State Road Transport Corpn. v. Subhash Chandra Sharma and Others [AIR 2000 SC 1163]. Here the charge against the respondent was that he in a drunken state along with the conductor went to the Assistant Cashier in the cash room of the appellant and demanded money from him. When the Assistant cashier refused, the respondent abused him and threatened to assault him. On these facts, this Court observed as follows –

"It was certainly a serious charge of misconduct against the respondent. In such circumstances, the Labour Court was not justified in interfering with the order of removal of respondent from the service when the charge against him stood proved. Rather we find that the discretion exercised by the Labour Court in the circumstances of the present case was capricious and arbitrary and certainly not justified. It could not be said that the punishment awarded to the respondent was in any way "shockingly disproportionate" to the nature of the charge found proved against him. In our opinion, the High Court failed to exercise its jurisdiction under Article 226 of the Constitution Of India, 1950 and did not correct the erroneous order of the Labour Court which, if allowed to stand, would certainly result in miscarriage of justice."

Similarly in L.K.Verma v. H.M.T. Ltd (2006) LLR 296 (SC), it was observed that –

"as regards the quantum of the punishment is concerned suffice it to say that verbal abuse has been held to be sufficient for inflicting a punishment of dismissal. Once the appellant accepted that he had made utterances which admittedly lack civility and he also threatened a superior officer it was for him to show that he later on felt remorse therefore and should have tendered an apology".

23. From a perusal of these observations, made in the aforesaid decisions of this Court as noted herein above, it is crystal clear that the general trend of judicial decisions is to minimize the interference when the punishment is not harsh and definitely for charges that are leveled against the respondent and in the instant matter, dismissal is absolutely not shocking to the conscience of the court.

24. The learned Single Judge also misused the power vested in him by remanding back the matter to the industrial tribunal for reconsideration when the charges were found to be

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proved. The tribunal also erred in reversing its own decision on the same evidence for which we fail to see as to how the same forum can appreciate the same evidence differently. The arguments advanced by the respondent that there was violation of the principles of natural justice does not stand true and if it does it was duly redressed by the fresh inquiry conducted by the tribunal after its order dated 9th of October, 1990.

25. The argument that the work assigned to the respondent was not a part of his job even, if accepted does not entitle him to abuse his superiors and create an unhealthy atmosphere where the remaining might just take a clue from the unruly behaviour and subsequently use it to the detriment of the company. Further the letter by which he accepted all the charges sets up a strong proof against the respondent beyond which nothing remains to be analyzed.

26. In view of our discussions made herein above, we are of the view that the impugned judgment and order of the Division Bench of the High Court as well as of the learned Single Judge are liable to be set aside and the order of dismissal passed against the respondent herein must be restored. Accordingly, this appeal is allowed. There will be no order as to costs.

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Union of India and Others v Naman Singh Sekhawat8

1. Respondent at all material times was working as a Sub-Inspector (AICO-II). He was posted in the Intelligence Bureau. His principal function was to identify and collect sources of information from the locality in regard to anti national activities.

2. On or about 5th August, 1983, the respondent accompanied by the driver of an official jeep bearing Registration No. RSN 939, went to a place known as 'Ramsar Gagaria Road' in the District of Barmer. There, he allegedly found a large number of smuggled goods. While bringing the same in his jeep for their delivery to the Customs Authorities it was intercepted by a Jonga Jeep, which was being driven by one Bhoor Singh, a known smuggler, accompanied by the Head Constable Bhori Das and Constable Kirta Ram of the concerned Police Station. They were brought to the Police Station and arrested inter alia on the charge that the respondent, in conspiracy with the smugglers had been taking the smuggled goods in his official jeep.

3. Proceedings under the Customs Act, 1962 were initiated on the basis of the First Information Report lodged by the said Head Constable. A Criminal proceeding was also initiated against him for the alleged commission of offences under Sections 409, 120-B of the Indian Penal Code, 1860 read with Section 13(2) of the Foreigners Act, 1946 and Section 27 of the Arms Act, 1959 as also under Section 110 of the Customs Act, 1962.

4. In the proceeding under Section 112 of the Customs Act, 1962, the defence of the respondent inter alia was that, finding some smuggled goods stranded and abandoned while he was on a tour from near Village Gagaria, he loaded the same in the said Jeep No. RSM-939 for necessary action in relation thereto by the Customs Authorities. However, in the meantime, they were intercepted by the police authorities.

5. The driver of the vehicle Mool Singh supported the said contention of the respondent. The Additional Collector, Customs and Central Excise, upon consideration of the materials on record by the parties thereto held :-

"15. ..In his statement dated 20.8.2083 recorded under Section 108 ibid, Shri Mool Singh has corroborated the facts outlined by Naman Singh in his statement dated 20.8.1983. No independent evidence has been brought on record to show Shri Mool Singh's involvement in smuggling activities separately. Both S/Shri Naman Singh and Mool Singh in their statements recorded under Section 108 have stated that they were intercepted by the Police Officers who were sitting in a Jonga Jeep, being driven by one Bhoor Singh, a known smuggler on the Indo-Pak Border. However, in the records of the case, there is no mention about the particular Jeep in which the Police Offices were traveling and who was driving the jeep. This aspect has not been clarified even in the show cause notice. In view of this statement, the Jeep number in which the Police officers were traveling should have been obtained by the Investigating Officers particularly when an allegation has

8 Supreme Court of India 14 March 2008 Civil Appeal No. 140 of 2007 The Judgment was delivered by : HON'BLE JUSTICE S. B. SINHA

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been made against the very officers who had made the seizure that they were traveling in a Jonga Jeep belonging to a well known smuggler of the area.

16. Thus there is no evidence on record to indicate that the goods under seizure belong to either S/Shri Naman Singh or Mool Singh or Narain Singh, who were present in the jeep when the goods were seized. There is no evidence also that they had acquired goods through unauthorized route. Further, there is no evidence against Shri Latif S/o. Bheru Musalman that he was in anyway concerned with the goods under seizure. Thus, the theory given by the Police that the I.B. Officers and Narain Singh (a private person) were indulging in smuggling of goods in a Govt. Jeep does not hold any water, particularly when in their statements S/Shri Naman Singh and Mool Singh have clearly indicated that the Police Officers were traveling in Jonga Jeep belonging to Bhoor Singh, a well known smuggler of the area and Investigations have not been made either by the Police or the Customs authorities either to deny or to confirm this serious allegation. In the circumstances, on the contrary there is no reason to disbelieve that the I.B. Officers on tour found certain goods of foreign origin which they loaded in their vehicle to be taken to the nearest Customs Offices for necessary action and they were intercepted by the Police Officers, who were sitting in a private Jonga Jeep being driven by a notorious smugger of the area, a fact which has not been denied or disputed. I, therefore, hold that the ownership of the goods under seizure cannot be attributed to S/Shri Naman Singh, Mool Singh, Narain Singh and Latif to whom the show cause notice has been issued. There is no evidence on record to indicate their involvement in the smuggling of foreign origin goods from Pakistan into India."

On the basis of the aforesaid findings, whereas the goods of the foreign origin were directed to be confiscated, the charges against the respondent, Mool Singh and one Latif were dropped.

6. In the criminal proceeding against the respondent, the prosecution examined a large number of witnesses including the informant Bhori Das, PW-6 and Constable Kirta Ram, PW-7. The charges were found to have not been proved. It was inter alia held that no case under Section 409 of the Indian Penal Code, 1860 had been made out as the respondent was not entrusted with the said goods. In regard to the charge under Section 27 of the Arms Act, 1959, no offence was found to have been committed by the respondent, as he was in possession of an Arm to which he was entitled to. So far as the charge under Section 120-B of the Indian Penal Code, 1860 is concerned, a judgment of acquittal was recorded stating :-

"As elaborated earlier, when the basis of presenting prosecution has not been considered reliable by Department of Custom and the statement of the accused is considered to be more reliable, under such circumstances it cannot be considered the accused has misappropriated in this matter as visit by the employees of Intelligence Bureau on the border for discharging their duties does not tantamount to misuse of the post or the property and no such evidence has been presented that the accused Naman Singh did not have the authority to go on border side for official work and even the department had not forbidden him from going that place. Due to want of above facts it can be presumed that

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he visited the place for official work. As the misappropriation of the property is not proved, therefore, the question of criminal conspiracy does not arise. Apart from this, the crime of criminal conspiracy is an independent crime. No evidence from the prosecution side for this has been submitted."

7. The State accepted the said judgment. No appeal was preferred thereagainst. Long thereafter, namely on 1st May, 1982, for reasons best known to the appellant, a disciplinary proceeding was initiated against the respondent on two articles of charges which read as under :-

(a) During his posting at Barmer, Rajasthan in 1983, the Respondent had mis-utilized a Government vehicle and revolver for an unauthorized tour of the border area falling under PS Ramser outside the requirement of his official duties, without the knowledge or permission of his superior officers.

(b) Unauthorisedly collected and carried smuggled articles in the Government jeep which was an act unbecoming of an intelligence officer and constituted gross professional misconduct.

8. In the said departmental proceeding the police officers concerned were not examined. The Customs Officers were also not examined. No official on behalf of the department was examined, except the aforesaid Mool Singh. Mool Singh, in his evidence, fully supported the case of the respondent. He stated that the predecessors of the respondent also used to carry on similar duties and functions. He also disclosed that another officer, who had been requested to accompany them, refused to do so. He also stated that in similar situations, recovered smuggled goods had been handed over to the Customs Authorities. He also referred to an instance in regard to a similar incident which took place during the tenure of Shri D.L. Oza, CDIO.

9, Admittedly, Bhoor Singh who was driving the Jonga Jeep was in inebriated condition. He is also said to be the owner of the vehicle. How responsible police officers were traveling in the jeep of a well known smuggler defies all logic.

9. Respondent intended to examine one witness in the departmental proceedings, Jumma. He was not permitted to do so. During the course of the disciplinary proceedings his Defence Assistant was not available. A request was made to allow him to attend the enquiry proceedings. The said request was not acceded to.

10. The Inquiry Officer, however, by his report dated 9th December, 1982, found the respondent guilty of the charges of misconduct leveled against him.

11. The Disciplinary Authority passed an order of dismissal on 2nd February, 1993. The only reason assigned in support thereof reads as under:-

"Therefore, on due appreciation of the inquiry report furnished by the Inquiry Officer and representation against it made by the charged officer, I feel that the charges leveled

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against the delinquent government servant have been duly established. I being the Disciplinary Authority, dismiss Shri N.S. Shekhawat, ACIO-II (G) from the service with immediate effect, under Rule 11 (ix) of CCS (CC&A) Rules, 1965."

12. An appeal was preferred thereagainst. The appellate authority dismissed the said appeal by a detailed judgment dated 17th April, 2000, stating:-

"6. That I, JD, SIB, Jaipur being the Appellate Authority after carefully examining the appeal preferred by Sh. N.S. Shekhawat, dismissed ACIO-II, the Inquiry Report submitted by the Inquiry Officer (Shri Bhagirath Mina, the then Assistant Director, Jodhpur), the order of the Disciplinary Authority (i.e. Shri Ram Das, Assistant Director, SIB, Jaipur), and other relevant documents on record have found :-(i) That Rule 14 (15) of the CCS (CCA) Rules , 1965 provides that the Inquiry Officer, in his discretion, can call for new evidence in case he feels that there is an inherent lacuna in the evidence produced before him and that production of such evidence is necessary in the interest of justice. Accordingly, the Inquiry Officer was well within his rights to call Shri Mool Singh, JIO-II (MT) for deposition.

(ii) That the request of Shri N.S. Shekhawat for engaging a legal practioner as his defence assistant was rightly turned down, as the Presenting Officer was not a legal practitioner nor were there any special circumstances under which the delinquent could be allowed to engage a legal practitioner.

(iii) That it is also revealed from the records of the inquiry that proper summons were issued to the defence assistant viz., Shri Madhukar Sharma, Spd. (PREV), Customs and Central Excise, Ajmer and to his Controlling Officer viz., the Collector, Central Excise and Customs, Jaipur, requesting him to relieve Shri Sharma for attending the disciplinary proceedings, but he did not turn up at the enquiry.

(iv) That the request of the delinquent officer to produce one Jumma as his defence witness was rightly turned down as there was no relevance in his deposition.

(v) That the C.O. was given full opportunity to defend himself.

(vi) That from the records of the departmental proceedings, it is conclusively proved that the visit of Shri NS. Shekhawat top the border area near Village Ramsar (District Barmer) on the night of August 5, 1983 was unauthorized, during which he was detected and intercepted by the local police for unauthorisedly carrying smuggled goods 530 electronic calculators, Made in Japan, 19 Sanyo tape-cum-transistors, Made in Japan, 57 'thans' measuring 1767 mts. of synthetic fabric of 'Pak' origin; which were valued at Rs. 1 lakh 30 thousand at that time in the official governmental jeep of IB beyond any conceivable call of his legitimate duties. In his deposition dated Oct. 22, 1992 before the I.O., Shri Shekhawat has admitted having visited the area near Village Ramsar, District Barmer without the knowledge/authority of his Senior Officers for undertaking such a

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tour which certainly required the permission of the controlling officers at Jodhpur/Jaipur.

(vii) That there is nothing on record to indicate that the proceedings were not conducted as per the procedure laid down under CCS (CCA) Rules, 1965."

13. Respondent preferred an Original Application before the Central Administrative Tribunal, Jaipur Bench questioning the said order of the disciplinary authority. By a judgment and order dated 23rd October, 2001, the Tribunal, upon considering the material at some details, held :-

"In the instant case, there is no evidence to corroborate the charge against the applicant. The case of applicant is solely or mainly depend on the statement of Shri Mool Chand, (sic) who does not support the charges at all. Criminal Court has already acquitted the accused on the basis of no evidence. In support of the allegations against the applicant, no preliminary enquiry was conducted in this case. Therefore, we are of the considered opinion that there is no evidence on record to sustain the charges against the applicant and it is a case of no evidence. Therefore, the finding of the Inquiry Officer can be characterized as perverse."

Respondent, on the basis of the said findings, was directed to be reinstated in service with all consequential benefits.

14. A Writ Petition preferred thereagainst has been dismissed by a Division Bench of the Rajasthan High Court by reason of the impugned judgment.

13. Mr. Vikas Singh, learned Additional Solicitor General, appearing on behalf of the appellant would submit that the Tribunal and the High Court committed a serious error in passing the impugned judgments in so far as they failed to take into consideration :-

1) it is permissible for the disciplinary authority to initiate a departmental proceeding even after the judgment of acquittal is recorded in a criminal case inasmuch as similar evidence can be viewed differently by the criminal court and an inquiry officer having regard to the standard of proof involved in the respective proceedings ;

2) the criminal court having acquitted the respondent only on benefit of doubt, the departmental proceeding was maintainable;

3) in any event, the charges levelled against the respondent in the criminal case and the departmental proceeding were different;

4) the High Court, although noticed the legal principles operating in the field correctly, failed to apply the same to the facts of the present case;

5) the Tribunal committed a serious illegality in opining that a preliminary inquiry was required to be conducted after the judgment of acquittal was passed.

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14. Mr. Sushil Kumar Jain, learned counsel appearing on behalf of the respondent, on the other hand, urged :-

1) That the Customs Authorities as also the learned Munsif- cum-Judicial Magistrate having held that the respondent was not guilty of the charges, the impugned judgment is unassailable.

2) Respondent being the Officer Incharge of the Unit, was entitled to take all such actions which were necessary to act as an Intelligence Officer. Jumma who could have proved that the smugglers were the target of the respondent, having not been examined, the Principle of Natural Justice was violated.

3) No Circular or Notification has been brought on records to show that any permission from any higher authority was required before the respondent could take the official jeep for carrying out his official duties.

4) As an Incharge of the office, the respondent indisputably was entitled to use the government vehicle as also the arms.

5) In view of the fact that the respondent had not been found guilty both by the Customs Authorities and the Criminal Court, any embarrassment on the part of the department, on account of any action of the respondent did not and could not arise.

6) The only material brought on record being the orders of the Customs Authorities, the judgment of the criminal court and the evidence of Mool Singh, the finding recorded by the disciplinary authority was wholly perverse.

15. Respondent was a responsible officer. He was incharge of a unit. The charge against the respondent was that he had been found at the International Border, 100 kms. away from the place of posting, accompanied by a driver and a private person, having not been authorized by his superiors to make the said trip and the same was not in the course of his legitimate duties and that he had hatched a conspiracy with the smugglers. He is also accused of conspiring with the foreigners.

16. Initiation of the departmental proceeding must be viewed in the background of his total exoneration by the Customs Authorities and the criminal court.

17. The alleged occurrence took place on 5th August, 1983. As he was arrested in connection with the said matter, he must have been placed under suspension. The proceeding under the Customs Act, 1962 came to an end on 17th March, 1986. He was acquitted in the criminal case on 11th July, 1991. The Department was aware of the said proceedings. They were aware of his defence. It has not been denied or disputed that obtaining intelligence reports as regard anti smuggling activities was one of his functions. It is one thing to say that in discharge of the said function he was over enthusiastic but it

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is another thing to say that he hatched a conspiracy to assist the smugglers in carrying out smuggling activities.

18. Trans-border smuggling is a subject of federal function. We fail to understand as to why no deeper probe was made in regard to his involvement, if any, vis-a-vis the role of the officers of the concerned police station. Larger public interest demanded such probe. If the contention of the appellant was correct, the competent authority of the Central Government should have taken up the matter with the State Government. Such inaction on the part of the appellant is a matter of deep pubic concern.

19. If the charges levelled against the respondent in the departmental proceeding only related to administrative lapses on his part, it could have been initiated long back. Why was it initiated after a period nine years has not been explained. On a query made by us, the learned Additional Solicitor General, submitted that the department must have been waiting for the outcome of the criminal case. If that is so, it was expected that the evidence would have been adduced in the criminal proceeding to establish that the misuse of the jeep and the official revolver as also visiting the border area by the respondent formed part of conspiracy.The identity and the activity of the private person, who was found in the company of the respondent, should have been investigated by the competent authority, particularly when respondent was working in the Intelligence Department.

20. Whether incidental or ancillary to the issue which arose in the departmental proceeding, we must place on record that the Department of Customs of the Union of India having examined the entire question, they found the respondent innocent. As trans-border smuggling was the common theme both before the said authority as also in the criminal court, the department concerned was expected to keep a strict vigil thereover. The question of mis-utilisation of jeep etc., was not brought to the notice of the Customs Authorities. Such a question was also not raised in the criminal proceeding. It was necessary to do so so as to prove the charges of conspiracy. The prosecution, thus, utterly failed to prove such a charge.

21. In the departmental proceeding the appellant was bound to comply with the principles of natural justice. Copies of some documents were not supplied. Services of a legal practitioner, may not be a matter of right, but he was atleast entitled to the effective assistance of the departmental representative, Shri Madhukar Sharma. The same was also for all intent and purport denied.

The Tribunal in this behalf opined :-

"It is undisputed fact that Shri Mool Singh was examined although his name was not in the list of witnesses. The applicant's request to call Shri Jumma as defence witness was not allowed. Not only this but in the absence of the departmental representative Shri Madhukar Sharma, the applicant was compelled to cross- examine Shri Mool Singh who was cited as main witness in this case. It is also not disputed that the Inquiry Officer himself has cross-examined the applicant which was the duty of the departmental

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representatives. It appears that the conduct of the Inquiry Officer in this case has been throughout biased and it appears that he has acted with predetermined notions which should have caused prejudice to the applicant."We are in general agreement with the said observations.

22. Our attention has been drawn to the order passed by the appellate authority dated 17th April, 2000. It is a long order, a portion whereof we have noticed hereinbefore.

23. We may at this juncture notice that the appellate authority did not consider the legal question that the Inquiry Officer was bound to take recourse to Rule 14 of the CCS (CCA) Rules particularly when, apart from the orders of the Customs Authorities and the criminal case, no other evidence appears to have been brought on record. No reason has been assigned as to why the request of the respondent to call 'Jumma' as defence witness to prove the bonafide of the respondent had been turned down.

The bias on the part of the Inquiry Officer is explicit from the record. Why the Inquiry Officer cross-examined the respondent is beyond anybody's comprehension. He was not the prosecutor. A Presenting Officer had been appointed. The Inquiry Officer could not have taken over the job of the Presenting Officer, particularly when he was a superior officer. Valid and sufficient reasons have not been assigned by the Inquiry Officer in this behalf. His finding that the respondent should have informed his superior who was available at the close point, is contrary to the evidence of Mool Singh. According to him, the practice followed by the officers similarly situated was to take the goods found abandoned to the Customs Department and to the police station.

24. It has been suggested before us that the charges against the respondent in the criminal case and the departmental proceeding were different. However, we fail to understand what sort of public duty the respondent was expected to perform when he was intercepted by the police in a jeep which was driven by Bhoor Singh, a notorious smuggler who had been detained under MISA. If the conduct of the respondent did not cause any embarrassment to the department in the year 1983, how, after exoneration by the Customs Authorities and acquittal by the criminal court, his acts embarrassed the department, so as to form the basis of imputation of misconduct, is again beyond anybody's comprehension. The Inquiry Officer and consequently the disciplinary authority misdirected themselves in law as they posed unto themselves a wrong question. The appellate authority's findings are noticed in paragraph 12 (supra) had not been considered at all.The disciplinary authority, therefore, for all intent and purport, differed with the findings of the Customs Department as well as the criminal court, but no basis therefore was disclosed. No such evidence was brought on record. No witness was examined to prove the said fact. Even no documentary evidence was produced. The entire basis of the said finding is the ipse dixit of the Disciplinary Authority and the Appellate Authority.

It again goes to show that despite the findings of the Customs Authorities and the Criminal Court, what was uppermost in the mind of the disciplinary authority and the appellate authority was his alleged involvement in the smuggling activity.

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25. There cannot be any doubt whatsoever, as has been submitted by the learned Additional Solicitor General, that initiation of departmental proceeding is permissible even after the judgment of acquittal is recorded by the criminal court. But the same would not mean that a proceeding would be initiated only because it is lawful to do so. A departmental proceeding could be initiated if the department intended to adduce any evidence which is in its power and possession to prove the charges against the delinquent officer. Such a proceeding must be initiated bona fide. The action of the authority even in this behalf must be reasonable and fair.

26. Reliance has been placed on T.N.C.S. Corporation Ltd. and others vs. K. Meerabai : 2006 (2) SCC 255 wherein this court opined :-

"30. The scope of disciplinary proceedings and the scope of criminal proceedings in a Court of Criminal law are quite distinct, exclusive and independent of each other. The prosecution proceedings launched against the respondent herein were in respect of offences punishable under Sections 409 and 477-A IPC ., whereas the Departmental Proceedings as initiated against her were in respect of the charges of misappropriation and other fraudulent practices such as deliberate omission to bring into accounts the stock received showing bogus issues in the records, falsification of accounts, submission of defective accounts, tampering of records, manipulation of accounts and records etc. Thus, the respondent herein was proceeded against for quite different charges and on different sets of facts before the Court of Chief Judicial Magistrate, on the one hand, and before the Departmental Enquiry on the other."It was, thus, a case where the charges were different.

27. In Ajit Kumar Nag vs. General Manager (PJ), Indian Oil Corporation Ltd., Haldia and others : 2005 (7) SCC 764 this court opined that acquittal of a delinquent by a criminal court would not preclude an employer from taking action by the disciplinary authority, if it is otherwise permissible. Such a departmental proceeding, however, cannot be initiated mala fide. It must be conducted in accordance with law.

An acquittal of a delinquent ipso facto may not absolve him from undergoing disciplinary inquiry. However, where the charges are absolutely identical, ordinarily the same would not be taken resorted to.

We may notice that in Ajit Kumar Nag (supra) the order of dismissal was found to have been legally proved despite the fact that the delinquent was acquitted by the court of law.

If the Inquiry Officer is biased, no action could have been be taken on the basis thereof. It renders the proceeding a nullity. Such an inherent defect in the disciplinary proceeding cannot be cured by an order of the appellate authority. An order which is void cannot be validated by the appellate authority as the materials which were not brought on record could not be taken into consideration by it.

In Ajit Kumar Nag (supra) it was held :-

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"44. We are aware of the normal rule that a person must have a fair trial and a fair appeal and he cannot be asked to be satisfied with an unfair trial and a fair appeal. We are also conscious of the general principle that pre-decisional hearing is better and should always be preferred to post- decisional hearing. We are further aware that it has been stated that apart from Laws of Men, Laws of God also observe the rule of audi alteram partem. It has been stated that the first hearing in human history was given in the Garden of Eden. God did not pass sentence upon Adam and Eve before giving an opportunity to show cause as to why they had eaten forbidden fruit. [See R. v. University of Cambridge]. But we are also aware that principles of natural justice are not rigid or immutable and hence they cannot be imprisoned in a straight-jacket. They must yield to and change with exigencies of situations. They must be confined within their limits and cannot be allowed to run wild. It has been stated ; "To do a great right after all, it is permissible sometimes to do a little wrong".

28. Reliance has also been placed on Commissioner of Police, New Delhi vs. Narender Singh : 2006 (4) SCC 265 wherein this Court was dealing with a case of a police constable, who was accused of committing theft of arms. He made a confession of his involvement. It was found to be inadmissible in the criminal proceeding. In that factual backdrop this Court held :-

"12. It is not in dispute that the standard of proof required in recording a finding of conviction in a criminal case and in a departmental proceeding are distinct and different. Whereas in a criminal case, it is essential to prove a charge beyond all reasonable doubt, in a departmental proceeding preponderance of probability would serve the purpose. [See Kamaladevi Agarwal v. State of W.B.].

13. It is now well-settled by reason of a catena of decisions of this Court that if an employee has been acquitted of a criminal charge, the same by itself would not be a ground not to initiate a departmental proceeding against him or to drop the same in the event an order of acquittal is passed. "

29. It is not a case where a mere benefit of doubt had been given to the respondent in the criminal proceeding. The criminal court has given a positive finding that the prosecution has not been able to prove that the accused had misappropriated the goods. His visit to the border for discharging his duties did not tantamount to misuse of the post or the authority. No evidence has been presented that he did not have the authority to go to the border side on official duties and even the department had not forbidden him from going to that place. It was held that as misappropriation of the property has not been proved, the question of any criminal conspiracy did not arise.No evidence had been adduced to bring home the charge of criminal conspiracy, which is an independent crime.

30. Respondent was found to have been carrying the official revolver for his safety. No evidence was also adduced to establish that when confronted by the police party, he had

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tried to show or used the same or threatened them with the same or used the official revolver with the intention of doing illegal work.

That the respondent was allotted a jeep and also allowed to carry with him the official revolver, was accepted by the prosecution side in the criminal case, and thus, he was found not guilty under Section 27 of the Arms Act, 1959.

31. In Sawai Singh vs. State of Rajasthan : 1986 (3) SCC 454 this Court opined :-

"16 . But in a departmental enquiry entailing consequences like loss of job which now-a-days means loss of livelihood, there must be fair play in action, in respect of an order involving adverse or penal consequences against an employee, there must be investigations to the charges consistent with the requirement of the situation in accordance with the principles of natural justice in so far as these are applicable in a particular situation.

17. The application of those principles of natural justice must always be in conformity with the scheme of the Act and the subject matter of the case. It is not possible to lay down any rigid rules as to which principle of natural justice is to be applied. There is no such thing as technical natural justice. The requirements of natural justice depend upon the facts and circumstances of the case, the nature of the enquiry, the rules under which the Tribunal is acting, the subject matter to be dealt with and so on. Concept of fair play in action which is the basis of natural justice must depend upon the particular lis between the parties."

32. In Jasbir Singh vs. Punjab & Sind Bank and others : 2006 (11) Scale 204 it was held :-

"7 The learned counsel for the respondent contended that the decision of this Court has no application. He may be right. But, it is not necessary for us to delve deep into the matter as we are of the opinion that the judgment in civil matter having attained finality, the same was binding on Respondent-Bank."

33. In M.V. Bijlani vs. Union of India and others : 2006 (8) SCC 8 this Court st ated the law in the following terms :-

"25. .Although the charges in a departmental proceedings are not required to be proved like a criminal trial, i.e., beyond all reasonable doubts, we cannot lose sight of the fact that the Enquiry Officer performs a quasi-judicial function, who upon analysing the documents must arrive at a conclusion that there had been a preponderance of probability to prove the charges on the basis of materials on record. While doing so, he cannot take into consideration any irrelevant fact. He cannot refuse to consider the relevant facts. He cannot shift the burden of proof. He cannot reject the relevant testimony of the witnesses only on the basis of surmises and conjectures. He cannot enquire into the allegations with which the delinquent officer had not been charged with."

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In this case, evidence of Mool Singh is totally against the department. He was not cross-examined. It was not held that he had deposed falsely.

34. For the above said reasons, there is no infirmity in the impugned judgment. The appeal fails and is accordingly dismissed.

35. Before parting, we may, however, notice that the respondent was reinstated in service. However, after the order of stay was granted by this Court on 27th March, 2006, his services had again been terminated. He is, therefore, directed to be reinstated forthwith with all consequential benefits. The order of the Tribunal must be complied with in its entirety forthwith. Respondent is entitled to costs of the appeal which is assessed at Rupees One Lakh.

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Siemons Public Communication Networks Private v. Union of India and Others9

2. Challenge in this appeal is to the judgment of a Division Bench of the Delhi High Court dismissing the writ petition filed by the appellants. In the writ petition they had inter alia prayed for issuance of directions to the respondents 1 and 2 to award the contract in respect of tender No. DRTS/AREN/Jan-2005 floated by Bharat Electronics Limited-respondent No. 2 on behalf of Union of India-respondent No. 1 in favour of appellant No.1. They further prayed for directions to restrain respondents 1 and 2 from negotiating with any other bidder except appellant No.1 on the ground that it is the lowest bidder of the said tender.

3. The factual position in a nutshell is as follows.

Respondent No. 2, Bharat Electronics Ltd. was nominated by respondent No. 1, Ministry of Defence, Government of India, as the prime contractor for Indian Army's modernization plan for Technical Communication System (in short the 'TCS'). Respondent No. 2 floated a Request for Proposal (RFP) for procurement of Digital Radio Trunking System (in short the 'DRTS')/ also popularly known as Terrestrial Trunked Radio (in short the 'TETRA') which is a major component in the TCS Programme of the Indian Army, vide Tender No. DRTS/AREN/Jan-2005. In the RFP floated by respondent No. 2 for the DRTS, the vendors were called upon to make firm technical and commercial proposals for the supply and transfer of technology of DRTS to respondent No. 2 for incorporating in their solution to Indian Army. It was specified that the commercial offers should be for quantities of 80 systems as per Bill of Material enclosed with RFP.

The technical specifications detailed the components of the DRTS by splitting them into 9 sub-systems. The tender also stipulated that the licensed manufacture of DRTS shall be undertaken by respondent No. 2 through a Transfer of Technology (in short the 'ToT') for both hardware and software by executing a ToT Agreement between the vendor and respondent No. 2.

In terms of the tender document, the evaluation, trials and completion of the contract was proposed to be carried out in five phases spread over a period of time. Phase-I comprised a Preliminary Evaluation of Vendor Proposal and technical analysis, including presentations to be made by the vendors as also clarifications to be provided on questions raised during the presentations and subsequent analysis to the Technical Evaluation Committee (in short the 'TEC') tor being shortlisted for the Phase-II evaluations. Phase-II evaluations comprised the visits of the empowered technical team to assess the vendor system at the vendor premises to assess the technical capability, encryption, implementation, confirmation of essential parameters and suitability of equipment as per

9 Supreme Court of India 6 November 2008 Civil Appeal No. 6515 of 2008 From Final Judgment and Order Dated 10.8.2007 of Delhi High Court In W.P. (C) No. 1768 of 2007 The Judgment was delivered by : HON'BLE JUSTICE DR. ARIJIT PASAYAT 1.Leave granted.

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RFP, demonstration of system capability, mock up installation at the location of the vendors and vendors found qualified by the above criteria were to be shortlisted for Phase-Ill evaluation.

Phase-Ill evaluation required the vendors to offer three systems for user trials; one of them was to be installed in a shelter provided by respondent No. 2, which was to be followed by user trials to be conducted by an evaluation team from the Indian Army. The vendors were also required to give a written undertaking that their systems will meet all the requirements of technical and environmental evaluations, maintainability evaluation trials, etc. to be conducted in Phase-V.

Phase-IV comprised opening of the commercial offers of such of the vendors whose systems were shortlisted after Phase-Ill by a Committee in the presence of the tenderers and further negotiations were to be made only with the lowest bidder (L1) as determined by the Committee. Final Phase-V came into play after placement of order when the successful tenderer was required to supply the three systems.

On 8th February, 2005, a pre-bid meeting was held by respondent No. 2 where the prospective bidders wete apprised of the contents and basic requirements of the tender. In March 2005, eight bidders, including appellant No.1 submitted their bids in response to the RFP. Phase-I evaluation was carried out by the TEC which shortlisted six bidders for Phase-II evaluation. Phase-II evaluation was carried by the Empowered Technical Committee (in short the 'ETC')/ which after visiting the factory sites of the six qualified bidders, including appellant No.1 recommended three vendors, namely, petitioner No. 1, respondent No. 3 (M/s. Selex Communications SpA (M/s. Selex) and M/s. Thales Land & Joint Systems (M/s. Thales) for Phase-Ill evaluation. In Phase-Hi evaluation, field trials, maintainability evaluation trials, EMI/EMC testing and discussions on feasibility, etc. were held and further evaluation trials were carried out. After approval of the Technical Committee's report, all the three bidders as referred to hereinabove, qualified for Phase-rv evaluation and clearance was accorded for the next phase of evaluation. In Phase-IV, commercial bids were opened on 23rd January, 2007 in the presence of the representatives of all three bidders and the prices of the main items as per their commercial bids were read out. The total price of the three bidders worked out as under:

(i) M/s. Siemens (appellant No. 1) 16, 100, 969 Euros(ii) M/s. Selex (respondent No. 3) 25, 775, 048 Euros(iii) M/s. Thales (respondent No .4) 22, 781, 769 Euros

However, as the proposals of the bidders comprised various details contained in the enclosures to the bid, they were informed that a comprehensive evaluation would be carried out by the Expert Committee for arriving at LI bidder and that any further interaction would only be held with L1 bidders. An Evaluation Committee was constituted and the bids of the said three bidders were analysed. By letter dated 1st February, 2007, the Evaluation Committee asked for certain clarifications in the form of queries from all the three bidders including appellant No. 1. In the meeting dated 7th February, 2007 with the said three bidders they gave their clarifications to the queries

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raised by respondent Nos. 1 and 2. As a result, the Evaluation Committee completed its evaluation of the bids of the said three bidders and on 10th February, 2007 finalized the total package cost for each of the three bidders working out a comparative statement containing the details as per the scope of the RFP.

According to appellants, since respondent No.2 was not announcing the name of L-1 tenderer, they wrote to the respondents on 16.2.2007 inter alia stating that though the price bid had been opened more than three weeks back the name of L-1 had not yet been announced. On the basis of read out price of all the three bidders on 23.1.2007, the appellant No. 1 had emerged as the lowest bidder and was, therefore, entitled to be intimated the results of the tender. Grievance was made that they did not get any response from the respondent No. 2 and, therefore, they sent a reminder on 22.2.2007. Finally, by letter dated 23.2.2007 a response was received from respondent No. 2 acknowledging their representation but the outcome of the tender was not intimated. Therefore, the writ petition was filed. The prayers, as set out in the writ petition have been noted above. In essence the appellants wanted respondent No. 2 to award the tender in their favour being the lowest bidder. Counter-affidavits were filed. During the course of the hearing of the writ petition, a preliminary objection was raised regarding non-impleadment of two other bidders and they were impleaded en the oral request of the appellants.

Stand of respondent No. 2 was that the writ petitioner's price is not based on the actual package cost to meet the complete requirement of RFP, in view of the short falls while working out the actual package cost based on the assumption of number of quantities and items which the writ petitioners had ignored and the details were given in Annexure R-5.

It was stated that the Evaluation Committee has not violated any norms while preparing the report and holding M/s. Selex as L-1 bidders.It was further stated that conditions of the tender were not violated and all the guidelines as per CVC were followed scrupulously while arriving at a package price considering the complete requirement of RFP and there is no genuine grievance of the writ petitioners giving rise to any cause of action in their favour. The writ petitioner has indulged in deliberate distortion and contortion of facts and misrepresented the settled law in this regard.

5. The appellants disputed the above position and it was stated that the appellant No. 1's bid was the lowest of the 3 technical qualified bidders whose commercial bids were opened and appellant No. 1 was being ousted by adding an imaginary price of EU 11 billion to its bid, which the appellants never quoted and addition to its bid was unwarranted and amounted to artificially loading the bid. It was in essence stated that so far as Item No. 11 is concerned, a wrong view was taken on the basis of absurd reasoning. The addition of EU 11 billion to the bid of the appellants on account of Item No. 11 has resulted in increasing its total bid to EU 28 billion which, on the face of it, is absurd.

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6. Further the stand of respondent No. 2 was that the appellants could have sought necessary clarification in this regard, as was done by them in the case of other issues raised on 7.2.2007.

7. In the course of arguments the appellants stated that they were willing to provide software for 1200 users for the price quoted in the bid, i.e., for EU 8977.34. The respondents, as noted above, disputed the factual scenario as narrated by the appellants and they specifically stated that different stands have been taken at different points of time by the writ petitioners to suit their own purpose. Therefore, there was no scope for interference considering the limited scope of judicial review, particularly when, no mala fides have been alleged or pleaded. The High Court by the impugned judgment dismissed the writ petition.

8. In support of the appeal, stands taken before the High Court were reiterated. With reference to the figures indicated in the bid documents, it was submitted that a confusion was being created about the nature of the bid. It was clearly the intention of the appellants to indicate the price for 100 units. The unit base is 1 for 100 and that is how the appellants have understood the matter and had accordingly put the figure. It was submitted that there is a great price variation and in the greater public interest the bid offered by the appellants should be accepted and even they are willing to supply 1200 units at the price quoted for 1 unit, i.e., EU 8977.34.

9. Learned Counsel for the respondents on the other hand submitted that the appellants with their eyes open had quoted the figures and at different points of time have taken totally varying stands. Initially, they had stated the quantity to be "as required" and the unit price in EU to be 8977.34. The total price was left blank. At that point of time the quantity was not known and that a similar indication was made by each of the bidders. All the bidders understood the required quantity to be 1200. Interestingly the appellants had indicated the quantity to be 1 and had quoted the total price at EU 8977.34. They further submitted that the High Court rightly noted that had the respondent No. 2 proceeded on the basis of the rates furnished by the appellants in the composite bid schedule in the column (total price EU). Nothing could have precluded the appellants from turning around later on, and seeking to bind respondent No. 2 down to the rates as offered by it for a single unit in the original, the same being part of the original tender documents. It is also submitted that the variation in figures is not exorbitantly high, as is being projected by the appellants.

10. It would be appropriate to first deal with the scope of power of judicial review, more particularly, in the matter of tenders before we take note of various conclusions arrived at by the High Court.

11. In Master Marine Services (P) Ltd. v. Hodgkinson (P) Ltd. and Another, 119 (2005) DLT 139 (SC)=III (2005) SLT 664=II (2005) BC 574 (SC)=(2005) 3 SCC 138, it was observed as follows:

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"11. The principles which have to be applied injudicial review of administrative decisions, especially those relating to acceptance of tender and award of contract, have been considered in great detail by a three-Judge Bench in Tata Cellular v. Union of India, (1994) 6 SCC 651. It was observed that the principles of judicial review would apply to the exercise of contractual powers by Government bodies in order to prevent arbitrariness or favouritism. However, it must be clearly stated that there are inherent limitations in exercise of that power of judicial review. Government is the guardian of the finances of the State. It is expected to protect the financial interest of the State. The right to refuse the lowest or any other tender is always available to the Government. But, the principles laid down in Article 14 of the Constitution Of India, 1950 have to be kept in view while accepting or refusing a tender. There can be no question of infringement of Article 14 if the Government tries to get the best person or the best quotation. The right to choose cannot be considered to be an arbitrary power. Of course, if the said power is exercised of that power will be struck down.

After an exhaustive consideration of a large number of decisions and standard books on Administrative Law, the Court enunciated the principle that the modern trend points to judicial restraint in administrative action. The Court does not sit as a Court of Appeal but merely reviews the manner in which the decision was made. The Court does not have the expertise to correct the administrative decision. If a review of the administrative decision is permitted it will be substituting its own decision, without the necessary expertise, which itself may be fallible. The Government must have freedom of contract. In other words, a fairplay in the joints is a necessary concomitant for an administrative body functioning in an administrative sphere or quasi-administrative sphere. However, the decision must not only be tested by the application of Wednesbury principles of reasonableness but must be free from arbitrariness not affected by bias or actuated by mala fides. It was also pointed out that quashing decisions may impose heavy administrative burden on the administration and lead to increased and unbudgeted expenditure."

12. In Sterling Computers Ltd. v. M.N. Publications Ltd., (1993) 1 SCC 445 it was held as under:

"18. While exercising the power of judicial review, in respect of contracts entered into on behalf of the State, the Court is concerned primarily as to whether there has been any infirmity in the "decision making process". By way of judicial review the Court cannot examine the details of the terms of the contract which have been entered into by the public bodies or the State. Courts have inherent limitations on the scope of any such inquiry. But at the same time the Courts can certainly examine whether "decision making process" was reasonable rational, not arbitrary and violative of Article 14 of the Constitution Of India, 1950.

19. If the contract has been entered into without ignoring the procedure which can be said to be basic in nature and after an objective consideration of different options available taking into account the interest of the State and the public, then Court cannot act as an

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Appellate Authority by substituting its opinion in respect of selection made for entering into such contract."

13. In Raunaq International Ltd. v. I.V.R. Construction Ltd., I (1999) CLT 67 (SC)=X (1998) SLT 137=(1999 (1) SCC 492, it was observed that the award of a contract, whether it is by a private party or by a public body or the State, is essentially a commercial transaction. In arriving at a commercial decision, considerations which are of paramount importance are commercial considerations, which would include, inter alia, the price at which the party is willing to work, whether the goods or services offered are of the requisite specifications and whether the person tendering is of ability to deliver the goods or services as per specifications.

14. The law relating to award of contract by State and public sector corporations was discussed in Air India Ltd. v. Cochin International Airport Ltd., II (2000) SLT 3=I (2000) CLT 337 (SC)=2000 (2) SCC 617, and it was held that the award of a contract, whether by a private party or by a State, is essentially a commercial transaction. It can choose its own method to arrive at a decision and it is free to grant any relaxation for bona fide reasons, if the tender conditions permit such a relaxation. It was further held that the State, its corporations, instrumentalities and agencies have the public duty to be fair to all concerned. Even when some defect is found in the decision making process, the Court must exercise its discretionary powers under Article 226 with great caution and should exercise it only in furtherance of public interest and not merely on the making out of a legal point. The Court should always keep the larger public interest in mind in order to decide whether its intervention is called for or not. Only when it comes to a conclusion that overwhelming public interest requires interference, the Court should interfere.

15. In M/s.B.S.N. Joshi and Sons Ltd. v. Nair Coal Services Ltd., AIR 2007 SC 437, while summarizing the scope of judicial review and the interference of superior Courts in the award of contracts, it was observed as under:

"67. We are not oblivious of the expansive role of the superior Courts on judicial review.

68. Ws are also not shutting our eyes towards the new principles of judicial review which are being developed; but the law as it stands now having regard to the principles laid down in the aforementioned decisions may be summarized as under:

(i) If there are essential conditions/the same must be adhered to;(ii) If there is no power of general relaxation, ordinarily the same shall not be exercised and the principle of strict compliance would be applied where it is possible for all the parties to comply with all such conditions fully;(iii) If, however, a deviation is made in relation to all the parties in regard to any of such conditions, ordinarily again a power of relaxation may be held to be existing;(iv) The parties who have taken the benefit of such relaxation should not ordinarily be allowed to take a different stand in relation to compliance of another part of tender contract, particularly when he was also not in a position to comply with all the conditions of tender fully, unless the Court otherwise finds relaxation of a condition which being

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essential in nature could not be relaxed and thus the same was wholly illegal and without jurisdiction.(v) When a decision is taken by the Appropriate Authority upon due consideration of the tender document submitted by all the tenderers on their own merits and if it is ultimately found that successful bidders had in fact substantially complied with the purport and object for which essential conditions were laid down, the same may not ordinarily be interfered with.(vi) The contractors cannot form a cartel. If despite the same, their bids are considered and they are given an offer to match with the rates quoted by the lowest tenderer, public interest would be given priority.(vii) Where a decision has been taken purely on public interest, the Court ordinarily should exercise judicial restraint."

16. In Reliance Airport Developers (P) Ltd. v. Airports Authority of India and Others, (2006) 10 SCC 1, at paragraphs 56, 57 and 77, it was observed as follows:

"56. One of the points that falls for determination is the scope for judicial interference in matters of administrative decisions. Administrative action is stated to be referable to broad area of governmental activities in which the repositories of power may exercise every class of statutory function of executive, quasi- legislative and quasi-judicial nature. It is trite law that exercise of power, whether legislative or administrative, will be set aside if there is manifest error in the exercise of such power or the exercise of the power is manifestly arbitrary (See State of U.P. and Ors. v. Renusagar Power Co. and Ors., AIR 1988 SC 1737. At one time, the traditional view in England was that the executive was not answerable where its action was attributable to the exercise of prerogative power. Professor De Smith in his classical work 'Judicial Review of Administrative Action' 4th Edition at pages 285-287 states the legal position in his own terse language that the relevant principles formulated by the Courts may be broadly summarized as follows. The authority in which a discretion is vested can be compelled to exercise that discretion, but not to exercise it in any particular manner. In general, a discretion must be exercised only by the authority to which it is committed. That authority must genuinely address itself to the matter before it; it must not act under the dictates of another body or disable itself from exercising a discretion in each individual case. In the purported exercise of its discretion, it must not do what it has been forbidden to do, nor must it do what it has not been authorized to do. It must act in good faith, must have regard to all relevant considerations and must not be influenced by irrelevant considerations, must not seek to promote purposes alien to the letter or to the spirit of the legislation that gives it power to act, and must not act arbitrarily or capriciously. These several principles can conveniently be grouped in two main categories: (i) failure to exercise a discretion, and (ii) excess or abuse of discretionary power. The two classes are not, however, mutually exclusive. Thus, discretion may be improperly fettered because irrelevant considerations have been taken into account, and where an authority hands over its discretion to another body it acts ultra vires.

57. The present trend of judicial opinion is to restrict the doctrine of immunity from judicial review to those class of cases which relate to deployment of troupes, entering

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into international treaties, etc. The distinctive features of some of these recent cases signify the willingness of the Courts to assert their power to scrutinize the factual basis upon which discretionary powers have been exercised. One can conveniently classify under three heads the grounds on which administrative action is subject to control by judicial review. The first ground is illegality the second irrationality, and the third procedural impropriety. These principles were highlighted by Lord Diplock in Council of Civil Service Unions v. Minister for the Civil Service, (1984 (3) All. ER. 935, (commonly known as CCSU Case). If the power has been exercised on a non- consideration or non-application of mind to relevant factors, the exercise of power will be regarded as manifestly erroneous. If a power (whether legislative or administrative) is exercised on the basis of facts which do not exist and which are patently erroneous, such exercise of power will stand vitiated. (See Commissioner of Income-tax v. Mahindra and Mahindra Ltd., AIR 1984 SC 1182). The effect of several decisions on the question of jurisdiction have been summed up by Grahame Aldous and John Alder in their book Applications for Judicial Review, Law and Practice thus:

"There is a general presumption against ousting the jurisdiction of the Courts, so that statutory provisions which purport to exclude judicial review are construed restrictively. There are, however, certain areas of governmental activity, national security being the paradigm, which the Courts regard themselves as incompetent to investigate, beyond an initial decision as to whether the Government's claim is bona fide. In this kind of non-justiciable area judicial review is not entirely excluded, but very limited. It has also been said that powers conferred by the Royal Prerogative are inherently unreviewable but since the speeches of the House of Lords in Council of Civil Service Unions v. Minister for the Civil Service this is doubtful. Lords Diplock, Seaman and Roskili appeared to agree that there is no general distinction between powers, based upon whether their source is statutory or prerogative but that judicial review can be limited by the subject matter of a particular power, in that case national security. May prerogative powers are in fact concerned with sensitive, non-justiciable areas, for example, foreign affairs, but some are reviewable in principle, including the prerogatives relating to the civil service where national security is not involved. Another non-justiciable power is the Attorney General's prerogative to decide whether to institute legal proceedings on behalf of the public interest.

77. Expression of different views and discussions in different meetings really lead to a transparent process and transparency in the decision-making process. In the realms of contract, various choices were available. Comparison of the respective merits, offers of choice and whether that choice has been properly exercised are the deciding factors in the judicial review."17. While arriving at the aforesaid conclusions, this Court took note of the illustrious case of Tata Cellular v. Union of India, (1994) 6 SCC 651 wherein at paras 77 and 94, it was noted as follows :

"77. The duty of the Court is to confine itself to the question of legality. Its concern should be:

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1. whether a decision-making authority exceeded its powers?2. committed an error of law,3. committed a breach of the rules of natural justice,4. reached a decision which no reasonable tribunal would have reached or,5. abused its powers.

Therefore, it is not for the Court to determine whether a particular policy or particular decision taken in the fulfilment of that policy is fair. It is only concerned with the manner in which those decisions have been taken. The extent of the duty to act fairly will vary from case to case. Shortly put, the grounds upon which an administrative action is subject to control by judicial review can be classified as under:

(i) Illegality : This means the decision-maker must understand correctly the law that regulates his decision-making power and must give effect to it.(ii) Irrationality, namely, Wednesday unreasonable-ness.(iii) Procedural impropriety.

The above are only the broad grounds but it does not rule out addition of further grounds in course of time. As a matter of fact, in R. v. Secretary of State for the Home Department, ex Brind, Lord Diplock refers specifically to one development, namely, the possible recognition of the principle of proportionality. In all these cases the test to be adopted is that the Court should, "consider whether something has gone wrong of a nature and degree which requires its intervention."

94. The principles deducible from the above are:

(1) The modern trend points to judicial restraint in administrative action.(2) The Court does not sit as a Court of Appeal but merely reviews the manner in which the decision was made.(3) The Court does not have the expertise to correct the administrative decision. If a review of the administrative decision is permitted it will be substituting its own decision, without the necessary expertise which itself may be fallible.(4) The terms of the invitation to tender cannot be open to judicial scrutiny because the invitation to tender is in the realm of contract. Normally speaking, the decision to accept the tender or award the contract is reached by process of negotiations through several tiers. More often than not, such decisions are made qualitatively by experts.(5) The Government must have freedom of contract. In other words, a fair play in the joints is a necessary concomitant for an administrative body functioning in an administrative sphere or quasi-administrative sphere. However, the decision must not only be tested by the application of Wednesbury principle of reasonableness (including its other facts pointed out above) but must be free from arbitrariness not affected by bias or actuated by mala fides.(6) Quashing decisions may impose heavy administrative burden on the administration and lead to increased and unbudgeted expenditure.

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18. In Asia Foundation & Construction Ltd. v. Trafalgar House Construction (I) Ltd. And Others, I (1997) CLT 444 (SC)=(1997) 1 SCC 738, it was held as follows:

"10. Therefore, though the principle of judicial review cannot be denied so far as exercise of contractual powers of Government bodies are concerned, but it is intended to prevent arbitrariness or favouritism and it is exercised in the larger public interest or if it is brought to the notice of the Court that in the matter of award of a contract power has been exercised for any collateral purpose. But on examining the facts and circumstances Of the present case and on opinion that none of the criteria has been satisfied justifying Court's interference in the grant of contract in favour of the appellant. We are not entering into the controversy raised by Mr. Parasaran, learned Senior Counsel that the High Court committed a factual error in coming to the conclusion that respondent No. 1 was the lowest bidder and the alleged mistake committed by the consultant in the matter of bid evaluation in not taking into account the customs duty and the contention of Mr. Sorabjee, learned Senior Counsel that it has been conceded by all parties concerned before the High Court that on correction being made respondent No. 1 was the lowest bidder. As in our view in the matter of a tender a lowest bidder may not claim an enforceable right to get the contract though ordinarily the concerned authorities should accept the lowest bid. Further we find from the letter dated 12th July, 1996, that Paradip Port Trust itself has come to the following conclusion:

"the technical capability of any of the three bidders to undertake the works is not in question. Two of the bids are very similar in price. If additional commercial information which has now been provided by bidders through Paradip Port Trust, had been available at the time of assessment, the outcome appear to the favour award to AFCONS."

Strong reliance has been placed by learned Counsel for the appellants on the observations of this Court in the case of W.B. State Electricity Board v. Patel Engineering Co. Ltd. & Others, I (2001) SLT 534=(2001) 2 SCC 451, more particularly para 31.

19. It is no doubt true that while considering the matter in a broader perspective, larger public interest has to be kept in view but at the same time the other relevant factors noted by this Court in the said judgment, as reflected in paragraphs 6, 23, 24, 28, 31 and 34, need to be noted.

"6. Mr. Bhaskar P. Gupta, the learned Senior Counsel appearing for respondent No. 10, submitted that the unit rate given by respondent Nos.1 to 4 was an essential term which would be evident from Clauses 14, 27 and 29 of the ITB, so permitting them to correct the bid would tantamount to modifying the essential term of the bid and as such the High Court ought not to have directed the appellant to permit correction of bid documents and further to consider their bid along with the other bids.

23. The mistakes/errors in question, it is stated, are unintentional and occurred due to the fault of computer termed as a repetitive systematic computer typographical transmission failure. It is difficult to accept this contention. A mistake may be unilateral or mutual but it is always unintentional. If it is intentional it ceases to be a mistake. Here the mistakes

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may be unintentional but it was not beyond the control of respondents 1 to 4 to correct the same before submission of the bid. Had they been vigilant in checking the bid documents before their submission, the mistakes would have been avoided. Further, correction of such mistakes after one and a half months of opening of the bids will also be violative of Clauses 24.1, 24.3 and 29.1 of ITB.

24. The controversy in this case has arisen at the threshold. It cannot be disputed that this is an international competitive bidding which postulates keen competition and high efficiency. The bidders have or should have assistance of technical experts. The degree of care required in such a bidding is greater than in ordinary local bids for small works. It is essential to maintain the sanctity and integrity of process of tender /bid and also award of a contract. The appellant, respondents 1 to 4 and respondents 10 and 11 are all bound by the ITB which should be complied with scrupulously. In a work of this nature and magnitude where bidders who fulfil pre-qualification alone are invited to bid, adherence to the instructions cannot be given a go-bye by branding it as a pedantic approach otherwise it will encourage and provide scope for discrimination, arbitrariness and favouritism which are totally opposed to the Rule of law and our Constitutional values. The very purpose of issuing Rules/instructions is to ensure their enforcement lest the Rule of law should be a casualty. Relaxation or waiver of a rule or condition, unless so provided under ITB, by the State or its agencies (the appellant) in favour of one bidder would create justifiable doubts in the minds of other bidders, would impair the rule of transparency and fairness and provide room for manipulation to suit the whims of the State agencies in picking and choosing a bidder for awarding contracts as in the case of distributing bounty or charity. In our view such approach should always be avoided. Where power to relax or waive a rule or a condition exists under the Rules, it has to be done strictly in compliance with the Rules. We have, therefore, no hesitation in concluding that adherence to ITB or Rules is the best principle to be followed, which is also in the best public interest.

28. In the instant case, we have also noted that the mistakes in the bid documents of respondent Nos.1 to 4 even though caused on account of faulty functioning of computer, could have been discovered and notified by the said respondents with exercise of ordinary care and diligence. Here, the mistakes remained in the documents due to gross negligence in not checking the same before the submission of bid. Further Clauses 24 and 27 of ITB permit modification or withdrawal of bids after bid submission but before the dead line for submissions of the bids and not thereafter. And equity follows the law. Having submitted the bid they did not promptly act in discovering the errors and informing the same to the appellant. Though letters were written on 25.10.1999, and 17.12.1999, yet the real nature of errors/mistakes and corrections sought were not pointed out till 23.12.1999 when representation was made after interim direction of the High Court was given on 21.12.1999. Indeed it appears to us that they improved their claim in the representation. In our view the said respondents are not entitled to rectification of mistakes/error for being considered along with the other bidders.

31. The submission that remains to be considered is that as the price bid of respondents 1 to 4 is lesser by 40 crores and 80 crores than that of respondents 11 and 10 respectively,

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public interest demands that the bid of respondents 1 to 4 should be considered. The project undertaken by the appellant is undoubtedly for the benefit of public. The mode of execution of the work of the project should also ensure that the public interest is best served. Tenders are invited on the basis of competitive bidding for execution of the work of the project as it serves dual purposes. On the one hand it offers a fair opportunity to all those who are interested in competing for the contract relating to execution of the work and on the other hand it affords the appellant a choice to select the best of the competitors on competitive price without prejudice to the quality of the work. Above all it eliminates favouritism and discrimination in awarding public works to contractors. The contract is, therefore, awarded normally to the lowest tenderer which is in public interest. The principle of awarding contract to the lowest tenderer applies when all things are equal. It is equally in public interest to adhere to the rules and conditions subject to which bids are invited. Merely because a bid is the lowest the requirements of compliance of rules and conditions cannot be ignored. It is obvious that the bid of respondents 1 to 4 is the lowest of bids offered. As the bid documents of respondents 1 to 4 stands without correction there will be inherent inconsistency between the particulars given in the annexure and the total bid amount, it cannot be directed to be considered along with other bid on the sole ground of being the lowest.

34. For the reasons abovementioned, though the impugned order of the High Court insofar as it relates to quashing of letter of the appellant dated 18.12.1999 falls within the purview of judicial review, yet the direction to the appellant to permit correction of errors by respondents 1 to 4 in their bid documents and consider their bid along with other bid, goes far beyond the scope of judicial review, as elucidated by this Court in Tata Cellular. In the result, we uphold the impugned order of the Division Bench insofar as it relates to quashing of communication and letter dated 18.12.1999 and set aside that part of the impugned order giving direction to the appellant to permit respondents 1 to 4 to correct bid documents and to consider their bid after correction along with other bids. The appeal is thus allowed in part. On the facts and in the circumstances of this case we leave the parties to bear their own costs."

20. This Court emphasized that in international competitive bidding which postulates keen competition and high efficiency, the bidders should have assistance of technical experts because the degree of care required in such a bidding is greater than in ordinary local bids for small works.

21. In Jagdish Mandal v. State of Orissa & Ors., I (2007) SLT 404=I (2007) CLT 338 (SC)=2006 (14) SCALE, 224, the scope of limited power of judicial review in tender and award of contracts was also lucidly stated in paragraph 19 as follows:

"19. Judicial review of administrative action is intended to prevent arbitrariness, irrationality, unreasonableness, bias and mala fides. Its purpose is to check whether choice or decision is made 'lawfully' and not to check whether choice or decision is 'sound'. When the power of judicial review is invoked in matters relating to tenders or award of contracts, certain special features should be borne in mind. A contract is a commercial transaction. Evaluating tenders and awarding contracts are essentially

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commercial functions. Principles of equity and natural justice stay at a distance. If the decision relating to award of contract is bona fide and is in public interest, Courts will not, in exercise of power of judicial review will not be permitted to be invoked to protect private interest at the cost of public interest, or to decide contractual disputes. The tenderer or contractor with a grievance can always seek damages in a Civil Court. Attempts by unsuccessful tenderers with imaginary grievances, wounded pride and business rivalry, to make mountains out of molehills of some technical/procedural violation or some prejudice to self, and persuade Courts to interfere by exercising power of judicial review, should be resisted, Such interferences, either interim or final, may hold up public works for years, or delay relief and luceour to thousands and millions and may increase the project cost manifold, Therefore, a Court before interfering in tender or contractual matters in exercise of power of judicial review, should pose to itself the following questions:

(i) Whether the process adopted or decision made by the authority is mala fide or intended to favour someone?

ORWhether the process adopted or decision made is so arbitrary and irrational that the Court can say: 'the decision is such that no responsible authority acting reasonable and in accordance with relevant law could have reached?

(ii) Whether public interest is affected? If the answers are in the negative, there should be no interference under Article 226. Cases involving black-listing or imposition of penal consequences on a tenderer/contractor or distribution of state largesse (allotment of sites/shops, grant of licences, dealerships and franchises) stand on a different footing as they may require a higher degree of fairness in action."

22. After having taken note of the parameters for exercise of power of judicial review, the conclusions arrived at by the High Court need to be noted. The High Court has elaborately dealt with the factual position and inter alia observed as follows:

"35. In the instant case, it may be noted that it is not denied by any of the parties that at the time of floating the tender, no separate quantities were furnished to the vendors in respect of item No. 11. Thus all the bidders were in the same state as regards the required quantity by respondent No. 1. While petitioners inserted the words "As Required" in the column of "Quantity" against the said item, respondent No. 3 inserted the figure "1" in the column of "Quantity" and respondent No. 4 left the column of "Quantity" as blank. However, unit price was entered in the column "Unit Price" by each of the vendors. This was at the time of submitting the bid documents. The next relevant stage arrived on 23rd January, 2007 when the commercial bids were opened in the meeting held where the three successful vendors, namely, petitioner No. 1 and the respondent Nos. 3 and 4 were called. At that stage, respondent No. 2 for the first time declared the quantity of Vehicular Mobile Terminals as 1200 in number, based on the requirement given by the Indian Army to whom the systems were to be ultimately supplied by it. Thus the bids of each of

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the vendors became public on 23rd January, 2007. Once the bids became public, there was no question of changing/adding/ altering/modifying the same by any of the parties."

23. It needs to be noted that after opening of the bids, the Expert Committee was required to carry out a comprehensive evaluation for arriving at the L1 bidder. The Evaluation Committee while undertaking the said process, analysed the bids of each of the vendors and sought clarifications from all the three vendors wherever felt necessary and also held meetings with each of them to enable them to furnish their clarifications. Insofar as appellant No. 1 was concerned, a meeting was held on 7th February, 2007, on which date, only two queries were raised on it, neither of which related to Item No. 11. However, appellant No. 1 while responding to the two queries raised by respondent No. 2, gave a written reply under cover of letter dated 7th February, 2007 where at the end of the response, it noted as below:

"Separate pricing sheets of FF, SKD and CKD which is breakup of the composite Price Schedule are enclosed for your ready reference. Enclosed please find the composite price schedule as well for ready reference in line with RFP requirements."

In the composite price sheet in respect of Item No.11, as indicated in the statement referred to in the High Court's judgment appellant No. 1 endorsed the figure "1" in the column of "Quantity", and while filling in the price in the column of "Unit Price Euro" as also "Total Price Euro", inserted the figure, "8, 977.34". The said composite price statement was at variance with the original Bill of Materials submitted by the appellant No. 1 in respect of item No.1 1 for the reason that in the original Bill of Materials, in the column of "Quantity" the appellant had indicated "As required" and the column of "Total Price Euro" was left blank by it. The appellant have placed heavy reliance on the composite price schedule to state that there was no corelation of the quantity of 1200 given for Vehicular Mobile Stations, as specified in Item No. 4.1, with item No.11 to state that the quantity against item No. 11 was never declared and further, that at best the respondent No. 2 could have bound the appellant No. 1 down to the price indicated in the column "Total Price Euro" indicated in the composite price schedule, but it could not have multiplied the rate given in the "Unit Price" with the figure of 1200 which had resulted in absurdity.

24. As rightly noted by the High Court, the aforesaid submission, as any reference to or reliance upon the said composite price schedule submitted after opening of the commercial bids of all the vendors on an earlier date, is impermissible. Had respondent No.2 taken the composite price schedule into consideration in respect of item No.11, it would have created justifiable doubts in the minds of respondent Nos. 3 and 4 and defeated the rule of transparency and fairness on the part of respondent No. 2, as it would have amounted to improving the bid made originally by appellant No. 1, by supplying details upon ascertaining the rates quoted by the others. It was not as if the respondent No. 2 had asked any of the vendors to furnish a composite price bid to it on 7.2.2007. Specific queries were put forward by respondent No. 2 to each of the three bidders wherever clarifications were required qua particular items in the Bill of Materials submitted and other aspects of the bid. No query was raised by the respondent No. 2 on

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the appellant No. 1 in respect of item No. 11. Hence, the question of taking into consideration the clarifications given thereon by appellant No. 1 did not arise.

25. Thus, while taking note of the changes made by appellant No. 1 in respect of item No.11 in the composite price schedule, as against the original Bill of Materials submitted, the former was not taken into consideration by the Committee. Instead, the Committee made a point to observe in its analysis that no technical explanation was given by the appellant as to why the quantity had been changed by appellant No. 1 from "As required" to "1" while the "Unit Price" and "Total Price" was kept as the same in the composite price schedule. Thus the Committee multiplied the unit price furnished by appellant No. 1 with the figure 1200 to arrive at the total price, and the same method was uniformly adopted for the other two bidders. Looking at it from another angle, had the respondent No. 2 proceeded on the basis of the rate furnished by the appellants in the composite price schedule in the column, "Total Price Euro", then nothing could have precluded them from turning around later on, and seeking to bind respondent No. 2 down to the rates as offered by it for a single unit in the original Bill of Materials, the same being a part of the original tender documents. Thus, respondent No. 2 cannot be faulted for strictly adhering to the rates furnished by appellant No. 1 in its original bid documents.

26. The plea of petitioner No. 1 that the software at item No.11 had no connection or relationship with Vehicular Mobile Stations as specified in item Nos. 4.1 and 7 is also not acceptable inasmuch as for the Vehicular Mobile Stations to be operational and functional, they have to be attached to PC with software to enable a sending/receiving party to send/receive any speech/image, to/from another vehicular mobile. Thus all the three items mentioned at item Nos. 4, 7 and 11 were inter-connected and interrelated and only upon being integrated they be used for the DRTS. In any case, nothing material would turn on this for the reason that originally, prices were quoted by all the three bidders for item No.11 on a unit rate basis. The figure of 1200 cropped up much later. It is the common case of all the parties that commercial offers were to be made by all the bidders for quantities of 80 systems as per the Bill of Materials enclosed with the RFA. As no quantity was disclosed for item No.11 in the BUI of Materials, none of the bidders quoted rates for any specific quantity, but did so only for a single unit. Thus the unit rate quote remained the deciding factor for the Committee, while finally analysing the bids,

27. The contention of the appellants that they had a licence for the software under which one software unit would serve 100 units of Vehicular Mobile Terminals and as a result, the total requirement of software unit was only 12(12x100 - 1200) and not 1200 (1x1200=1200), is misconceived and without any basis for the reason that a perusal of item No. 11 of the Bill of Materials submitted by the appellants does not show that any such remarks were made therefor. In fact, the remarks column in the said Bill of Materials was left blank. Had such been the intention of appellant No. 1, nothing prevented it from indicating so in the remarks column. This conclusion is further fortified by the fact that remarks were specifically given by appellant No. 1 in the remarks column of the Bill of Materials in respect of other items, wherein it made observations to indicate wherever the price of a particular item was included in another item or where the price quoted in respect of an item was exclusive of certain other items. Thus, if appellant No. 1

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wanted to offer the price of one unit which as per its contention, was good to serve 100 users, then the same should have been so indicated in the Bill of Materials. There being no such indication in the original bid documents, respondent No. 2 could not have been expected to assume on its own that appellant No. 1 possessed a licence which permitted to use the software mentioned at item No.11 for serving 100 units. Nor can respondent No. 2 be blamed for using the multiplying factor of 1200 to arrive at the total price of units required under item No.11.

28. The appellants have also not been able to establish that respondent No.2 adopted a pick and choose policy or discriminated against appellant No.1. Respondent No. 2 dealt with all the three bidders with an even hand as the same method was adopted for arriving at the total price of materials specified in item No.11 in respect of all the three bidders. It is not the case of the appellant that they had not quoted the said price as that of a single unit. There is nothing on record by way of any remarks in the bid document to effect that the said price of a single unit was to hold good for 100 units on the ground that appellant No. 1 was granted a software licence which catered to 100 users at one time. A basic distinction has to be drawn between a case where against an item, no rates or prices or quantities are quoted, and those where some rate is quoted. Appellant No.1 having quoted a rate on a unit basis in respect of item No.11, respondent No. 2 had no option but to make the said rate the basis for arriving at the total price.

29. Accepting the interpretation as sought to be given by the appellants would amount to re-writing the entries in the bid document and reading into the bid document, terms that did not exist therein. An international bidding of such a nature being highly competitive, is also expected to be extremely precise. The technical nature of the subject matter of the contract itself postulated assistance of technical experts and thus, a very high degree of care and meticulous adherence to the requirements of the bid was inherent in such a bidding. On its part, respondent No. 2 was under an obligation to not only maintain a great degree of transparency and fair dealing on its part, but was also expected to maintain the sanctity and integrity of the entire process. Thus it was incumbent upon respondent No. 2 to ensure that no different yardsticks were adopted for any of the vendors and at the same time, to ensure that there was not the remotest possibility of discrimination, arbitrariness or favouritism.

30. There was no scope for respondent No. 2 to read into the documents, terms and conditions which did not exist in the bid documents. The appellants have also not levelled any personal allegations of mala fides or favouritism against respondent No. 2.

31. The approach of the High Court is in the right direction and the factual position obtaining has also been noted in detail and the conclusions have been arrived at.

32. The matter can be looked at from a different angle. As noted in the case of Reliance Airport Developers (P) Ltd. (supra) at para 77, if two views are possible and no mala fides or arbitrariness is alleged or shown, there is no scope for interference with the view taken by the authorities in inviting tenders.

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33. As was noted in the case of Asia Foundation & Construction Ltd. (supra) though the principle of judicial review cannot be denied so far as exercise of contractual powers of Government bodies are concerned, but it is intended to prevent arbitrariness or favouritism and it is exercised in the larger public interest or if it is brought to the notice of the Court that in the matter of award of a contract power has been exercised for any collateral purpose.

34. On examining the facts and circumstances of the present case, we are of the view that none of the criteria has been satisfied justifying Court's interference in the grant of contract in favour of the appellants. When the power of judicial review is invoked in the matters relating to tenders or award of contracts, certain special features have to be considered. A contract is a commercial transaction and evaluating tenders and awarding contracts are essentially commercial functions. In such cases principles of equity and natural justice stay at a distance. If the decision relating to award of contracts is bona fide and is in public interest, Courts will not exercise the power of judicial review and interfere even if it is accepted for the sake of argument that there is a procedural lacuna.

35. In the instant case, as has been rightly contended by the learned Addl. Solicitor General appearing for Union of India, the contract is in respect of sensitive Army equipments which are urgently needed. It cannot be held that the process adopted or decision made is so arbitrary or irrational that no responsible authority acting reasonably or in accordance with the relevant law could not have taken such a decision. The inevitable conclusion is that the appeal is devoid of any merit and deserves dismissal, which we order. However, there shall be no order as to costs.

36. Appeal dismissed.

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Official Liquidator v Dayanand and Others10

1.Leave granted in S.L.P. (C) Nos.12798/2005 and 13838/2006.

2. These appeals are directed against the orders of Calcutta and Delhi High Courts, whereby directions have been issued to the appellants herein to absorb the persons employed by the Official Liquidators attached to those High Courts under Rule 308 of the Companies (Court) Rules, 1959 (for short 'the 1959 Rules') against the posts sanctioned by the Government of India, Department of Company Affairs.

FACTS

3. For the sake of convenience, we have culled out the facts from the pleadings of Writ Petition No.1387 of 2001 filed by Tapas Chakraborty and 109 others in Calcutta High Court, Writ Petition No.2728 of 2001 filed by Smt. Daya Dua and others in Delhi High Court, the record of these appeals and documents filed/produced by the learned counsel for the parties during the pendency of the appeals. These are:

(i) There are two categories of employees in the offices of the Official Liquidators attached to different High Courts. The first category comprises of the employees who are appointed against the posts sanctioned by the Government of India, Department of Company Affairs.They are recruited in accordance with the procedure prescribed in the rules framed under proviso to Article 309 of the Constitution of India and the doctrine of equality enshrined in Articles 14 and 16 and are paid salaries and allowances from the Consolidated Fund of India. The second category comprises of the persons employed/engaged by the Official Liquidators pursuant to the sanction accorded by the concerned Court under Rule 308 of the 1959 Rules.The employees falling in this category are described as company paid staff. They are paid salaries and allowances from the fund created by disposal of the assets of the companies in liquidation.

(ii) For Calcutta High Court, the Central Government had appointed a Court Liquidator under Section 38A of the Banking Regulation Act, 1949, as amended in 1953. He used to employ staff under Rule 308 of the 1959 Rules in connection with liquidation of banking companies.

The salaries of such staff were paid from the assets of the banking companies under liquidation.

10 Supreme Court of India 4 November 2008 Civil Appeal No.2985 of 2007 With Civil Appeal Nos.2986 to 2990 of 2007 Civil Appeal No.6455/2008 @ S.L.P.(C) No.12798 of 2005 and Civil Appeal No.6456/2008 @ S.L.P. No.13838 of 2006 The Judgment was delivered by : HON'BLE JUSTICE G. S. SINGHVI

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(iii) In the year 1978, the Government of India, Ministry of Law, Justice and Company Affairs vide its letter dated 27.11.1978 circulated a scheme (hereinafter described as 'the 1978 Scheme') for absorption of company paid staff against Group C posts in the subordinate offices of the Department of Company Affairs. That scheme envisaged consideration of the cases of company paid staff, who were in position on 31.3.1978 and who possessed the educational qualifications prescribed for the post against which they were to be absorbed. It was also provided that absorption of the company paid staff will be limited to 50% vacancies in direct recruitment quota of Group C posts.

4. Sixty-three employees working under the Court Liquidator attached to Calcutta High Court filed writ petition for grant of the status of permanent Central Government employee with effect from the date of completion of 360 days of service besides regular pay scales with avenues for promotion apart from pension, provident fund and other service benefits on the basis of their length of service.

5. The learned Single Judge of Calcutta High Court allowed the writ petition in terms of the prayer made. The appeal preferred by the appellants herein was dismissed by the Division Bench, which noted that even though the writ petitioners had been working for last 20 to 25 years, neither their services were regularized nor they were paid at par with similar employees of other departments/offices and they were retired at the age of 58 years without any financial benefit. The Division Bench held that the appellants have failed to substantiate their plea that the employees appointed by the Court Liquidator were not engaged for doing work of perennial nature and that there was no reasonable basis for discriminating the Court Liquidator's staff vis-'-vis the regular employees of the office of Official Liquidator.

6. The company paid staff (Estate Clerks) engaged by the Official Liquidator attached to the High Court of Kerala also filed writ petition claiming parity with the government employees appointed in the office of the Official Liquidator. The Division Bench of that High Court took cognizance of the fact that there were two sets of employees under the Official Liquidator - (1) employees appointed by the Central Government, and (2) employees (14 in number) appointed by the Official Liquidator between 1980 and 1989 under Rule 308 of the 1959 Rules; that all the employees were doing the same work but were being paid different salaries and held that there was no rational basis for according unequal treatment to similarly situated employees. The Division Bench then referred to the 1978 Scheme, judgments of this Court in Narender Chadha vs. Union of India [1986 (2) SCC 157], Dhirendra Chamoli vs. State of U.P. [1986 (1) SCC 637], Surinder Singh and Another vs. Engineer-in-Chief, CPWD and Others [1986 (1) SCC 639], H.C. Puttaswamy vs. Hon'ble Chief Justice of Karnataka High Court, Bangalore [1991 (2) Supp. SCC 421], Bhagwati Prasad vs. Delhi State Mineral Development Corporation [1990 (1) SCC 361], Jacob M. Puthuparambil vs. Kerala Water Authority [1991 (1) SCC 28], Delhi Development Horticulture Employees' Union vs. Delhi Administration, Delhi [1992 (4) SCC 99], State of Haryana vs. Piara Singh [1992 (4) SCC 118] and held that the petitioners are entitled to be absorbed as regular Lower Division Clerks in the office of the Official Liquidator from the date of their initial appointment. Accordingly, a direction was issued to the respondents in the writ petition to absorb the Estate Clerks

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against the regular posts of Lower Division Clerks and pay them salary in the regular pay scale with consequential benefits.

7. The Government of India and Official Liquidators appealed against the orders of Calcutta and Kerala High Courts by filing petitions for special leave to appeal, which were admitted and converted into Civil Appeal Nos.5642 of 1994 (Government of India and others vs. The Court Liquidator's Employees Association and others) and Civil Appeal No.5677 of 1994 (Union of India and others vs. P.P. Bridget and others). During the pendency of those appeals, Writ Petition No.473 of 1998 filed by the company paid staff employed/engaged by the Official Liquidator of Delhi High Court claiming parity with the regular employees was also transferred to this Court. After hearing the arguments, the Court passed an interim order on 14.1.1998, which reads as under:

"In all these cases, the common question that arises for consideration is whether the persons appointed by the Official Liquidator/Court Liquidator under the orders of respective High Courts under Rules 308/309 of the Companies (Court) Rules, 1959 are entitled to equal pay and regularisation as the employees appointed by the Central Government in the office of the Official Liquidator. Learned Senior Counsel appearing for the appointees brought to our notice the findings of the High Courts rendered on the basis of the materials placed before them. They are broadly stated that the appointees were discharging identical duties and functions as that of regular employees in the office of the Official Liquidator; that they have been continuously without break working for a period ranging from 10 to 25 years; that they have been paid only a fixed salary without any benefit of pension, gratuity; that such employees appointed up to 1-7-1978 had been regularised by the Government; that though the Central Government appreciated the human problem involved in these matters and came forward before the Kerala High Court to amicably settle the issue ultimately has shown an unsympathetic attitude and that in the light of the several judgments of the Supreme Court, the appointees are entitled to regularisation and salaries as paid to the regular employees in the office of the Official Liquidator at least from three years prior to the date of the judgment of the Single Judge of the Calcutta High Court and in the Kerala cases from the date of appointment.

On the other hand, Mr. Malhotra, learned Senior Counsel appearing for the Union of India submitted that the appointees were not appointed by the Government and they were not paid salaries from the consolidated fund. On the other hand, they were paid salaries from the companies concerned under liquidation. In certain High Courts, there are Official Liquidators and Court Liquidators appointed under Section 38-A of Banking (Regulation) Act. The banking companies under liquidation originally were 75, now only there are 32 banking companies under liquidation. The appointment under court orders are not for a permanent department like Official Liquidator's office and, therefore, the appointees cannot demand regularization and payment of equal salary as that of salaries paid to regular employees in the office of the Official Liquidator.

The hard reality is that the appointees are continued on the basis of fixed salary without any retiral benefits such as pension and gratuity for more than 25 years and the functions

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they are discharging are similar to those discharged by the employees in the Office of the Official Liquidator without getting equal treatment. In the circumstances, before rendering a decision on merits by the Court, Mr Malhotra, learned Senior Counsel desired that the Government be given an opportunity to consider the matter in the light of the findings rendered by the High Courts and to come forward with an acceptable solution.

The matters are adjourned by four weeks."

8. In furtherance of the aforementioned order, the Government of India considered various proposals. Thereafter an additional affidavit was filed incorporating therein the following three options:

(i) one option that was discussed was to repeat scheme for absorption of company-paid staff as was done through the 1978 Scheme of Department of Company Affairs. There are certain practical problems in following this course of action. As per the 1978 Scheme such absorption is possible to the extent of 50% only under the direct recruitment quota in the appropriate grade. As the position obtains in the Department of Company Affairs, there is lack of adequate number of vacancies in the aforesaid category (direct recruitment) for the purpose of facilitating absorption of all these company- paid staff in the Department of Company Affairs;

(ii) the second alternative that was discussed was to continue the present arrangement without absorption of these company-paid staff. In such a situation, their salaries and service conditions could suitably be revised by the Hon'ble Company Judges with reference to funds available with the OLs in the various High Courts. According to information gathered, most of the OLs attached to various High Courts have annual surpluses. The balances in the funds maintained by many OLs are substantial; and

(iii) the third option that was discussed was to grant them age relaxation and ask them to sit in the open competitive examination as a one-time measure. This would give them a general opening not restricted to jobs in these two departments.

9. Although, the Government of India indicated its preference for option Nos.2 and 3, this Court did not approve either of them and dismissed the appeals. The transferred writ petition was allowed in similar terms - Govt. of India and others vs. Court Liquidator's Employees Association and others [1999 (8) SCC 560]. Paragraphs 21 to 24 of the judgment which have bearing on these cases read as under:

21. In view of the peculiar facts of these cases and the positive findings of the High Courts with which we concur, we are unable to agree with the contention of the learned Senior Counsel for the appellants that the company-paid staff cannot be absorbed/regularised as they were not employed by the Government in accordance with the rules; that they knew their appointments were only temporary and that their pay was not from the consolidated fund.

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22. Undoubtedly, counsel on both sides cited numerous authorities of this Court on earlier occasions sustaining the orders of absorption and setting aside the orders of absorption. We do not consider it necessary to refer to those decisions inasmuch as the facts presented before us and the findings rendered by the High Courts speak for themselves. As a matter of fact, the Government had considered as one of the options to absorb the company-paid staff as was done through the 1978 Scheme of Department of Company Affairs.

23. In the circumstances, we are satisfied that the orders of the High Court challenged in these appeals do not call for any interference having regard to the facts presented before the High Courts. Accordingly, we dismiss the appeals with no orders as to costs.

24. In view of the above, the writ petition is allowed as the relief prayed for is similar to the one claimed by the contesting respondents/company-paid staff in the connected civil appeals, without costs.

10. Notwithstanding its approval of the reasons and conclusions of Calcutta and Kerala High Courts, this Court gave an opportunity to the appellants to absorb the company paid staff working under the Court Liquidator in the Calcutta High Court and Official Liquidators in other High Courts by framing a scheme modeled on the 1978 Scheme within six months. The Court also stayed the operation of the orders appealed against and the order passed in Writ Petition (Civil) No.473 of 1998 for a period of six months to enable the appellants to frame new scheme and implement the same. This is evident from paragraph 25 of the judgment which is reproduced below :

25. However, we want to give an opportunity to the appellants in the interest of justice and to balance the equities between the parties to come forward to accept and act on the first option given in the additional affidavit, as extracted above, and absorb the company-paid staff working both under the Court Liquidator in the Calcutta High Court and the Official Liquidator in other High Courts by framing a scheme modelled on the 1978 Scheme within six months. In other words, we stay the operation of the judgment of the High Courts under appeal and the order in WP (C) No. 473 of 1988 for a period of six months to enable the appellants to frame the Scheme as suggested above and to give effect to it, failing which the judgments under appeal and the order in WP (C) No. 473 of 1988 will stand confirmed."

11. Within the time limit of six months fixed by the Court, the Government of India framed and notified new Scheme (hereinafter referred to as 'the 1999 Scheme') for absorption of the company paid staff against 50% vacancies in direct recruitment quota and also issued letter dated 1.10.1999 containing guidelines for implementation of the same. That letter reads as under :-

"ToThe Regional DirectorDepartment of Company AffairsMumbai/Calcutta/Chennai/Kanpur.

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Sub: Absorption of company paid staff of the offices of Official Liquidators against Group C posts in the subordinate offices of the Department of Company Affairs on the lines of scheme devised in 1978 - Supreme Court's judgment - regarding.

I am directed to refer to the Hon'ble Supreme Court's Judgment dated 27.08.99 (copy enclosed) on the subject mentioned above and to say that further action in the matter of absorption of the Company Paid Staff in regular Government service may please be taken on the following lines :-(i) Only such Company Paid Staff of the offices of the Official Liquidators shall be eligible for regular absorption:

(a) Who were in position as on 27.08.99 and(b) Who possess the requisite educational qualification laid down in the recruitment rules for the post against which they are to be absorbed.The Regional Directors, in their capacity as Heads of Departments, may consider the relaxation of age limits in deserving cases in accordance with the general instructions existing in this regard.

(ii) The Company Paid Staff can be absorbed against only 50% of the existing and future vacancies in your region in Group 'C' posts which, as per recruitment rules fall under direct recruitment quota. For instance, there is hundred per cent direct recruitment to the posts of Lower Division Clerks; accordingly, 50% of the existing and future vacancies of Lower Division Clerks in your region can be utilized for absorbing Company Paid Staff. Further, the posts of Upper Division Clerks, as per recruitment rules, are to be filled up entirely by promotion; therefore, there can be no possibility of absorbing Company Paid Staff in the grade of Upper Division Clerks. In the case of Junior Technical Assistants 50% of the vacancies, according to the recruitment rules are to be filled up by promotion and the remaining 50% by direct recruitment. In this case, therefore 25% of the vacancies in the grade of Junior Technical Assistants can be utilized for absorbing Company Paid Staff. The proportion of vacancies in other Group 'C' grades may similarly be worked out.

(iii) The Company Paid Staff, who were in position on 27.08.99, will be screened by a Selection Committee consisting of the following:-

1) Regional Director - Chairman2) Representative of the Staff Selection Commission -Member3) Official Liquidator of the office the company paid staff of which is to be screened - MemberThe Staff Selection Commission is also being requested to nominate different representatives for the different regions. The place, date and time of holding meeting(s) of the Selection Committee may be finalized in consultation with them.

(iv) As in the scheme of 1978, there will be no test or examination for the purpose of assessing the suitability of the Company Paid Staff. The Selection Committee will make

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its recommendations on the basis of the qualification, experience etc. and personal interview of the candidates.

2. Immediate steps may please be taken for selection of eligible members of Company Paid Staff for absorption against the existing vacancies in different grades and also the anticipated vacancies upto 31.12.2000 next. Applications may be invited indicating separately the existing vacancies and the vacancies which may occur by 31.12.2000 and making it clear that the question of absorbing be persons recommended for the anticipated vacancies will arise only if the vacancies actually occur by 31.12.2000 and that mere recommendation of the Selection Committee will not confer any right on any Company Paid Staff for being appointed in Government service.

3. A quarterly report beginning with the quarter ended 31.12.99 may be sent to the Headquarters indicating the extent to which the Company Paid Staff has been absorbed in regular Government service."

12. Thereafter, the concerned authorities undertook exercise for absorption of the company paid staff in the regular cadres of the Department of Company Affairs. As a result of this, 295 out of 399 company paid staff who were in position on 27.8.1999 were adjudged suitable. Of them 130 have been absorbed and 141 are awaiting orders. 104 were not recommended for absorption. 23 of the company paid staff either refused absorption or resigned or retired from service.

13. In the meanwhile, the company paid staff working under the Official Liquidators of Calcutta and Delhi High Courts filed writ petitions and prayed for issue of mandamus to the Union of India and others to absorb them in the regular cadres and to treat them at par with Central Government employees working in the office of the Official Liquidators.Pleadings of the parties before the High Courts Calcutta High Court

14. Tapas Chakraborty and others filed Writ Petition (Civil) No.1387 of 2001 in Calcutta High Court for issue of a direction to Government of India and Official Liquidator to absorb them in regular cadres with effect from the date of completion of 240 days' service and also for grant of benefits like pension, provident fund, gratuity, etc. calculated on the basis of total length of service. In the writ affidavit it was pleaded by the petitioners that before appointing them, the Official Liquidator use to take leave from the Hon'ble Judge hearing the company matter in the High Court; that they were appointed as a company paid staff with a stipulation that their services may be terminated at any time without assigning any reason; that all of them have worked for more than 240 days in each and every year of their service; that although they are entitled to regularization of service, the respondents have not taken any action in that direction; that their pay has not been fixed in the regular scale and they are required to retire at the age of 58 year without any financial benefit; that on or around 30th November, 1999, the respondents asked them to appear in an interview for absorption against the post of Lower Division Clerk or Junior Technical Assistant in terms of letter dated 1.10.1999; that they were not party to the proceedings before the Supreme Court; that the scheme, if any, prepared by the respondents is arbitrary and implementation thereof is afflicted by favoritism and that the

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respondents cannot take recourse to the order passed by the Supreme Court on 27.8.1999 and deprive them of their legal right to get absorption on completion of 240 days of continuous service. For better appreciation of the case projected by the writ petitioners, paragraphs 5, 6, 7, 18 and 26 and Clauses a(ii) and (iii) of the prayer clause are reproduced below:

"5. The very common thing amongst the petitioners herein is that all of them are continuing their service in the office of the Official Liquidator for more than 240 days in each and every year of their service in the office of the Official Liquidator.

6. Although your petitioners are entitled to regularization of their service in terms of the Central Government employees, but the respondents and each of them neglected to give the petitioners all the service benefits as compared to a Central Government employee.

7. Although your petitioners have all requisite qualifications, experience, your petitioners were denied their right to work with utmost dignity and compelled to work in the office of respondent No.3 with a temporary status, without any service benefits as admissible to a Central Government employee in similarly situated conditions. In a society, where unemployment is curse, your petitioners have had no other alternative but to accept the terms of service, as dictated by the respondents from time to time for running their office through your petitioners.

18. Your petitioners state that they were not a party in the said proceedings, before the Hon'ble Supreme Court of India, hence the aforesaid order of the Hon'ble Supreme Court of India, is not applicable to your petitioners. Your petitioners further state that the words 'other High Courts' as referred by the Hon'ble Apex Court is not meant for all the High Courts all over India, but it referred to those two High Courts, the staffs of the Official Liquidator of the Kerala High Court and/or of the Delhi High Court only.

26. Your petitioners state that purported scheme, if any, prepared by the respondent authorities is bad and arbitrary and without publishing the scheme for appointment and/or regularization, the respondent authorities indulged in the favouritism at the time of choosing the candidates for absorption in regular post. In absence of any scheme or modes of regularization, the respondents are taking recourse to pick and choose policy and doing gross discrimination among the temporary workers in the office of the respondent no.3.[Emphasis added]

Prayer Clause

(a)(ii) absorb the writ petitioners in regular service under the Central Government with an effective date i.e. soon after expiry of 240 days in their respective services in each continuous period of service;(iii) Furnish all the service benefits like pension, provident funds and gratuity and pay differences to the petitioners, calculating the service period of the petitioners with an

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effective date i.e. soon after expiry of 240 days in their respective services, in each continuous period of service.

15. During the pendency of the writ petition, an application was filed on behalf of the petitioners for deleting the names of some of them and for adding additional grounds to challenge the 1999 Scheme. The respondents in the writ petition objected to the amendment to the writ petition, but the learned Single Judge overruled their objection and granted the prayer of the writ petitioners.Delhi High Court

16. Smt. Daya Dua and others, who belong to the category of company paid staff employed/engaged by the Official Liquidator of Delhi High Court filed Writ Petition No.2728 of 2001 for issue of a mandamus to the respondents (appellants herein) to regularize their services against Group 'C' post from the date of initial appointment. An alternative prayer made by the writ petitioners was to direct the respondents to frame a scheme for absorption of all of them against Group 'C' posts and give them other benefits like pay and allowances at par with regular Group 'C' employees working in the office of the Official Liquidator. They pleaded that their work is of perennial nature and their duties and functions are identical to those of regular employees, but they are not being paid salary in the regular pay scale. They further pleaded that the direction given by the Supreme Court was not limited to the absorption of any particular category of company paid staff, but the 1999 Scheme is confined to Group 'C' posts and the employees who are eligible for absorption against Group 'D' posts are being discriminated. Another plea taken by the petitioners was that only 11 of company paid staff have been absorbed/regularized against Group 'C' posts and others have been left out in lurch. Clauses (a), (b) and (c) of the prayer clause of Writ Petition No.2728 of 2001 read as under:-

"a) regularize the service of the petitioners in Group 'C' Central Government posts from the date of their initial appointment;

b) without prejudice to prayer (a) above, in the alternate, frame Scheme as directed by the Hon'ble Supreme Court for absorption of all the petitioners in Group 'C' Central government posts giving therein due regard to their seniority as Group 'C' company paid staff and providing therein time bound regularization of all the petitioners which is the letter and spirit of the directions of the Hon'ble Supreme Court dated 27.8.1999 in W.P. (C) No.473/1988;

c) pay the petitioners salary and allowances at par with the Central Government appointed regular group 'C' staff in the office of the Official Liquidator attached to the Hon'ble High Court of Delhi from the date of their initial appointment."

17. The claim of the writ petitioners (respondents herein) was controverted by the Union of India and Official Liquidators of the two High Courts. The salient features of the counter affidavits filed on their behalf were:

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(i) Regular appointments against the posts sanctioned by the Government of India, Department of Company Affairs are made after following the procedure prescribed in the statutory rules.As against this, the company paid staff is engaged/employed by the Official Liquidators for fixed period after obtaining sanction from the Court under Rule 308 of the 1959 Rules.(ii) The company paid staff are neither the government servants nor their conditions of employment are regulated by statutory rules like the Central Civil Services (Conduct) Rules, which are applicable to the holders of civil posts under the Central Government.(iii) The company paid staff cannot be equated with regular employees because the source and mode of recruitment of the two categories and their status are entirely different. Moreover, while the regular employees are paid from the budget sanctioned by the Government of India, the salaries and allowances of the company paid staff are drawn from the company fund in terms of the order passed by the Court under Rule 308 read with Rule 309 of 1959 Rules.(iv) The 1999 Scheme was framed strictly in accordance with the judgment of the Supreme Court in Govt. of India and others vs. Court Liquidator's Employees Association and others (supra). The same was modeled on the 1978 Scheme and 50% of direct recruitment quota posts have been filled by absorbing the company paid staff.

18. In the counter filed in Delhi High Court, it was also pleaded that members of the company paid staff cannot claim absorption in Group 'D' post because the 1978 and 1999 Schemes do not provide for such absorption. Findings of the High Courts W.P. No.13871/2001 (Calcutta High Court)

19. The learned Single Judge briefly referred to the pleadings of the parties and held that relief deserves to be granted to the petitioners because the findings and conclusions recorded by Calcutta and Kerala High Courts in the earlier round of litigation were approved by the Supreme Court. in Govt. of India and others vs. Court Liquidator's Employees Association and others (supra), the learned Single Judge then prepared a comparative table of the two schemes and held that the 1999 Scheme is illusory because all the company paid staff cannot be absorbed against 50% vacancies of the direct recruitment quota. On the issue of absorption of the company paid staff against Group 'D' posts, the learned Single Judge observed that there is no rational reason to confine the benefit of the 1999 Scheme qua Group 'C' posts. He also delved into the legality of the absorption of respondent Nos.5 to 26 and held that the recommendations made by the Selection Committee de hors the seniority of the company paid staff has the effect of vitiating the selection. He, however, declined to nullify the absorption of the private respondents on the ground of delay and laches and proceeded to direct the respondents to prepare fresh merit list strictly in the order of seniority. The learned Single Judge also directed respondents to consider the desirability of increasing the quota of 50% by creating supernumerary posts. The operative part of the order passed by the learned Single Judge reads thus:

"The State respondents shall consider their scheme 1999 after ascertaining whether all company paid staff in the office of the Official Liquidator, Calcutta High Court can be

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absorbed as Group-C staff within three years reckoned from the date of coming into force of the said Scheme of 1999.The aforesaid exercise shall be completed within a period of three months from date hereof. If all the company paid staff cannot be absorbed as Group-C staff within the said period stipulated above, State respondents shall consider the increase in the quota of 50% or by creating supernumerary posts so that, subject to the reservation policy of the State, all the eligible company paid staff could be absorbed as Central Government staff in Group-C.

The State respondents shall consider de novo the impugned panel with respect to eligible company paid staff in Group-C strictly in the order of seniority and upon absorption of such company paid staff on the basis of such list which shall be prepared within a period of three months from date hereof, the seniority in the cadre of Group-C shall be maintained ever with respect to the company paid staff respondents 5 to 26 who have already been absorbed.As regards Group-D staff, State respondents shall take steps for regularizing such of the petitioners as may be eligible and qualified according to the rules to be absorbed as Group D staff within a period of three months from date hereof. Such regularization shall be made strictly in the order of seniority (length of service in the organization). Upon absorption/regularization such company paid staff shall be placed immediately below the last regularly appointed employees in that category, class and service, as the case may be.

Until the above directions as carried out there shall be a direction upon the respondents not to fill up any post by direct recruitment.

It is clarified that such of the petitioners who did not participate in the interview conducted by the selection committee for the purpose of absorption, their cases shall not be considered."

20. The Division Bench dismissed the appeal preferred by the appellants herein by recording the following observations:

"Since the matter regarding the right of the company paid staff of the office of the official liquidators has been decided and confirmed upto the Hon'ble Supreme Court, all that needs to be worked out is that manner in which such employees are to be absorbed in the offices of the different Official Liquidators of the different High Courts.We are in agreement with the sentiments expressed by the learned Single Judge that no a section but all the company paid staff working in the office of the Official Liquidator upto the cut off date as provided in the 1999 Scheme are to be absorbed in the office of the Official Liquidator, High Court at Calcutta, even if it means by creation of supernumerary post as observed by the learned Single Judge. Needless to say, such posts will be personal to those appointed and will cease to be in existence upon the incumbent attaining the age of superannuation."

W.P. No.2728/2001 (Delhi High Court)

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21. The learned Single Judge referred to the judgment in Govt. of India and Others vs. Court Liquidator's Employees Association and Others (supra) and negatived the plea of the appellants herein that the company paid staff can be absorbed in the regular cadre only against Group 'C' posts to the extent of 50% of direct recruitment quota and held that the writ petitioners are entitled to be absorbed against Group 'C and 'D' posts and their entire service upto the date of absorption has to be counted for the purpose of fixation of seniority and grant of other benefits including promotion. The relevant portions of the order of the learned Single Judge are reproduced below:

"I do not find any force in the argument of the respondent that 1978 scheme was only with regard to Group 'C' employees. The fact of the matter is that Group 'D' employees were appointed only in the year 1985. Therefore, there was no question of the respondent making a scheme in 1978 for Group 'D' employees. I do not find any force in the arguments of counsel for the respondents that the direction of the Supreme Court was limited with regard to the absorption of Group 'C' employees. The Supreme Court has used the words 'company paid employees', the words 'Group 'C' and Group 'D' have not been used in the judgment of Supreme Court. As discussed earlier Group 'D' employees were also petitioners before Supreme Court. I do not find any substance in the arguments of counsel for the respondents that the Supreme Court has not given a direction for giving seniority to the petitioners after their absorption. If I agree with the interpretation of the respondent that would mean a person who has worked for twenty or more years in the office of Official Liquidator and now he gets absorption his past services of twenty years or more will not be counted. The very proposition of the respondent is preposterous. The Supreme Court in its judgment has not used the words 'new appointment' but has used the word 'absorption'. The Supreme Court had categorically given a mandate to absorb all the company paid employees and not to give fresh appointment. Therefore, the incident of seniority by implication is implicit in the judgment of the Supreme Court and respondents have to absorb the petitioners giving them fitment in the their appropriate scales as well as other promotions, if any, which has to be given as per law.

I issue a writ of mandamus to the respondents to absorb the petitioners in their appropriate scales with all benefits such as fitment and promotions, if any, even if posts have to be created for the petitioners. Illegality and discrimination cannot be allowed to perpetuate indefinitely. They will also be entitled to pension, provident fund, gratuity and all benefits which are to be computed on the basis of their length of service. The petitioners shall be entitled to arrears of three years which shall be paid by the respondents to the petitioners within a period of six months."[Emphasis supplied]

22. Letters Patent Appeals preferred by the appellants were dismissed by the different Division Benches of the High Court. While deciding LPA No.808 & 809/2003, the Division Bench took cognizance of the fact that during the pendency of contempt case filed in Calcutta High Court with the complaint that order dated 26.3.2001 passed by the Single Judge of that High Court in W.P. No.211/2001 has not been complied with, the

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Central Government created 51 posts of Group 'B', 'C' and 'D' and absorbed the staff working in the office of the Court Liquidator with effect from the date of expiry of 360 days of their joining service and held that the direction given by the learned Single Judge for absorption of all Group 'C' and 'D' company paid staff does not call for interference. Particulars of the additional documents filed/produced during the course of hearing

23. Learned senior counsel appearing for Tapas Chakraborty and others filed I.A. No.10/2008 in S.L.P (C) No.12798/2008 for placing on record the following documents:

(i) Letter No.OL-CAL/24/Staff/G-Part V/2600/G dated 13th June, 2005 sent by the Official Liquidator of Calcutta High Court to the Secretary, Government of India, Ministry of Company Affairs highlighting the factum of increase in the work load and necessity of providing additional manpower.(ii) Letter No.12011/3/2003-Admn.II dated 2nd September, 2005 issued by the Government of India in the matter of "Optimization of Direct Recruitment to Civilian Posts" of Group 'C' and 'D' for the years 2001-2002, 2002-2003 and 2003-2004 and abolition of some such posts.(iii) Copy of order dated 28.2.2008 passed by the Division Bench of Kerala High Court in Writ Petition (C) No.22810/2004 and 16471/2007.(iv) Copy of letter No.RD/CLA/1/717/1135 dated 3rd June, 2008, sent by Assistant Director (Inspection), Government of India, Ministry of Corporate Affairs to the Official Liquidators of Calcutta, Cuttack, Guwahati, Patna and Ranchi asking them to send comprehensive proposal for requirement of staff along with justification for the same.(v) Letter No.OL/24/Staff/Part VII/1875/G dated 30th June, 2008 sent by the Official Liquidator of Calcutta High Court to the Regional Director, Eastern Region, Kolkata reiterating the need for additional staff to meet with the increased workload.

24. Learned senior counsel also produced two charts containing the details of Group 'C' and Group 'D' posts lying vacant in four regions as on 1.1.2008 and the number of Group 'C' posts abolished during 2001-2002, 2003-2004. He produced two more charts containing the details of the company paid staff as on 31.3.2008 in all the regions and particulars of 119 company paid staff employed/engaged by the Official Liquidator of Calcutta High Court.

25. Ms. Jyoti Mendiratta, learned counsel appearing for the respondents in the appeals arising out of the orders passed by Delhi High Court filed I.A. (unnumbered) in S.L.P. (C) No.12798/2005 for placing on record the following documents:-

(i) Copy of the details of posts with office of Official Liquidator of High Court of Bombay filed on 18.7.2008 along with tables consisting of names of the company paid staff and the date of absorption and table containing names of the 26 company paid staff from Group 'C' and Group 'D'.(ii) Letter No.12011/3/2003-Admn.II dated 2nd September, 2005 sent by Under Secretary to the Government of India, Ministry of Company Affairs to the Regional Directors of Ministry of Company Affairs of Noida, Kolkata, Mumbai and Chennai in the matter of optimization of direct recruitment to civilian posts of Group 'C' and 'D' posts in the

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Ministry for the years 2001-2002, 2002-2003 and 2003-2004 and abolition/filling up of some such posts.(iii) Letter No.OL/24/Staff/Part VII/1875/G dated 30th June, 2008 sent by the Official Liquidator of Calcutta High Court to the Regional Director, Eastern Region, Kolkata reiterating the need for increase of manpower.(iv) Copy of order dated 19.9.2005 passed by the Division Bench of Delhi High Court in LPA Nos.808/2003 and 809/2003.(v) Copy of order dated 5.5.2003 passed by learned Single Judge of Delhi High Court in CW No.2728/2001 and CM No.4774/2001.(vi) Copy of judgment dated 26.3.2001 passed by the learned Single Judge of Calcutta High Court in W.P. No.211/2001.(vii) Letter No.A-12013/1/99-Ad.II dated 27.12.1999 sent by Shri D.P. Saini, Under Secretary to the Govt. of India to all the Regional Directors of Department of Company Affairs of Kanpur, Kolkata, Mumbai and Chennai regarding clarifications/suggestions to facilitate the implementation of this Court's judgment dated 27.8.1999 for absorption of company paid staff of the offices of Official Liquidators against Group 'C' posts.

26. Shri P.P. Malhotra, Additional Solicitor General filed reply to I.A. No.10/2008 in S.L.P. (C) No.12798/2005 along with following documents:-

(i) Copy of O.M. No.2/8/2001-PIC dated 16.5.2001 containing policy decision taken by the Government of India on the issue of Optimization of Direct Recruitment to Civilian Posts and lapsing of two-third of vacancies every year.(ii) Copy of O.M. No.2/8/2001-PIC dated 30th August, 2006, whereby the Government decided to continue the scheme of Optimization of Direct Recruitment to Civilian Posts upto 31.3.2009.(iii) Copy of O.M. No.A-12011/3/2002-Ad.II dated 14.3.2005 for convening meeting of the Screening Committee to consider the issue of reducing direct recruitment to civilian posts in the Ministry of Company Affairs along with background note.

27. During the course of arguments, Shri Malhotra placed before the Court xerox copy of Writ Petition No.1387/2001 filed in Calcutta High Court along with annexed papers and the following documents:-

(i) Letter No. dated 22nd August, 2008 sent by Official Liquidator, High Court of Bombay to the Regional Director, Western Region, Mumbai on the issue of additional requirement of posts, and(ii) Copy of additional affidavit of Shri D.P. Saini, Under Secretary to the Government of India, Ministry of Finance, Department of Company Affairs filed in C.A. No.5677/1994.Arguments

28. Shri P.P. Malhotra, learned Addl. Solicitor General placed reliance on paragraph 25 of the judgment in Govt. of India and others vs. Court Liquidator's Employees Association and others (supra) and submitted that even though this Court approved the reasoning and conclusions of Calcutta and Kerala High Courts, orders passed by those Courts were rendered ineffective because operation and implementation thereof was

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stayed for six months and in terms of opportunity given to it, the Government of India not only framed the 1999 Scheme for absorption of the company paid staff, but also implemented the same. Shri Malhotra argued that High Court committed serious error by issuing direction for absorption of all the company paid staff in the regular cadres ignoring the fact that the 1999 Scheme was confined to Group C posts and that too upto 50% vacancies in the direct recruitment quota. Learned counsel emphasized that the 1999 Scheme was modeled on the 1978 Scheme and argued that the same cannot be faulted on the ground that due to abolition of posts in the Department of Company Affairs, large number of company paid staff may not get absorbed in the regular cadres till their retirement. Shri Malhotra pointed out that as early as in 2001, the Government of India had taken a policy decision to substantially reduce direct recruitment to all the cadres and recommendations made by the Screening Committee for abolition of posts in various cadres were accepted by the Government. Learned counsel emphasized that the policy decision taken by the Government of India on the issue of Optimization of Direct Recruitment to Civilian Posts was not challenged by the writ petitioners and argued that in the absence of such challenge, the High Courts were not justified in mandating creation of supernumerary posts for absorption of the company paid staff and for grant of monetary benefits to them by applying the principle of equal pay for equal work with retrospective effect. In the end, he argued that the directions given by High Courts for wholesale absorption of the company paid staff are legally unsustainable because that would result in abrogation of the rules framed under proviso to Article 309 of the Constitution Of India, 1950 in terms of which the appointing authority is obliged to make direct recruitment to various cadres.

29. Shri Bhaskar P. Gupta, learned counsel appearing for the respondents in the appeal arising out of S.L.P. No.12798 of 2005 argued that the judgment of this Court in Government of India and others vs. Court Liquidator's Employees Association & Ors. (supra) is conclusive on the issue of absorption to the company paid staff and the 1999 Scheme is liable to be quashed because the same is not only contrary to the judgment of this Court but is wholly unrealistic and impractical inasmuch as it does not provide for absorption of the company paid staff who have completed more than 10 to 20 years of service. Learned counsel pointed out that after the promulgation of 1978 Scheme, there has been multifold increase in the petitions instituted for liquidation of the companies and submitted that in order to meet the imperatives of the work relating to the companies in liquidation, the Official Liquidator was compelled to engage/employ additional staff and continue them after obtaining sanction from the Court under Rule 308 of the 1959 Rules. He then submitted that the respondents joined service as company paid staff with the fond hope that their services will be regularized and they may get opportunity of career advancement and retrial benefits but on account of unsympathetic attitude of the Government of India, their legal and constitutional rights have been violated. Learned counsel referred to letters dated 13.6.2005, 3.6.2008 (Annexures A-D) and 30.6.2008 written by the Official Liquidator and Assistant Director (Inspection), Kolkata as also letter dated 2.9.2005 written by the Under Secretary to the Government of India, Ministry of Company Affairs to the Regional Directors, NOIDA/Kolkata/Mumbai/Chennai on the subject of Optimization of Direct Recruitment to Civilian Posts in Group C and D and submitted that even though in the assessment of officers at the ground level, there is a

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dire need for increasing the strength of different cadres, the Government of India has in the garb of implementing the policy decision taken in 2001, abolished large number of posts in the direct recruitment quota, which became available in 2001-02 to 2003-04 and, in this manner, the 1999 Scheme has been made redundant. Shri Gupta invited our attention to the charts and details produced by him to show that even after being recommended by the Selection Committee as many as 141 of the company paid staff, who were in position on 27.8.1999, have not been absorbed till this day. He submitted that the Government of India cannot sit tight over the matter and frustrate the right of the company paid staff to be absorbed in the regular cadres despite the fact that they were appointed after advertisement and as on date they have continuously worked for 10 to 20 years and fulfill the conditions of eligibility prescribed for direct recruitment. Shri Gupta invoked the doctrine of legitimate expectation and argued that the High Courts did not commit any illegality by recognizing the validity of the claim made by the company paid staff and issuing direction for their absorption in regular cadres with consequential monetary benefits by creation of supernumerary posts. Learned senior counsel lamented that the manner in which the Government of India has acted in last nine years leave no room for doubt that majority of company paid staff, who were in position on 27.8.1999 may never get absorbed and may have to retire without any monetary benefits like pension, gratuity, etc. Lastly, Shri Gupta submitted that the ratio of the Constitution of India Bench judgment in Secretary, State of Karnataka vs. Uma Devi [2006 (4) SCC 1] should not be applied to these cases because the respondents had been employed/engaged after advertisement and due selection. He also relied on Randhir Singh vs. Union of India [1982 (1) SCC 618], Dhirendra Chamoli vs. State of U.P. [1986 (1) SCC 637], Surinder Singh vs. Engineer-in-Chief, C.P.W.D. [1986 (1) SCC 639 and UP State Electricity Board vs. Pooran Chandra Pandey [2007 (11) SCC 92] and argued that the respondents cannot be deprived of their constitutional right to equality in the matter of regularization of service and payment of salary in the regular pay scales on the pretext of non-availability of posts.

30. Ms. Jyoti Mendiratta referred to the pleadings of Writ Petition No.2728/2001 filed in Delhi High Court to show that as per the appellants' own case, the 1999 Scheme was a replica of the 1978 Scheme and argued that the same is liable to be quashed because while framing the new scheme, the Central Government altogether ignored the factum of employment of a number of persons by the Official Liquidator from 1985 who are eligible for absorption against Group D posts. She further argued that the lackadaisical manner in which the Central Government implemented the 1999 Scheme shattered the hopes of majority of the company paid staff and, therefore, the High Court did not commit any error by removing the discrimination practiced by the Central Government against the company paid staff who have not been absorbed even after 20 years service. She pointed out that the Official Liquidator of Delhi High Court employed/engaged company paid staff after due advertisement and selection and argued that non-availability of sanctioned posts cannot justify wholesale denial of the right to equality guaranteed to the respondents under Articles 14 and 16 of the Constitution of India . Learned counsel heavily relied on the observations made by the Division Bench of Kerala High Court in O.P. No.9732 of 1990 decided on 27.8.1993 and vehemently argued that in view unequivocal approval of that order in Government of India and others vs. Court

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Liquidator's Employees Association & Ors. (supra), the learned Single Judge of the Delhi High Court had no choice but to issue mandamus for regularization of the services of the respondents herein with consequential benefits. Learned counsel invited the Court's attention to order dated 26.3.2001 passed by the Calcutta High Court in Writ Petition No.211 of 2001 and submitted that after having sanctioned 51 posts for absorption of the staff working under the Court Liquidator of Calcutta High Court, it is not open to the Central Government to challenge the direction given by Calcutta and Delhi High Courts for regularization of company paid staff employed/engaged by the Official Liquidators on the spacious ground of abolition of posts meant to be filled by direct recruitment.

31. Shri Colin Gonsalves, and Shri Ramesh Kumar, learned counsel for the intervenors, adopted the theme of the arguments of Shri Bhaskar P. Gupta and Ms. Jyoti Mendiratta and submitted that in view of abolition of post meant to be filled by direct recruitment, the 1999 Scheme should be declared as unworkable and redundant and a direction be issued to the appellants to regularize the services of company paid staff having regard to their length of services.Consideration by the Court

32. At the outset, we consider it necessary to remove the misgivings entertained by the respondents and the High Courts that while dismissing the appeals filed by the appellants in the earlier round of litigation, this Court had endorsed the directions given by Calcutta and Kerala High Courts for absorption of company paid staff without any rider. A careful reading of paragraphs 20 to 25 of the judgment in Govt. of India and Others vs. Court Liquidator's Employees Association and Others (supra) makes it crystal clear that while approving the reasons and conclusions recorded by the High Courts and dismissing the appeals, this Court not only gave an opportunity to the appellants to frame a new scheme modeled on the 1978 Scheme within six months and implement the same but also stayed the operation of the orders impugned in the appeals and the one passed in Writ Petition (C) No.473 of 1988. The use of the words "failing which the judgments under appeal and the order in WP (C) No.473 of 1988 will stand confirmed" in paragraph 25 leaves no manner of doubt that the orders passed by the High Court and the one passed by this Court in WP (C) No.473 of 1988 were to become effective only if the Government of India had not framed new scheme modeled on the 1978 Scheme. However, the fact of the matter is that Government of India not only framed and notified the 1999 Scheme within six months from the date of judgment, but also issued guidelines for implementation of the same. Therefore, the orders passed by Calcutta and Kerala High Courts and the direction given by this Court in Writ Petition (C) No.473 of 1988 will be deemed to have become ineffective and inoperative and the respondents cannot derive any benefit from those orders and direction.

33. Now on merits. Rules 308 and 309 of 1959 Rules, which were framed by this Court under Section 643 of the Companies Act, 1956 to facilitate employment of special or additional staff in any liquidation and payment of salaries and allowances to such staff read as under:-

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308. Employment of additional or special staff - Where the Official Liquidator is of opinion that the employment of any special or additional staff is necessary in any liquidation, he shall apply to the Court for sanction, and the Court may sanction such staff as it thinks fit on such salaries and allowances as to the Court may seem appropriate.

309. Apportionment of expenses of common staff - Where any staff is employed to attend to the work of more than one liquidation, or any establishment or other charges are incurred for more than one liquidation, the expenses incurred on such staff and the common establishment and other charges, shall be apportioned by the Official Liquidator between the several liquidations concerned in such proportions as he may think fit, subject to the directions of the Judge, if any.

The above reproduced rules were framed with a view to ensure that the proceedings of liquidation are not hampered on account of shortage of staff. It was felt that if additional manpower is required for effectively dealing with liquidation cases, the Official Liquidator may apply to the Court and employ such staff after receipt of the sanction. The additional staff is paid from the company fund. If the staff employed under Rule 308 is required to attend the work of more than one liquidation or any establishment or other charges are incurred for more than one liquidation, then the Official Liquidator is required to apportion the expenses subject to the direction, if any, of the Judge concerned.

34. It is not in dispute that the respondents were engaged/employed by the Official Liquidators pursuant to the sanction accorded by the Court under Rule 308 of the 1959 Rules and from the inception of their employment, they are being paid from the fund created by disposal of the assets of the companies in liquidation. They were neither selected in accordance with the procedure prescribed under the rules framed under proviso to Article 309 of the Constitution of India nor they were appointed against the posts sanctioned by the Government of India. It is thus clear that the company paid staff constitute a separate and distinct class. While deciding the appeals in the earlier round of litigation, this Court must have been alive to the aforementioned facts and this appears to be the reason why the directions given by Calcutta and Kerala High Courts for absorption of all company paid staff were stayed for six months and an opportunity was given to the Central Government to frame a new scheme within that period.

35. Although neither of the parties to the appeals nor the intervenors have placed before the Court advertisements issued by the Official Liquidators of Bombay, Calcutta, Delhi and Madhya Pradesh or any other High Court for employment of special or additional staff in accordance with the sanction accorded by the concerned Court and we have not been apprised of the specific terms and conditions, subject to which the respondents were employed/engaged by the Official Liquidators but from the tenor of the pleadings and other records, it can be safely inferred that the respondents were appointed on purely temporary basis for fixed period with a stipulation that they shall not be entitled to seek regularization or absorption in the regular cadre against the sanctioned post. Those who applied in response to the advertisements issued by the Official Liquidators must have been aware of the fact that they were being engaged/employed pursuant to the sanction accorded by the Court under Rule 308 of the 1959 Rules in connection with liquidation

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proceedings; that their appointments will not be against the posts sanctioned by the Government; that they will have no right to claim absorption in the regular cadre and that they will be paid salaries and allowances which may be fixed by the Court. They must have accepted the appointment/engagement knowing fully well that they will have fixed tenure without any right to continue in service or to seek absorption against the sanctioned posts. It was neither the pleaded case of the respondents before the High Courts nor Shri Bhaskar P. Gupta and other learned counsel appearing on their behalf argued before this Court that their clients were lured into accepting employment as company paid staff by the Official Liquidators by promising absorption in future against the sanctioned posts or that they were coerced by some authority to accept such employment. Therefore, they cannot be heard to complain of the violation of Articles 14 and 16 of the Constitution on the ground that even after having worked for more than one decade, they have not been absorbed in the regular cadres under the Government. In our opinion, after having applied for and accepted employment/engagement as company paid staff with fixed tenure superimposed by a stipulation that they will have no right to continue in service or to be absorbed in the regular cadres, the respondents are estopped from seeking a direction for their absorption against the posts sanctioned by the Government of India and the High Courts committed a serious error in granting their prayer.

36. The argument of Shri Bhaskar P. Gupta and other learned counsel appearing for the respondents and intervenors that the 1999 Scheme is arbitrary and unreasonable and the same should be treated as having become redundant on account of abolition of posts meant for direct recruitment, which found favour with the High Courts, proceeds on the hypothesis that in the earlier round of litigation this Court, while endorsing the reasons and conclusions recorded by Calcutta and Kerala High Courts issued direction for absorption of all members of the company paid staff and the Government of India was bound to frame a scheme for that purpose. However, the very premise on which this argument is based is incorrect. Admittedly, appointment to the service comprising sanctioned posts is regulated by the rules framed under proviso to Article 309 of the Constitution Of India, 1950. The mode of recruitment and methodology of selection are prescribed under the rules. The absorption of the company paid staff employed under Rule 308 of the 1959 Rules is not one of the prescribed modes of recruitment. Therefore, it is extremely doubtful whether the Government of India could, without amending the statutory rules, frame the 1978 Scheme for absorption of the company paid staff in the regular cadres. However, as this Court has not only indirectly approved the 1978 Scheme, but also directed the Government of India to frame new scheme, we do not consider it necessary to dilate further on the subject.

37. As mentioned above, while approving the reasons and conclusions recorded by the two High Courts and dismissing the appeals, this Court not only permitted the Government of India to frame a scheme modeled on the 1978 Scheme but also stayed implementation of the orders impugned in the appeal and the one passed by itself in the transferred writ petition. If the Court intended that all members of the company paid staff working on the date of judgment i.e. 27.8.1999 should be absorbed in the regular cadres against Group 'C' and 'D' posts, then a simple direction to that effect would have been

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sufficient and there was no occasion to stay the implementation of the orders of the High Courts for six months with liberty to the Government of India to frame a new scheme within the same period. The absence of such a direction shows that the Court was very much conscious of the fact that recruitment to the regular cadres is governed by the rules framed under Article 309 of the Constitution of India and it would be highly detrimental to public interest to issue direction for wholesale absorption/regularization of the company paid staff and thereby abrogate/stultify opportunity of competition to younger generation comprising more meritorious persons who may be waiting for a chance to apply for direct recruitment. Obviously, the Court did not want to sacrifice the merit by showing undue sympathy with members of the company paid staff who joined service with full knowledge about their status, terms and conditions of their employment and the fact that they were to be paid from the company fund and not Consolidated Fund of India. In this context, we may also mention that though the Official Liquidators appear to have issued advertisements for appointing the company paid staff and made some sort of selection, more qualified and meritorious persons must have shunned from applying because they knew that the employment will be for a fixed term on fixed salary and their engagement will come to an end with the conclusion of liquidation proceedings. As a result of this, only mediocres must have responded to the advertisements and jointed as company paid staff. In this scenario, a direction for absorption of all the company paid staff has to be treated as violative of the doctrine of equality enshrined in Articles 14 and 16 of the Constitution of India .

38. Since the 1999 Scheme was framed by the Government of India in furtherance of the opportunity given by this Court and no deviation is shown to have been made from the 1978 Scheme insofar as Group 'C' posts are concerned, the same cannot be dubbed as arbitrary, irrational and unreasonable, simply because all the company paid staff who were in position as on 27.8.1999 may not get absorbed in the regular cadres. Here, it is worth noticing that as per the details of 119 company paid staff furnished by the senior counsel appearing for Tapas Chakraborty and others, only 54 had completed tenure of 10 years on 27.8.1999 i.e. the date specified in the 1999 Scheme. Of them, 21 were Lower Division Clerks, 16 were Upper Division Clerks (there is no provision for appointment to the post of Upper Division Clerk by direct recruitment), 1 was Assistant, 1 was Superintendent, 1 was Assistant Commander, 1 was Commander, 2 were Technical Assistants and the rest were Record Arrangers, Peons and Security Guards. Of the remaining 65 employees, 3 were appointed in the year 2000 and others had worked for periods ranging from 13 months to 8 years 3= months as on 27.8.1999. This means that not even 50% of the writ petitioners had completed 10 years tenure which was considered by the Courts as benchmark for issuing direction for regularization of the services of temporary/ad hoc/daily wagers employed in Government departments. The position of the company paid staff of Delhi High Court is different. The details furnished by Ms. Jyoti Mendiratta show that 27 of the company paid staff have been absorbed under the 1999 Scheme. Of the remaining 26 company paid staff, all except 1 had worked for more than 10 years as on 27.8.1999. 9 of the company paid staff had worked for 20 years or more. However, they could not be absorbed due to abolition of posts in furtherance of the policy decision taken by the Government of India.

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39. The additional documents produced by Shri Malhotra show that in the year 2001, the Government of India had taken a policy decision to reduce the strength of civilian staff in all the cadres. This was reflected in the speech made by the Finance Minister, Government of India, while presenting the budget for 2001-02. He stated that all requirements of recruitment will be scrutinized to ensure that fresh recruitment is limited to 1% of total civilian staff strength and there will be reduction in manpower by 2% per annum, achieving a reduction of 10% in 5 years. Thereafter, OM No.2/8/2001-PIC dated 16.5.2001 was issued by the Government of India. Paragraphs 2.1 and 2.2 of that OM read as under :

"2.1 All Ministries/Departments are accordingly requested to prepare Annual Direct Recruitment Plans covering the requirements of all cadres, whether managed by that Ministry/Department itself, or managed by the Department of Personnel and Training, etc. The task of preparing the Annual Recruitment Plan will be undertaken in each Ministry/Department by a Screening Committee headed by the Secretary of that Ministry/Department with the Financial Advisor as a Member and JS (Admn.) of the Department as Member Secretary. The Committee would also have one senior representative each of the Department of Personnel and Training and the Department of Expenditure. While the Annual Recruitment Plans for vacancies in Groups 'B', 'C' and 'D' could be cleared by this Committee itself, in the case of Group 'A' Services, the Annual Recruitment Plan would be cleared by a Committee headed by Cabinet Secretary with secretary of the Department concerned, Secretary (DoPT) and Secretary (Expenditure) as Members.

2.2 While preparing the Annual Recruitment Plans, the concerned Screening Committees would ensure that direct recruitment does not in any case exceed 1% of the total sanctioned strength of the Department. Since about 3% of staff retire every years, this would translate into only 1/3rd of the direct recruitment vacancies occurring in each year being filled up. Accordingly, direct recruitment would be limited to 1/3rd of the direct recruitment vacancies arising in the year subject to a further ceiling that this does not exceed 1% of the total sanctioned strength of the Department. While examining the vacancies to be filled up, the functional needs of the organization would be critically examined so that there is flexibility in filling up vacancies in various cadres depending upon their relative functional need. To amplify, in case an organization needs certain posts to be filled up for safety/security/operational considerations, a corresponding reduction in direct recruitment in other cadres of the organization may be done with a view to restricting the overall direct recruitment to one-third of vacancies meant for direct recruitment subject to the condition that the total vacancies proposed for filling up should be within the 1% ceiling. The remaining vacancies meant for direct recruitment which are not cleared by the Screening Committee will not be filled up by promotion or otherwise and these posts will stand abolished."

40. For implementation of the aforementioned decision, the Screening Committee met sometime in March, 2005 and decided to reduce the number of posts in the regular cadres of the Department of Company Affairs. The background note circulated to the members of the Screening Committee vide Office Memo No.A.12011/3/2003-Ad.II dated

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14.3.2005 made a clear mention of the orders passed by the Calcutta and Delhi High Courts in favour of the company paid staff, dismissal of the appeal by the Division Bench of Calcutta High Court, pendency of similar appeals before the Division Bench of Delhi High Court and the Government's decision to process the matter for filing SLP against the orders of Calcutta High Court. The Screening Committee which met on 16.3.2005 considered and approved abolition of the direct recruitment quota posts for the years 2001-2002, 2002-2003 and 2003-2004. The decision of the Screening Committee was circulated to various offices of the Ministry of Company Affairs vide letter No.A.12011/3/2003-Admn.II dated 2.9.2005.

This exercise was in consonance with the policy decision taken by the Government of India. The respondents have neither assailed the decision of the Government to abolish the posts on the ground of malafides nor the learned counsel could show that the exercise undertaken by the Screening Committee is vitiated by arbitrariness or non-application of mind or the same is influenced by extraneous reasons. Therefore, the view expressed by the Calcutta and Delhi High Courts that the 1999 Scheme is unworkable or impractical or has become redundant, cannot be approved.

41. The creation and abolition of posts, formation and structuring/ restructuring of cadres, prescribing the source and mode of recruitment and qualifications and criteria of selection etc. are matters which fall within the exclusive domain of the employer. Although the decision of the employer to create or abolish posts or cadres or to prescribe the source or mode of recruitment and lay down the qualification etc. is not immune from judicial review, the Court will always be extremely cautious and circumspect in tinkering with the exercise of discretion by the employer. The Court cannot sit in appeal over the judgment of the employer and ordain that a particular post or number of posts be created or filled by a particular mode of recruitment. The power of judicial review can be exercised in such matters only if it is shown that the action of the employer is contrary to any constitutional or statutory provisions or is patently arbitrary or vitiated by malafides.

42. In State of Haryana vs. Navneet Verma [2008 (2) SCC 65], a Division Bench of two-Judges referred to M. Ramanatha Pillai vs. State of Kerala [1973 (2) SCC 650], Kedar Nath Bahi vs. State of Punjab [1974 (3) SCC 21], State of Haryana vs. Des Raj Sangar [1976 (2) SCC 844], Dr. N.C. Singhal vs. Union of India [1980 (3) SCC 29) and Avas Vikas Sanghathan vs. Engineers Association [2006 (4) SCC 132) and culled out the following principles :

"(a) the power to create or abolish a post rests with the Government;(b) whether a particular post is necessary is a matter depending upon the exigencies of the situation and administrative necessity;(c) creation and abolition of posts is a matter of government policy and every sovereign government has this power in the interest and necessity of internal administration;(d) creation, continuance and abolition of posts are all decided by the Government in the interest of administration and general public;

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(e) the court would be the least competent in the face of scanty material to decide whether the Government acted honestly in creating a post or refusing to create a post or its decision suffers from mala fides, legal or factual;(f) as long as the decision to abolish the post is taken in good faith in the absence of material, interference by the court is not warranted."

43. In Secretary, State of Karnataka vs. Uma Devi (supra), the Constitution of India Bench adverted its attention to financial implications of creation of extra posts and held that the Courts should not pass orders which impose unwarranted burden on the State and its instrumentalities by directing creation of particular number of posts for absorption of employees appointed on ad hoc or temporary basis or as daily wagers.

44. In Divisional Manager, Aravali Golf Club and another vs. Chander Hass and another [(2008) 1 SCC 683] also, a two-Judges Bench considered the issue relating to creation of post and held :-

"15. The court cannot direct the creation of posts. Creation and sanction of posts is a prerogative of the executive or legislative authorities and the court cannot arrogate to itself this purely executive or legislative function, and direct creation of posts in any organisation. This Court has time and again pointed out that the creation of a post is an executive or legislative function and it involves economic factors. Hence the courts cannot take upon themselves the power of creation of a post. Therefore, the directions given by the High Court and the first appellate court to create the posts of tractor driver and regularise the services of the respondents against the said posts cannot be sustained and are hereby set aside."

45. Although in paras 20, 26, 27, 28 and 33 of the last mentioned judgment some sweeping observations have been made suggesting that the orders passed by the High Courts and this Court in some of the cases amount to an encroachment on the domain of the executive and legislature, we do not propose to deal with the same and decide whether those observations were at all called for in the backdrop of factual matrix of that case and leave the same to be decided in an appropriate case.

46. In view of the above stated legal position, we hold that the directions given by the High Courts for creation of supernumerary posts to facilitate absorption of the company paid staff are legally unsustainable and are liable to be set aside.

47. The next issue which needs to be address is whether the impugned orders can be sustained on the ground that by having worked continuously for 10 years or more as company paid staff as on 27.8.1999, some of the respondents acquired a right to be absorbed in the regular cadre or regularized in service and they are entitled to the benefit of the principle of equal pay for equal work and have their pay fixed in the regular pay scales prescribed for the particular posts.

48. The questions whether in exercise of the power vested in it under Article 226 of the Constitution Of India, 1950, the High Court can issue a mandamus and compel the State

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and its instrumentalities/agencies to regularize the services of temporary/ad-hoc/daily wager/casual/contract employees and whether direction can be issued to the public employer to prescribe or give similar pay scales to employees appointed through different modes, with different condition of service and different sources of payment have become subject matter of debate and adjudication in several cases.

49. The judgments of 1980s and early 1990s - Dhirendra Chamoli vs. State of U.P. [1986 (1) SCC 637], Surinder Singh and Another vs. Engineer-in-Chief, CPWD and Others [1986 (1) SCC 639], Daily Rated Casual Labour vs. Union of India [1988 (1) SCC 122], Dharwad District P.W.D. Literate Daily Wage Employees' Association vs. State of Karnataka [1990 (2) SCC 396], Bhagwati Prasad vs. Delhi State Mineral Development Corporation (supra), State of Haryana vs. Piara Singh (supra) are representative of an era when this Court enthusiastically endeavored to expand the meaning of equality clause enshrined in the Constitution of India and ordained that employees appointed on temporary/ad hoc/daily wage basis should be treated at par with regular employees in the matter of payment of salaries and allowances and that their services be regularized. In several cases, the schemes framed by the governments and public employer for regularization of temporary/ad- hoc/daily wag/casual employees irrespective of the source and mode of their appointment/ engagement were also approved. In some cases, the courts also directed the State and its instrumentalities/agencies to frame schemes for regularization of the services of such employees. In State of Haryana vs. Piara Singh (supra), this Court while reiterating that appointment to the public posts should ordinarily be made by regular recruitment through the prescribed agency and that even where ad-hoc or temporary employment is necessitated on account of the exigencies of administration, the candidate should be drawn from the employment exchange and that if no candidate is available or sponsored with the employment exchange, some method consistent with the requirements of Article 14 of the Constitution of India should be followed by publishing notice in appropriate manner for calling for applications and all those who apply in response thereto should be considered fairly, proceeded to observe that if an ad-hoc or temporary employee is continued for a fairly long spell, the authorities are duty bound to consider his case for regularization subject to his fulfilling the conditions of eligibility and the requirement of satisfactory service. The propositions laid down in Piara Singh's case were followed by almost all High Courts for directing the concerned State Governments and public authorities to regularize the services of ad- hoc/temporary/daily wage employees only on the ground that they have continued for a particular length of time. In some cases, the schemes framed for regularization of the services of the backdoor entrants were also approved.

50. The above noted judgments and orders encouraged the political set up and bureaucracy to violate the soul of Article 14 and 16 as also the provisions contained in the Employment Exchanges (Compulsory Notification of Vacancies) Act, 1959 with impunity and the spoil system which prevailed in the United Stats of America in sixteenth and seventeenth century got firm foothold in this country. Thousands of persons were employed/engaged throughout the length and breadth of the country by backdoor methods. Those who could pull strings in the power corridors at the higher and lower levels managed to get the cake of public employment by trampling over the rights of

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other eligible and more meritorious persons registered with the employment exchanges. A huge illegal employment market developed in different parts of the country and rampant corruption afflicted the whole system. This was recognized by the Court in Delhi Development Horticulture Employees Union vs. Delhi Administration, Delhi and others [1992 (4) SCC 99] in the following words:

"23. Apart from the fact that the petitioners cannot be directed to be regularised for the reasons given above, we may take note of the pernicious consequences to which the direction for regularisation of workmen on the only ground that they have put in work for 240 or more days, has been leading. Although there is an Employment Exchange Act which requires recruitment on the basis of registration in the Employment Exchange, it has become a common practice to ignore the Employment Exchange and the persons registered in the Employment Exchanges, and to employ and get employed directly those who are either not registered with the Employment Exchange or who though registered are lower in the long waiting list in the Employment Register. The courts can take judicial notice of the fact that such employment is sought and given directly for various illegal considerations including money. The employment is given first for temporary periods with technical breaks to circumvent the relevant rules, and is continued for 240 or more days with a view to give the benefit of regularization knowing the judicial trend that those who have completed 240 or more days are directed to be automatically regularized. A good deal of illegal employment market has developed resulting in a new source of corruption and frustration of those who are waiting at the Employment Exchanges for years.

Not all those who gain such backdoor entry in the employment are in need of the particular jobs. Though already employed elsewhere, they join the jobs for better and secured prospects. That is why most of the cases which come to the courts are of employment in government departments, public undertakings or agencies.

Ultimately it is the people who bear the heavy burden of the surplus labour. The other equally injurious effect of indiscriminate regularization has been that many of the agencies have stopped undertaking casual or temporary works though they are urgent and essential for fear that if those who are employed on such works are required to be continued for 240 or more days they have to be absorbed as regular employees although the works are time-bound and there is no need of the workmen beyond the completion of the works undertaken. The public interests are thus jeopardised on both counts."

51. The menace of illegal and backdoor appointments compelled the Courts to have rethinking and in large number of subsequent judgments this Court declined to entertain the claims of ad-hoc and temporary employees for regularization of services and even reversed the orders passed by the High Courts and Administrative Tribunals - Director, Institute of Management Development, U.P. vs. Pushpa Srivastava [1992 (4) SCC 33], Dr. M.A. Haque and Others vs. Union of India and Others [1993 (2) SCC 213], J & K Public Service Commission vs. Dr. Narinder Mohan [1994 (2) SCC 630], Dr. Arundhati Ajit Pargaonkar vs. State of Maharashtra [1994 Suppl. (3) SCC 380], Union of India vs.

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Kishan Gopal Vyas [1996 (7) SCC 134], Union of India vs. Moti Lal [1996 (7) SCC 481], Hindustan Shipyard Ltd. vs. Dr. P. Sambasiva Rao [1996 (7) SCC 499],

52. The shift in the Court's approach became more prominent in A. Umarani vs. Registrar, Cooperative Societies [2004 (7) SCC 112], decided by a three-Judges Bench, wherein it was held that the State cannot invoke Article 162 of the Constitution of India for regularization of the appointments made in violation of the mandatory statutory provisions. In Secretary, State of Karnataka vs. Uma Devi (supra), the Constitution of India Bench again considered the question whether the State can frame scheme for regularization of the services of ad-hoc/temporary/daily wager appointed in violation of the doctrine of equality or the one appointed with a clear stipulation that such appointment will not confer any right on the appointee to seek regularization or absorption in the regular cadre and whether the Court can issue mandamus for regularization or absorption of such appointee and answered the same in negative. The Court adverted to the theme of constitutionalism in a system established in rule of law, expanded meaning given to the doctrine of equality in general and equality in the matter of employment in particular, multi-facet problems including the one relating to unwarranted fiscal burden on the public exchequer created on account of the directions given by the High Courts and this Court for regularization of the services of persons appointed on purely temporary or ad hoc basis or engaged on daily wages or as casual labourers, referred to about three dozen judgments including R.N. Nanjundappa vs. T. Thimmiah [1972 (1) SCC 409], Daily Rate Casual Labour vs. Union of India [1988 (1) SCC 122], Bhagwati Prasad vs. Delhi State Mineral Development Corporation [1990 (1) SCC 361], Dharwad District P.W.D. Literate Daily Wage Employees Association and others vs. State of Karnataka and others [1990 (2) SCC 396], State of Haryana vs. Piara Singh [1992 (4) SCC 118] and State of Punjab vs. Surinder Kumar [1992 (1) SCC 489] and held:

"47. When a person enters a temporary employment or gets engagement as a contractual or casual worker and the engagement is not based on a proper selection as recognised by the relevant rules or procedure, he is aware of the consequences of the appointment being temporary, casual or contractual in nature. Such a person cannot invoke the theory of legitimate expectation for being confirmed in the post when an appointment to the post could be made only by following a proper procedure for selection and in cases concerned, in consultation with the Public Service Commission.

Therefore, the theory of legitimate expectation cannot be successfully advanced by temporary, contractual or casual employees. It cannot also be held that the State has held out any promise while engaging these persons either to continue them where they are or to make them permanent. The State cannot constitutionally make such a promise. It is also obvious that the theory cannot be invoked to seek a positive relief of being made permanent in the post.

48. It was then contended that the rights of the employees thus appointed, under Articles 14 and 16 of the Constitution of India , are violated. It is stated that the State has treated the employees unfairly by employing them on less than minimum wages and extracting

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work from them for a pretty long period in comparison with those directly recruited who are getting more wages or salaries for doing similar work. The employees before us were engaged on daily wages in the department concerned on a wage that was made known to them. There is no case that the wage agreed upon was not being paid. Those who are working on daily wages formed a class by themselves, they cannot claim that they are discriminated as against those who have been regularly recruited on the basis of the relevant rules. No right can be founded on an employment on daily wages to claim that such employee should be treated on a par with a regularly recruited candidate, and made permanent in employment, even assuming that the principle could be invoked for claiming equal wages for equal work. There is no fundamental right in those who have been employed on daily wages or temporarily or on contractual basis, to claim that they have a right to be absorbed in service. As has been held by this Court, they cannot be said to be holders of a post, since, a regular appointment could be made only by making appointments consistent with the requirements of Articles 14 and 16 of the Constitution of India . The right to be treated equally with the other employees employed on daily wages, cannot be extended to a claim for equal treatment with those who were regularly employed. That would be treating unequals as equals. It cannot also be relied on to claim a right to be absorbed in service even though they have never been selected in terms of the relevant recruitment rules. The arguments based on Articles 14 and 16 of the Constitution of India are therefore overruled.

49. It is contended that the State action in not regularising the employees was not fair within the framework of the rule of law. The rule of law compels the State to make appointments as envisaged by the Constitution of India and in the manner we have indicated earlier. In most of these cases, no doubt, the employees had worked for some length of time but this has also been brought about by the pendency of proceedings in tribunals and courts initiated at the instance of the employees. Moreover, accepting an argument of this nature would mean that the State would be permitted to perpetuate an illegality in the matter of public employment and that would be a negation of the constitutional scheme adopted by us, the people of India. It is therefore not possible to accept the argument that there must be a direction to make permanent all the persons employed on daily wages. When the court is approached for relief by way of a writ, the court has necessarily to ask itself whether the person before it had any legal right to be enforced. Considered in the light of the very clear constitutional scheme, it cannot be said that the employees have been able to establish a legal right to be made permanent even though they have never been appointed in terms of the relevant rules or in adherence of Articles 14 and 16 of the Constitution of India ."

53. In paragraph 25, the Constitution of India Bench specifically referred to the conclusions recorded in paragraphs 45 to 50 of the judgment in State of Haryana vs. Piara Singh (supra) and observed:

"26. With respect, why should the State be allowed to depart from the normal rule and indulge in temporary employment in permanent posts? This Court, in our view, is bound to insist on the State making regular and proper recruitments and is bound not to encourage or shut its eyes to the persistent transgression of the rules of regular

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recruitment. The direction to make permanent--the distinction between regularisation and making permanent, was not emphasized here--can only encourage the State, the model employer, to flout its own rules and would confer undue benefits on a few at the cost of many waiting to compete. With respect, the direction made in para 50 (of SCC) of Piara Singh is to some extent inconsistent with the conclusion in para 45 (of SCC) therein. With great respect, it appears to us that the last of the directions clearly runs counter to the constitutional scheme of employment recognised in the earlier part of the decision. Really, it cannot be said that this decision has laid down the law that all ad hoc, temporary or casual employees engaged without following the regular recruitment procedure should be made permanent."

54. In paragraph 54, the Constitution of India Bench clarified that the earlier decisions which run counter to the principles settled by it will stand denuded of their status as precedents.55. In Jawaharlal Nehru Technological University vs. T. Sumalatha (Smt.) and others [2003 (10) SCC 405], a two-Judges Bench considered an issue somewhat similar to the one being considered in these appeals. The facts of that case show that the respondents, who were graduates, were appointed as investigators on consolidated pay between 1985 and 1991 in the Nodal Centre set up in the University under the scheme known as the National Technical Manpower Information System sponsored by the then Ministry of Education and Culture, Government of India. The Nodal Centre was financed entirely by the Ministry of Education and Culture, Government of India. Initially, the term of the Nodal Centre was 1 year and 9 months, but it was continued thereafter. The respondents were appointed for 89 days but their services were extended from time to time on similar terms. Their consolidated pay was also revised twice. They filed writ petition claiming regularization of service in the University. Some directions were issued by the High Court for consideration of the cases of the respondents for absorption. The University declined their prayer. In the second round of litigation, the High Court directed the University to absorb the respondents by applying GO No.212 dated 22.4.1994 issued by the State Government for regularization of the services of temporary/ad hoc/daily wage employees of the Government departments. While reversing the order of the High Court, this Court referred to GO No.212 and held :

"7. Can it be said that by virtue of this provision, the State Government assumes the responsibility of absorbing the staff employed in the organizations or establishments with which it has no administrative or financial nexus, merely because an instrumentality of the State is involved in managing it, that too, in a limited sense? The answer could only be in the negative. When the State Government or its instrumentalities have not created the posts on their own and do not bear any part of the financial burden, the question of getting the clearance from the Finance and Planning Department of the Government for the purpose of regularization or absorption does not arise. Viewed from any angle, GO No. 212 would be wholly out of place for those working in the nodal centre which is created and nurtured by the Central Government. It is not within the domain of the State Government or even the University to regulate the staff pattern or the monetary benefits of the staff working therein, without the approval of the Central Government. Therefore,

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no directions should have been issued to the State Government or to the University to regularize the services of Respondents 1 to 5, if necessary, by creating additional posts."

56. After rejecting the plea of the respondents for regularization of service, this Court adverted to the issue of increase in their salary and held :

"9. Though the plea of regularization in respect of any of the fifth respondents cannot be countenanced, the respondent employees should have a fair deal consistent with the guarantee enshrined in Articles 21 and 14 of the Constitution of India. They should not be made to work on a meager salary for years together. It would be unfair and unreasonable to extract work from the employees who have been associated with the nodal centre almost from its inception by paying them remuneration which, by any objective standards, is grossly low. The Central Government itself has rightly realized the need to revise the consolidated salary and accordingly enhanced the grant on that account on two occasions. That revision was made more than six years back. It is high time that another revision is made. It is therefore imperative that the Ministry concerned of the Union of India should take expeditious steps to increase the salary of the investigators viz. Respondents 1 to 4 working in the nodal centre in Hyderabad. In the absence of details regarding the nature of work done by the said respondents and the equivalence of the job done by them to the other posts prevailing in the University or the Central Government institutions, we are not in a position to give any direction based on the principle of "equal pay for equal work". However, we consider it just and expedient to direct Respondent 7 or 8, as the case may be, to take an expeditious decision to increase the consolidated salary that is being paid to Respondents 1 to 4 to a reasonable level commensurate with the work done by them and keeping in view the minimum salary that is being paid to the personnel doing a more or less similar job. As far as the fifth respondent is concerned, though we refrain from giving similar directions in view of the fact that the post is not specifically sanctioned under the Scheme, we would like to observe that the Central Government may consider increasing the quantum of office expenditure suitably so that the University will be able to disburse higher salary to the fifth respondent." [Emphasis supplied]

57. By virtue of Article 141 of the Constitution of India, the judgment of the Constitution of India Bench in Secretary, State of Karnataka vs. Uma Devi (supra) is binding on all the courts including this Court till the same is overruled by a larger Bench. The ratio of the Constitution of India Bench judgment has been followed by different two-Judges Benches for declining to entertain the claim of regularization of service made by ad hoc/temporary/ daily wage/casual employees or for reversing the orders of the High Court granting relief to such employees - Indian Drugs and Pharamaceuticals Ltd. vs. Workmen [2007 (1) SCC 408], Gangadhar Pillai vs. Siemens Ltd. [2007 (1) SCC 533], Kendriya Vidyalaya Sangathan vs. L.V. Subramanyeswara [2007 (5) SCC 326], Hindustan Aeronautics Ltd. vs. Dan Bahadur Singh [2007 (6) SCC 207]. However, in U.P. SEB vs. Pooran Chand Pandey [2007 (11) SCC 92] on which reliance has been placed by Shri Gupta, a two-Judges Bench has attempted to dilute the Constitution of India Bench judgment by suggesting that the said decision cannot be applied to a case where regularization has been sought for in pursuance of Article 14 of the Constitution of

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India and that the same is in conflict with the judgment of the seven-Judges Bench in Maneka Gandhi vs. Union of India [1978 (1) SCC 248].

58. The facts of U.P. SEB vs. Pooran Chand Pandey (supra) were that the respondents (34 in number) were employed as daily wage employees by the Cooperative Electricity Supply Society in 1985. The Society was taken over by Uttar Pradesh Electricity Supply Board in 1997 along with daily wage employees. Earlier to this, the Electricity Board had taken a policy decision on 28.11.1996 to regularize the services of its employees working on daily wages from before 4.5.1990, subject to their passing the examination. The respondents moved the High Court claiming benefit of the policy decision dated 28.11.1996. The learned Single Judge of the High Court held that once the employees of the society became employees of the Electricity Board, there was no valid ground to discriminate them in the matter of regularization of service. The Division Bench approved the order of the Single Bench. A two-Judges Bench of this Court dismissed the appeal of the Electricity Board. In para 11 of its judgment, the two-Judges Bench distinguished Secretary, State of Karnataka vs. Uma Devi (supra) by observing that the ratio of that judgment cannot be applied to a case where regularization has been sought for in pursuance of Article 14 of the Constitution of India. The two-Judges Bench then referred to State of Orissa vs. Sudhanshu Sekhar Misra [AIR 1968 SC 647], State of Gujarat vs. Ambica Quarry Works [1987 (1) SCC 213], Bhavnagar University vs. Palitana Sugar Mill Pvt. Ltd. [2003 (2) SCC 111], Bharat Petroleum Ltd. vs. N.R. Viramani [2004 (8) SCC 579] and observed:

"We are constrained to refer to the above decisions and principles contained therein because we find that often Umadevi (3) case is being applied by courts mechanically as if it were a Euclid's formula without seeing the facts of a particular case. As observed by this Court in Bhavnagar University and Bharat Petroleum Corpn. Ltd. a little difference in facts or even one additional fact may make a lot of difference in the precedential value of a decision. Hence, in our opinion, Umadevi (3) case cannot be applied mechanically without seeing the facts of a particular case, as a little difference in facts can make Umadevi (3) case inapplicable to the facts of that case.""We may further point out that a seven-Judge Bench decision of this Court in Maneka Gandhi vs. Union of India has held that reasonableness and non-arbitrariness is part of Article 14 of the Constitution of India. It follows that the Government must act in a reasonable and non-arbitrary manner otherwise Article 14 of the Constitution of India would be violated. Maneka Gandhi case is a decision of a seven-Judge Bench, whereas Umadevi (3) case is a decision of a five-Judge Bench of this Court. It is well settled that a smaller Bench decision cannot override a larger Bench decision of the Court. No doubt, Maneka Gandhi case does not specifically deal with the question of regularisation of government employees, but the principle of reasonableness in executive action and the law which it has laid down, in our opinion, is of general application."[Emphasis supplied]

59. We have carefully analyzed the judgment of the two-Judges Bench and are of the considered view that the above reproduced observations were not called for. The only issue which fell for consideration by two-Judges Bench was whether the daily wage

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employees of the society, the establishment of which was taken over by the Electricity Board along with the employees, were entitled to be regularized in terms of the policy decision taken by the Board and whether the High Court committed an error by invoking Article 14 of the Constitution of India for granting relief to the writ petitioners. The question whether the Electricity Board could frame such a policy was neither raised nor considered by the High Court and this Court. The High Court simply adverted to the facts of the case and held that once the daily wage employees of the society became employees of the Electricity Board, they could not be discriminated in the matter of implementation of the policy of regularization. Therefore, the two-Judges Bench had no occasion to make any adverse comment on the binding character of the Constitution of India Bench judgment in Secretary, State of Karnataka vs. Uma Devi (supra).

60. There have been several instances of different Benches of the High Courts not following the judgments/orders of coordinate and even larger Benches. In some cases, the High Courts have gone to the extent of ignoring the law laid down by this Court without any tangible reason. Likewise, there have been instances in which smaller Benches of this Court have either ignored or bypassed the ratio of the judgments of the larger Benches including the Constitution of India Benches. These cases are illustrative of non-adherence to the rule of judicial discipline which is sine qua non for sustaining the system. In Mahadeolal Kanodia vs. Administrator General of W.B. [1960 (3) SCR 578], this Court observed:

"If one thing is more necessary in law than any other thing, it is the quality of certainty. That quality would totally disappear if Judges of coordinate jurisdiction in a High Court start overruling one another's decisions. If one Division Bench of a High Court is unable to distinguish a previous decision of another Division Bench, and holding the view that the earlier decision is wrong, itself gives effect to that view the result would be utter confusion. The position would be equally bad where a Judge sitting singly in the High Court is of opinion that the previous decision of another Single Judge on a question of law is wrong and gives effect to that view instead of referring the matter to a larger Bench. In such a case lawyers would not know how to advise their clients and all courts subordinate to the High Court would find themselves in an embarrassing position of having to choose between dissentient judgments of their own High Court."[Emphasis added]

61. In Lala Shri Bhagwan vs. Ram Chandra [AIR 1965 SC 1767], Gajendragadkar, C.J. observed :

"It is hardly necessary to emphasize that considerations of judicial propriety and decorum require that if a learned Single Judge hearing a matter is inclined to take the view that the earlier decisions of the High Court, whether of a Division Bench or of a Single Judge, need to be reconsidered, he should not embark upon that enquiry sitting as a Single Judge, but should refer the matter to a Division Bench or, in a proper case, place the relevant papers before the Chief Justice to enable him to constitute a larger bench to examine the question. That is the proper and traditional way to deal with such mattes and it is founded on healthy principles of judicial decorum and propriety. It is to

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be regretted that the learned Single Judge departed from this traditional way in the present case and chose to examine the question himself."

62. In Union of India vs. Raghubir Singh [1989 (2) SCC 754], R.S. Pathak, C.J. while recognizing need for constant development of law and jurisprudence emphasized the necessity of abiding by the earlier precedents in following words :

"The doctrine of binding precedent has the merit of promoting a certainty and consistency in judicial decisions, and enables an organic development of law, besides providing assurance to the individual as to the consequence of transaction forming part of his daily affairs. And, therefore, the need for a clear and consistent enunciation of legal principle in the decisions of a court."

63. In Sundarjas Kanyalal Bhatija and others vs. Collector, Thane [1989 (3) SCC 396], a two- Judges Bench observed as under :

"In our system of judicial review which is a part of our constitutional scheme, we hold it to be the duty of judges of superior courts and tribunals to make the law more predictable. The question of law directly arising in the case should not be dealt with apologetic approaches. The law must be made more effective as a guide to behaviour.

It must be determined with reasons which carry convictions within the courts, profession and public. Otherwise, the lawyers would be in a predicament and would not know how to advise their clients. Sub-ordinate courts would find themselves in an embarrassing position to choose between the conflicting opinion. The general public would be in dilemma to obey or not to obey such law and it ultimately falls into disrepute."

64. In Dr. Vijay Laxmi Sadho vs. Jagdish [2001 (2) SCC 247], this Court considered whether the learned Single Judge of Madhya Pradesh High Court could ignore the judgment of a coordinate Bench on the same issue and held :

"33. As the learned Single Judge was not in agreement with the view expressed in Devilal case it would have been proper, to maintain judicial discipline, to refer the matter to a larger Bench rather than to take a different view. We note it with regret and distress that the said course was not followed. It is well-settled that if a Bench of coordinate jurisdiction disagrees with another Bench of coordinate jurisdiction whether on the basis of "different arguments" or otherwise, on a question of law, it is appropriate that the matter be referred to a larger Bench for resolution of the issue rather than to leave two conflicting judgments to operate, creating confusion. It is not proper to sacrifice certainty of law. Judicial decorum, no less than legal propriety forms the basis of judicial procedure and it must be respected at all costs."

65. In Pradip Chandra Parija and others vs. Pramod Chandra Patnaik and others [2002 (1) SCC 1], the Constitution of India Bench noted that the two learned Judges denuded the correctness of an earlier Constitution of India Bench judgment in Bharat Petroleum Corpn. Ltd. vs. Mumbai Shramik Sangha [2001 (4) SCC 448] and reiterated the same

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despite the fact that the second Constitution of India Bench refused to reconsider the earlier verdict and observed :

"3. We may point out, at the outset, that in Bharat Petroleum Corpn. Ltd. v. Mumbai Shramik Sangha(2001 (4) SCC 448) a Bench of five Judges considered a somewhat similar question. Two learned Judges in that case doubted the correctness of the scope attributed to a certain provision in an earlier Constitution of India Bench judgment and, accordingly, referred the matter before them directly to a Constitution of India Bench. The Bench that then heard the matter took the view that the decision of a Constitution of India Bench binds a Bench of two learned Judges and that judicial discipline obliges them to follow it, regardless of their doubts about its correctness. At the most, the Bench of two learned Judges could have ordered that the matter be heard by a Bench of three learned Judges.

5. The learned Attorney-General submitted that a Constitution of India Bench judgment of this Court was binding on smaller Benches and a judgment of three learned Judges was binding on Benches of two learned Judges -- a proposition that learned counsel for the appellants did not dispute. The learned Attorney-General drew our attention to the judgment of a Constitution of India Bench in Sub-Committee of Judicial Accountability v. Union of India (1992 (4) SCC 97) where it has been said that "no coordinate Bench of this Court can even comment upon, let alone sit in judgment over, the discretion exercised or judgment rendered in a cause or matter before another coordinate Bench" (SCC p. 98, para 5). The learned Attorney-General submitted that the appropriate course for the Bench of two learned Judges to have adopted, if it felt so strongly that the judgment in Nityananda Kar (1991 Supp. (2) SCC 506) was incorrect, was to make a reference to a Bench of three learned Judges. That Bench of three learned Judges, if it also took the same view of Nityananda Kar, could have referred the case to a Bench of five learned Judges.

6. In the present case the Bench of two learned Judges has, in terms, doubted the correctness of a decision of a Bench of three learned Judges. They have, therefore, referred the matter directly to a Bench of five Judges. In our view, judicial discipline and propriety demands that a Bench of two learned Judges should follow a decision of a Bench of three learned Judges. But if a Bench of two learned Judges concludes that an earlier judgment of three learned Judges is so very incorrect that in no circumstances can it be followed, the proper course for it to adopt is to refer the matter before it to a Bench of three learned Judges setting out, as has been done here, the reasons why it could not agree with the earlier judgment. If, then, the Bench of three learned Judges also comes to the conclusion that the earlier judgment of a Bench of three learned Judges is incorrect, reference to a Bench of five learned Judges is justified.[Emphasis supplied]

66. In State of Bihar vs. Kalika Kuer and others [2003 (5) SCC 448], the Court elaborately considered the principle of per incuriam and held that the earlier judgment by a larger Bench cannot be ignored by invoking the principle of per incuriam and the only course open to the coordinate or smaller Bench is to make a request for reference to

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the larger Bench. In State of Punjab vs. Devans Modern Breweries Ltd. [2004 (11) SCC 26], the Court reiterated that if a coordinate Bench does not agree with the principles of law enunciated by another Bench, the matter has to be referred to a larger Bench. In Central Board of Dwaoodi Bohra Community vs. State of Maharashtra [2005 (2) SCC 673], the Constitution of India Bench interpreted Article 141, referred to various earlier judgments including Bharat Petroleum Corpn. Ltd. vs. Mumbai Shramik Sangha (supra), Pradip Chandra Parija and others vs. Pramod Chandra Patnaik and others (supra) and held that "the law laid down in a decision delivered by a Bench of larger strength is binding on any subsequent Bench of lesser or co-equal strength and it would be inappropriate if a Division Bench of two Judges starts overruling the decisions of Division Benches of three Judges. The Court further held that such a practice would be detrimental not only to the rule of discipline and the doctrine of binding precedents but it will also lead to inconsistency in decisions on the point of law; consistency and certainty in the development of law and its contemporary status - both would be immediate casualty"

67. In State of U.P. and others vs. Jeet S. Bisht and another [2007 (6) SCC 586], when one of the Hon'ble Judges (Katju, J.) constituting the Bench criticized the orders passed by various Benches in the same case, the other Hon'ble Judge (Sinha, J.) expressed himself in the following words :

"100. For the views been taken herein, I regret to express my inability to agree with Brother Katju, J. in regard to the criticisms of various orders passed in this case itself by other Benches. I am of the opinion that it is wholly inappropriate to do so. One Bench of this Court, it is trite, does not sit in appeal over the other Bench particularly when it is a coordinate Bench. It is equally inappropriate for us to express total disagreement in the same matter as also in similar matters with the directions and observations made by the larger Bench. Doctrine of judicial restraint, in my opinion, applies even in this realm. We should not forget other doctrines which are equally developed viz. Judicial Discipline and respect for the Brother Judges."

68. In U.P. Gram Panchayat Adhikari Sangh vs. Daya Ram Saroj [2007 (2) SCC 138], the Court noted that by ignoring the earlier decision of a coordinate Bench, a Division Bench of the High Court directed that part-time tube-well operators should be treated as permanent employees with same service conditions as far as possible and observed :

"26. Judicial discipline is self-discipline. It is an inbuilt mechanism in the system itself. Judicial discipline demands that when the decision of a coordinate Bench of the same High Court is brought to the notice of the Bench, it is to be respected and is binding, subject of course, to the right to take a different view or to doubt the correctness of the decision and the permissible course then open is to refer the question or the case to a larger Bench. This is the minimum discipline and decorum to be maintained by judicial fraternity."

69. It is interesting to note that in Coir Board, Ernakulam vs. Indira Devi P.S. [1998 (3) SCC 259], a two-Judges Bench doubted the correctness of the seven-Judges Bench

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judgment in Bangalore Water Supply & Sewerage Board vs. A. Rajappa [1978 (2) SCC 213] and directed the matter to be placed before Hon'ble the Chief Justice of India for constituting a larger Bench. However, a three-Judges Bench headed by Dr. A.S. Anand, C.J., refused to entertain the reference and observed that the two-Judges Bench is bound by the judgment of the larger Bench - Coir Board, Ernakulam, Kerala State vs. Indira Devai P.S. [2000 (1) SCC 224].

70. We are distressed to note that despite several pronouncements on the subject, there is substantial increase in the number of cases involving violation of the basics of judicial discipline. The learned Single Judges and Benches of the High Courts refuse to follow and accept the verdict and law laid down by coordinate and even larger Benches by citing minor difference in the facts as the ground for doing so. Therefore, it has become necessary to reiterate that disrespect to constitutional ethos and breach of discipline have grave impact on the credibility of judicial institution and encourages chance litigation. It must be remembered that predictability and certainty is an important hallmark of judicial jurisprudence developed in this country in last six decades and increase in the frequency of conflicting judgments of the superior judiciary will do incalculable harm to the system inasmuch as the courts at the grass root will not be able to decide as to which of the judgment lay down the correct law and which one should be followed. We may add that in our constitutional set up every citizen is under a duty to abide by the Constitution of India and respect its ideals and institutions. Those who have been entrusted with the task of administering the system and operating various constituents of the State and who take oath to act in accordance with the Constitution of India and uphold the same, have to set an example by exhibiting total commitment to the Constitutional ideals. This principle is required to be observed with greater rigour by the members of judicial fraternity who have been bestowed with the power to adjudicate upon important constitutional and legal issues and protect and preserve rights of the individuals and society as a whole. Discipline is sine qua non for effective and efficient functioning of the judicial system. If the Courts command others to act in accordance with the provisions of the Constitution of India and rule of law, it is not possible to countenance violation of the constitutional principle by those who are required to lay down the law.

71. In the light of what has been stated above, we deem it proper to clarify that the comments and observations made by the two-Judges Bench in UP State Electricity Board vs. Pooran Chandra Pandey (supra) should be read as obiter and the same should neither be treated as binding by the High Courts, Tribunals and other judicial foras nor they should be relied upon or made basis for bypassing the principles laid down by the Constitution of India Bench.Equal Pay for Equal Work

72. The respondents' claim for fixation of pay in the regular scale and grant of other monetary benefits at par with those appointed against the sanctioned posts has been accepted by the High Courts on the premise that their duties and functions are similar to those performed by regular employees. In the opinion of the High Courts, similarity in the nature of work of the company paid staff on the one hand and regular employees on the other hand, is by itself sufficient for invoking the principle of equal pay for equal

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work, In our view, the approach adopted by the High Courts is clearly erroneous and directions given for bringing about parity between the company paid staff and regular employees in the matter of pay, allowances etc. are liable to be upset.

73. The principle of equal pay for equal work for men and women embodied in Article 39(d) was first considered in Kishori Mohanlal Bakshi vs. Union of India [AIR 1962 SC 1139] and it was held that the said principle is not capable of being enforced in a Court of law. After 36 years, the issue was again considered in Randhir Singh Vs. Union of India (supra), and it was unequivocally ruled that the principle of equal pay for equal work is not an abstract doctrine and can be enforced by reading it into the doctrine of equality enshrined in Articles 14 and 16 of the Constitution Of India, 1950.

The ratio of Randhir Singh Vs. Union of India (supra) was reiterated and applied in several cases - Dhirendra Chamoli vs. State of U.P. (supra), Surinder Singh and Another vs. Engineer-in-Chief, CPWD and Others (supra), Daily Rated Casual Labour vs. Union of India (supra), Dharwad District P.W.D. Literate Daily Wage Employees' Association vs. State of Karnataka (supra) and Jaipal vs. State of Haryana [1988 (3) SCC 354] and it was held that even a daily wage employee who is performing duties similar to regular employees is entitled to the same pay. However, in Federation of All India Customs and Central Excise Stenographers (Recognized) Union vs. Union of India [1988 (3) SCC 91], Mewa Ram Kanojia vs. A.I.I.M.S. [1989 (2) SCC 235], V. Markandeya vs. State of A.P. [1989 (3) SCC 191], Harbans Lal and others vs. State of Himachal Pradesh and others [1989 (4) SCC 459], State of U.P. and others vs. J.P. Chaurasia and others [1989 (1) SCC 121], Griha Kalyan Workers' Union vs. Union of India [1991 (1) SCC 619], Ghaziabad Development Authority vs. Vikram Chaudhary [1995 (5) SCC 210], State of Haryana and others vs. Jasmer Singh and others [1996 (11) SCC 77], State of Haryana vs. Surinder Kumar [1997 (3) SCC 633], Union of India vs. K.V. Baby [1998 (9) SCC 252], State of Orissa vs. Balram Sahu [2003 (1) SCC 250], Utkal University vs. Jyotirmayee Nayak [2003 (4) SCC 760], State of Haryana and another vs. Tilak Raj and others [2003 (6) SCC 123], Union of India vs. Tarit Ranjan Das [2003 (11) SCC 658], Apangshu Mohan Lodh vs. State of Tripura [2004 (1) SCC 119], State of Haryana vs. Charanjit Singh [2006 (9) SCC 321], Hindustan Aeronautics Ltd. vs. Dan Bahadur Singh (supra), Kendriya Vidyalaya Sangathan vs. L.V. Subramanyeswara (supra) and Canteen Mazdoor Sabha vs. Metallurgical & Engineering Consultants (India) Ltd. [2007 (7) SCC 710], the Court consciously and repeatedly deviated from the ruling of Randhir Singh Vs. Union of India (supra) and held that similarity in the designation or quantum of work are not determinative of equality in the matter of pay scales and that before entertaining and accepting the claim based on the principle of equal pay for equal work, the Court must consider the factors like the source and mode of recruitment/appointment, the qualifications, the nature of work, the value judgment, responsibilities, reliability, experience, confidentiality, functional need etc.

In State of Haryana and others vs. Jasmer Singh and others (supra), the two-Judges Bench laid down the following principle :

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"8. It is, therefore, clear that the quality of work performed by different sets of persons holding different jobs will have to be evaluated. There may be differences in educational or technical qualifications which may have a bearing on the skills which the holders bring to their job although the designation of the job may be the same. There may also be other considerations which have relevance to efficiency in service which may justify differences in pay scales on the basis of criteria such as experience and seniority, or a need to prevent stagnation in the cadre, so that good performance can be elicited from persons who have reached the top of the pay scale. There may be various other similar considerations which may have a bearing on efficient performance in a job. This Court has repeatedly observed that evaluation of such jobs for the purposes of pay scale must be left to expert bodies and, unless there are any mala fides, its evaluation should be accepted."

74. In Harbans Lal and others vs. State of Himachal Pradesh and others (supra), the Court held that the claim of carpenters employed by an incorporated company for party in wages payable to their counterparts in Government service is unsustainable. In Jawaharlal Nehru Technological University vs. T. Sumalatha (Smt.) and others (supra), it was held that the respondents who were employed under a scheme known as National Technical Manpower Information System, which was sponsored by the then Ministry of Education and Culture, cannot claim parity with the regular Government employees in the matter of pay scale.

75. In Canteen Mazdoor Sabha vs. Metallurgical & Engineering Consultants (India) Ltd. (supra), another two-Judges Bench held that simply because some employees of a contractor of the alleged head employer are performing the task or duties similar to the employees of the head employer, it will not entitle such employees to claim parity.

76. As mentioned earlier, the respondents were employed/engaged by the Official Liquidators pursuant to the sanction accorded by the Court under Rule 308 of the 1959 Rules and they are paid salaries and allowances from the company fund. They were neither appointed against sanctioned posts nor they were paid out from the Consolidated Fund of India. Therefore, the mere fact that they were doing work similar to the regular employees of the office of the Official Liquidators cannot be treated as sufficient for applying the principle of equal pay for equal work. Any such direction will compel the Government to sanction additional posts in the offices of the Official Liquidators so as to facilitate payment of salaries and allowances to the company paid staff in the regular pay scale from the Consolidate Fund of India and in view of our finding that the policy decision taken by the Government of India to reduce the number of posts meant for direct recruitment does not suffer from any legal or constitutional infirmity, it is not possible to entertain the plea of the respondents for payment of salaries and allowances in the regular pay scales and other monetary benefits at par with regular employees by applying the principle of equal pay for equal work.Legitimate Expectation

77. We shall now advert to the question whether the respondents can invoke the doctrine of legitimate expectation for supporting the impugned orders. This part of the

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respondent's claim is founded on their assertion that notwithstanding the contrary stipulation contained in the orders of appointment, they had expected that in view of the 1978 Scheme the Government will absorb them in the regular cadres on some future date and give benefit of the principle of equal pay for equal work. The argument of Shri Bhaskar P. Gupta and Ms. Jyoti Mendiratta is that the respondents had joined as company paid staff with the hope that they will be absorbed in the Government service, but their hopes have been totally belied because instead of creating adequate number of posts for absorption of company paid staff in accordance with the 1999 Scheme, the Government has arbitrarily abolished large number of posts in direct recruitment quota and on that account, even those who have been adjudged suitable will never get absorbed in the regular cadres. In our opinion, there is no merit in this argument. The pleadings of the parties and records produced before the High Courts and this Court do not show that any competent authority of the Government of India had ever given any assurance much less made a promise to the respondents that they will get absorbed against the sanctioned posts or that there will be no abolition of posts meant to be filled by direct recruitment. As a matter of fact, the respondents joined as company paid staff knowing fully well that they were being employed as additional staff in connection with the liquidation proceedings and on the basis of sanction accorded by the concerned Court and further that they will have no right to seek absorption. They also knew that their employment will come to an end on the expiry of the tenure specified in the letter/order of appointment or on cessation of the liquidation proceedings. In this scenario, the doctrine of legitimate expectation cannot be invoked for sustaining the directions given by the High Courts for absorption of all company paid staff with consequential benefits or for nullifying the policy decision taken by the Government to gradually reduce the direct recruitment quota.

78. The concept of "due process of law" has played a major role in the development of administrative law. It ensures fairness in public administration. The administrative authorities who are entrusted with the task of deciding lis between the parties or adjudicating upon the rights of the individuals are duty bound to comply with the rules of natural justice, which are multifaceted. The absence of bias in the decision making process and compliance of audi alteram partem are two of these facets. The doctrine of legitimate expectation is a nacent addition to the rules of natural justice. It goes beyond statutory rights by serving as another device for rendering justice. At the root of the principle of legitimate expectation is the constitutional principle of rule of law, which requires regularity, predictability and certainty in government's dealings with the public - J. Raz, The Authority of Law [(1979) Ch. 11]. The 'legal certainty' is also a basic principle of European Community. European law is based upon the concept of "vertrauensschutz" (the honouring of a trust or confidence). It is for these reasons that the existence of a legitimate expectation may even in the absence of a right of private law, justify its recognition in public law.

79. In Halsbury's laws of England (Fourth Edition), the doctrine of legitimate expectation has been described in the following words :

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"A person may have a legitimate expectation of being treated in a certain way by an administrative authority even though he has no legal right in private law to receive such treatment. The expectation may arise either from a representation or promise made by the authority, including an implied representation, or from consistent past practice."

80. A formal statement on the doctrine of legitimate expectation can be found in the judgment of House of Lords in Council of Civil Services Union vs. Minister of the Civil Service [1985 AC 374 (HL]. In that case the Government tried to forbid trade unionism among civil service. For this, Civil Service Order-in-1982 Council was issued. The Court of appeal declared that the Minister had acted unlawfully in abridging the fundamental right of a citizen to become a member of the trade union. The House of Lords approved the judgment of the Court of appeal and held that such a right could not be taken away without consulting the concerned civil servant.

81. In India, the Courts have gradually recognized that while administering the affairs of the State, the Government and its departments are expected to honour the policy statements and treat the citizens without any discrimination. The theory of legitimate expectation first found its mention in Navjyoti Coop. Group Housing Society vs. Union of India [1992 (4) SCC 477]. In that case the right of a housing society for right to priority in the matter of registration was recognized in the following words :

"... In the aforesaid facts, the Group Housing Societies were entitled to 'legitimate expectation' of following consistent past practice in the matter of allotment, even though they may not have any legal right in private law to receive such treatment. The existence of 'legitimate expectation' may have a number of different consequences and one of such consequences is that the authority ought not to act to defeat the 'legitimate expectation' without some overriding reason of public policy to justify its doing so. In a case of 'legitimate expectation' if the authority proposes to defeat a person's 'legitimate expectation' it should afford him an opportunity to make representations in the matter. In this connection reference may be made to the discussions on 'legitimate expectation' at page 151 of Volume 1(1) of Halsbury's Laws of England -- Fourth Edition (re-issue). We may also refer to a decision of the House of Lords in Council of Civil Service Unions v. Minister for the Civil Service. It has been held in the said decision that an aggrieved person was entitled to judicial review if he could show that a decision of the public authority affected him of some benefit or advantage which in the past he had been permitted to enjoy and which he legitimately expected to be permitted to continue to enjoy either until he was given reasons for withdrawal and the opportunity to comment on such reasons. It may be indicated here that the doctrine of 'legitimate expectation' imposes in essence a duty on public authority to act fairly by taking into consideration all relevant factors relating to such 'legitimate expectation'. Within the conspectus of fair dealing in case of 'legitimate expectation', the reasonable opportunities to make representation by the parties likely to be affected by any change of consistent past policy, come in. We have not been shown any compelling reasons taken into consideration by the Central Government to make a departure from the existing policy of allotment with reference to seniority in Registration by introducing a new guideline." (emphasis supplied)

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82. In Food Corporation of India vs. Kamdhenu Cattle Feed Industries [1993 (1) SCC 71], this Court considered whether rejection of the tender of the respondent was vitiated by arbitrariness.The claim of the respondents was negated in the following words :

"In the contractual sphere as in all other State actions, the State and all its instrumentalities have to conform to article 14 of the Constitution of India of which non- arbitrariness is a significant facet. There is no unfettered discretion in public law : A public authority possesses powers only to use them for public good. This imposes the duty to act fairly and to adopt a procedure which is 'fairplay in action'. Due observance of this obligation as a part of good administration raises a reasonable or legitimate expectation in every citizen to be treated fairly in his interaction with the State and its instrumentalities, with this element forming a necessary component of the decision making process in all State actions. To satisfy this requirement of non- arbitrariness in a State action, it is, therefore, necessary to consider and give due weight to the reasonable or legitimate expectations of the persons likely to be affected by the decision or else that unfairness in the exercise of the power may amount to an abuse or excess of power apart from affecting the bona fides of the decision in a given case. The decision so made would be exposed to challenge on the ground of arbitrariness. The rule of law does not completely eliminate discretion in the exercise of power, as it is unrealistic, but provides for control of its exercise of by judicial review.

The mere reasonable or legitimate expectation of a citizen, in such a situation, may not by itself be a distinct enforceable right, but failure to consider and give due weight to it may render the decision arbitrary, and this is how the requirement of due consideration of a legitimate expectation forms part of the principle of non- arbitrariness, a necessary concomitant of the rule of law. Every legitimate expectation is a relevant factor requiring due consideration in a fair decision-making process. Whether the expectation of the claimant is reasonable or legitimate in the context is a question of fact in each case. Whenever the question arises, it is to be determined not according to the claimant's perception but in larger public interest wherein other more important considerations may outweigh what would otherwise have been the legitimate expectation of the claimant. A bona fide decision of the public authority reached in this manner would satisfy the requirement of non- arbitrariness and withstand judicial scrutiny. The doctrine of legitimate expectation gets assimilated in the rule of law and operates in our legal system in this manner and to this context." [Emphasis supplied]

83. In Union of India and others vs. Hindustan Development Corporation and others [1993 (3) SCC 499] this Court considered the doctrine of legitimate expectation and held :

"For legal purposes, the expectation cannot be the same as anticipation. It is different from a wish, a desire or a hope nor can it amount to a claim or demand on the ground of a right. However earnest and sincere a wish, a desire or a hope may be and however confidently one may look to them to be fulfilled, they by themselves cannot amount to an

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assertable expectation and a mere disappointment does not attract legal consequences. A pious hope even leading to a moral obligation cannot amount to a legitimate expectation. The legitimacy of an expectation can be inferred only if it is founded on the sanction of law or custom or an established procedure followed in regular and natural sequence. Again it is distinguishable from a genuine expectation. Such expectation should be justifiably legitimate and protectable. Every such legitimate expectation does not by itself fructify into a right and therefore it does not amount to a right in the conventional sense." ' [Emphasis supplied]

84. In Punjab Communications Ltd. vs. Union of India [1999 (4) SCC 727], the Court observed as under :

"The principle of 'legitimate expectation' is still at a stage of evolution. The principle is at the root of the rule of law and requires regularity, predictability and certainty in the Government's dealings with the public. The procedural part of it relates to a representation that a hearing or other appropriate procedure will be afforded before the decision is made. ...However, the more important aspect is whether the decision-maker can sustain the change in policy by resort to Wednesbury principles of rationality or whether the court can go into the question whether the decision-maker has properly balanced the legitimate expectation as against the need for a change. ... In sum, this means that the judgment whether public interest overrides the substantive legitimate expectation of individuals will be for the decision-maker who has made the change in the policy.

The choice of the policy is for the decision-maker and not for the court. The legitimate substantive expectation merely permits the court to find out if the change in policy which is the cause for defeating the legitimate expectation is irrational or perverse or one which no reasonable person could have made." (emphasis in original)

85. In J.P. Bansal Vs. State of Rajasthan [2003 (5) SCC 134], this Court refused to invoke the doctrine of legitimate expectation in favour of the appellant who claimed compensation of pre- mature termination of the contractual appointment as Judicial Member of the Rajasthan Taxation Appellate Tribunal.

86. In Dr. Chanchal Goyal (Mrs.) vs. State of Rajasthan [2003 (3) SCC 485], the appellants claim for absorption in the regular cadre/regularization of service was rejected by the High Court. While approving the orders of the Single and Division Benches of the High Court, this Court observed :

"23. On the facts of the case delineated above, the principle of legitimate expectation has no application. It has not been shown as to how any act was done by the authorities which created an impression that the conditions attached in the original appointment order were waived. Mere continuance does not imply such waiver. No legitimate expectation can be founded on such unfounded impressions. It was not even indicated as to who, if any, and with what authority created such impression. No waiver which would be against requisite compliances can be countenanced. Whether an expectation exists is,

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self-evidently, a question of fact. Clear statutory words override any expectation, however founded."

87. In Secretary, State of Karnataka vs. Uma Devi (supra), the Constitution of India Bench referred to the claim of the employees based on the doctrine of legitimate expectation and observed as under :

"The doctrine can be invoked if the decisions of the administrative authority affect the person by depriving him of some benefit or advantage which either (i) he had in the past been permitted by the decision-maker to enjoy and which he can legitimately expect to be permitted to continue to do until there have been communicated to him some rational grounds for withdrawing it on which he has been given an opportunity to comment; or (ii) he has received assurance from the decision-maker that they will not be withdrawn without giving him first an opportunity of advancing reasons for contending that they should not be withdrawn."

88. In Kuldeep Singh vs. Govt. of NCT of Delhi [2006 (5) SCC 702], the Court refused to invoke the doctrine of legitimate expectation to nullify the revised policy decision taken by the Government not to grant fresh liquor licenses.

89. In Ram Pravesh Singh vs. State of Bihar [2006 (8) SCC 381], a two-Judges Bench considered the question whether the employees of Futwah Phulwarisharif Gramya Vidyut Sahakari Samiti Ltd., which was a cooperative society, could claim absorption in the services of Bihar State Electricity Board by invoking the doctrine of legitimate expectation. The facts of that case show that the society was brought into existence by the State Government, the Electricity Board and the Rural Electrification Corporation for effective implementation of Rural Electrification Scheme meant for better distribution of electricity to rural areas, but the license of the society was revoked in the year 1995 and the Board refused to absorb the employees of the society. The learned Single Judge and Division Bench of the High Court declined to interfere with the decision of the Board.

This Court dismissed the appeal of the employees and observed :

"What is legitimate expectation? Obviously, it is not a legal right. It is an expectation of a benefit, relief or remedy, that may ordinarily flow from a promise or established practice. The term "established practice" refers to a regular, consistent, predictable and certain conduct, process or activity of the decision-making authority. The expectation should be legitimate, that is, reasonable, logical and valid. Any expectation which is based on sporadic or casual or random acts, or which is unreasonable, illogical or invalid cannot be a legitimate expectation. Not being a right, it is not enforceable as such. It is a concept fashioned by the courts, for judicial review of administrative action. It is procedural in character based on the requirement of a higher degree of fairness in administrative action, as a consequence of the promise made, or practice established. In short, a person can be said to have a "legitimate expectation" of a particular treatment, if any representation or promise is made by an authority, either expressly or impliedly, or if the regular and consistent past practice of the authority gives room for such expectation in

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the normal course. As a ground for relief, the efficacy of the doctrine is rather weak as its slot is just above "fairness in action" but far below "promissory estoppel". It may only entitle an expectant: (a) to an opportunity to show cause before the expectation is dashed; or (b) to an explanation as to the cause for denial. In appropriate cases, the courts may grant a direction requiring the authority to follow the promised procedure or established practice. A legitimate expectation, even when made out, does not always entitle the expectant to a relief. Public interest, change in policy, conduct of the expectant or any other valid or bona fide reason given by the decision-maker, may be sufficient to negative the "legitimate expectation". The doctrine of legitimate expectation based on established practice (as contrasted from legitimate expectation based on a promise), can be invoked only by someone who has dealings or transactions or negotiations with an authority, on which such established practice has a bearing, or by someone who has a recognised legal relationship with the authority."

After noticing the judicial precedents on the subject, the Court held that employees of the erstwhile society cannot invoke the theory of legitimate expectation for compelling the Board to absorb them despite its precarious financial condition.

90. By applying the ratio of the aforementioned judgment to the facts of this case, we reiterate that the respondents cannot invoke the doctrine of legitimate expectation. At the cost of repetition, it needs to be emphasized that the respondents were employed by the Official Liquidators as additional staff pursuant to the sanction accorded by the concerned Courts. The conditions of their appointment clearly envisaged cessation of employment at the end of fixed tenure or on completion of liquidation proceedings. Of course, as it later turned out, the respondents were made to work in relation to different liquidation proceedings and for that purpose, the term of their employment/engagement was extended from time to time and they continued in service for many years in the same capacity. However, no material has been placed before this Court to show that any promise was made or any assurance was held out to the respondents by any competent authority of the Government of India for their absorption in the regular cadres. There is nothing in the language of Rule 308 of the 1959 Rules from which it can be inferred that those employed as additional staff in connection with the liquidation proceedings will, in future, be absorbed in the regular cadres. The 1978 as also the 1999 Schemes are merely illustrative of compassionate approach adopted by the Government of India for facilitating absorption of the company paid staff against the sanctioned posts to the extent of 50% vacancies in the direct recruitment quota. These schemes cannot be read as a charter for legitimating the claim of company paid staff to be absorbed in the Government service de hors availability of vacancies, more so when the Government has taken a rational policy decision to reduce direct recruitment to various services in a phased manner. In our opinion, any direction by the Court for absorption of all company paid staff would be detrimental to public interest in more than one ways. Firstly, it will compel the Government to abandon the policy decision of reducing the direct recruitment to various services. Secondly, this will be virtual abrogation of the statutory rules which envisages appointment to different cadres by direct recruitment.

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91. Before parting, we consider it necessary to take cognizance of the fact that in compliance of order passed by Calcutta High Court in Writ Petition No.211 of 2001, the Government of India created 51 posts for absorption of staff employed by the Court Liquidator. However, that cannot be made basis for granting relief to the respondents because creation of those posts was clouded by the threat of contempt, for which proceedings had been initiated by the aggrieved employees.92. On the basis of above discussion, we hold that –

(i) the respondents are not entitled to absorption against the sanctioned posts in Group C of the Department of Company Affairs, Government of India, as of right.(ii) The 1999 Scheme does not suffer from any legal or constitutional infirmity insofar as it provides for absorption of the company paid staff only to the extent of 50% vacancies in direct recruitment quota of Group C posts.

(iii) The decision taken by the Government of India to reduce the number of posts in direct recruitment quota and consequential abolition of posts in the Department of Company Affairs is not vitiated by arbitrariness or violation of the doctrine of equality or malafides.

(iv) The doctrine of legitimate expectation cannot be invoked for sustaining the directions given by the High Courts of Calcutta and Delhi for creation of supernumerary posts to facilitate absorption of all company paid staff in the regular cadres.

(v) The respondents are not entitled to have their pay fixed in the regular scales and other monetary benefits at par with regular employees working under the Official Liquidators.

93. Notwithstanding our conclusion that the directions given by the Calcutta and Delhi High Courts for absorption of company paid staff against Group C posts and grant of monetary benefits to them at par with regular employees of the Department of Company Affairs are legally unsustainable, we are inclined to accept the contention of the respondents that failure of the Government of India to frame scheme for absorption of Group D posts has resulted in invidious discrimination qua one section of the company paid staff. The appellants have not placed any material before this Court to show that the finding recorded by the learned Single Judge of Delhi High Curt that a number of persons were employed by the Official Liquidator in 1985 and thereafter who could be considered for absorption against Group D posts. This means that at the time of framing of the 1978 Scheme the existing company paid staff did not include the employees who could be absorbed on Group D posts and this appears to be the reason why the said scheme was confined to absorption of company paid staff against Group C posts. Since the employees who could be eligible for absorption on Group D posts were appointed in 1985 and thereafter, the Government of India should have, while framing the 1999 Scheme, taken cognizance of their presence and made appropriate provision for their absorption. Its failure to do so has certainly resulted in unintended discrimination qua one section of the company paid staff. It is, therefore, appropriate to direct that the Government of India should frame a scheme for absorption of eligible and suitable employees against Group D posts. The scheme should be modeled on the 1999 Scheme. The needful be done within

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six moths. Thereafter, eligible and suitable members of the company paid staff should be absorbed against Group D posts.

94. We also feel that the salaries and allowances payable to the company paid staff should be suitably increased in the wake of huge escalation of living cost. In Jawaharlal Nehru Technological University vs. T. Sumalatha (Smt.) and others (supra), a two-Judges Bench, after taking note of the fact that emoluments payable to the Investigators appointed in the Nodal Centre at Hyderabad had not been revised for six years directed the Union of India to take expeditious steps in that direction. Keeping that judgment in mind, we direct the Official Liquidators attached to various High Courts to move the concerned Court for increasing the emoluments of the company paid staff. Such a request should be sympathetically considered by the concerned Courts and the emoluments of the company paid staff be suitably enhanced and paid subject to availability of funds.

95. In the result, the appeals are allowed. The impugned judgments and orders are set aside subject to the direction for framing of scheme for absorption of eligible and suitable employees against Group D posts and implementation thereof and increase in the salaries and emoluments payable to the company paid staff.

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Administrative Law and Judicial Review of Administrative Action

By Justice Markandey Katju11

The topic of "Administrative law and judicial review of administrative action" is a very important subject in modern times. I intend to dwell on the aspects of how administrative law came into existence, its objects and its broad principles.

According to Wade, administrative law is the law relating to the control of powers of the executive authorities1 To consider why such a law became necessary, we have to consider its historical background.

Up to the 19th century the functions of the State in England were confined to (i) defence of the country from foreign invasion, and (ii) maintenance of law and order within the country.

Feudal, agricultural society, was relatively simple and social relations were uncomplicated. There were few laws, mainly customary (not statutory). But with the advent of industrial revolution in the 18th and 19th centuries, society became complex. Concentration of people in urban areas called for new regulatory State authorities for town planning, housing improvement, public health, education, factory management, street lighting, sewerage, drainage, sanitation, schemes for providing water, electricity, etc. Also the early 20th century laid the foundation for a Welfare State dealing with health insurance, unemployment allowance, sickness and old age benefits, free and compulsory education, etc.

This vast expansion in the State functions called for a huge amount of legislation and also for wide delegation of State functions by Parliament to executive authorities, so also was there a need to create a body of legal principles to control and to check misuse of these new powers conferred on the State authorities in this new situation in the public interest. Thus, emerged administrative law. Maitland pointed out in his Constitutional History:

"Year by year the subordinate Government of England is becoming more and more important. We are becoming a much governed nation, governed by all manner of councils and boards and officers, central and local, high and low, exercising the powers which have been committed to them by modern statutes."

11 Cite as : (2005) 8 SCC (J) 25; Lecture delivered in the "Nain Singh Memorial Lecture" held on 26-9-2005 at the Uttaranchal Academy of Administration, Nainital, Uttaranchal

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But in the early 20th century following the tradition of Dicey's classic exposition in his The Law of the Constitution, there was a spate of attacks on parliamentary delegation culminating in the book New Despotism by the then Chief Justice of England, Lord Hewart published in 1929. In response, the British Government in 1932 set up a committee called the Committee on Ministerial Powers headed by Lord Donoughmore, to examine these complaints and criticisms. However, the Donoughmore Committee rejected the argument of Lord Hewart and accepted the reality that a modern State cannot function without delegation of vast powers to the executive authorities, though there must be some control on them.

Parliament could theoretically exercise this control, but in practice it could not, since it did not have the time. Hence it became the duty of the Judges, though unelected, to become representatives of the people and ensure that executive authorities do not abuse their powers, but instead use it in the public interest.

But Judges too are not supposed to act arbitrarily. Hence a body of legal principles was created (largely by Judges themselves in their judgments and not by Parliament) on the basis of which Judges had to exercise their powers of judicial review of administrative action on settled principles but not arbitrarily. It is this body of rules which is known as administrative law.

Being largely Judge-made, administrative law is not contained in any Administrative Law Act, just as the income tax law is contained in the Income Tax Act or the sales tax law in the Sales Tax Act. Hence some writers have criticised administrative law as a "wilderness of single instances, and not a separate, coherent branch of law". However, the fundamental principle behind administrative law has always remained the same, namely, that in a democracy the people are supreme, and hence all State authority must be exercised in the public interest.

It is a mistake to think that administrative law is necessarily antagonistic to efficient government. As Wade points out "intensive administration will be more tolerable to the citizen, and the Government's path will be smoother, where the law can enforce high standards of legality, reasonableness and fairness".

As pointed out by Sir John Donaldson, M.R., in R. v. Lancashire CC, ex p Huddleston2

All ER p. 945c the development of administrative law

"has created a new relationship between the courts and those who derive their authority from the public law, one of partnership based on a common aim, namely, the maintenance of the highest standards of public administration".

In Tata Cellular v. Union of India3 (para 113) the Supreme Court laid down the following basic principles relating to administrative law: (SCC pp. 687-88, para 94)

(1) The modern trend points to judicial restraint in administrative action;

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(2) the Court does not sit as a court of appeal over administrative decisions, but merely reviews the manner in which the decisions were made;

(3) the Court does not have the expertise to correct administrative decisions. If a review of the administrative decisions is permitted it will be substituting its own decision without the necessary expertise, which itself may be fallible;

(4) a fairplay in the joints is a necessary concomitant for the administrative functioning.

(5) however, the administrative decision can be tested by application of the Wednesbury principle of reasonableness, and must be free from arbitrariness, bias or mala fides.

There are two kinds of controls on executive powers viz.:

(1) statutory, and

(2) non-statutory.

Statutory controls

Statutory controls are given in the statute (or rules or regulations made under the statute). Any executive action in violation of the same will be declared illegal by the courts, by applying the ultra vires doctrine.

Thus, where the London County Council had statutory powers to purchase and operate tramways, it was held by the House of Lords that it had no power to run omnibuses, which was not incidental to the running of tramways4 Similarly a local authority with the power to acquire land other than "park, garden or pleasure house" acts in excess of jurisdiction in acquiring land which is part of a park5

An executive authority may also act unlawfully if it fails to perform a duty imposed upon it by statute such as maintenance of civic services (e.g. sewerage, drainage, water supply, etc.) by the Municipalities or other local bodies whose duty under the statute is to maintain such services. Here also a mandamus will issue from the courts to compel such authority to perform its statutory duty.

Where the statute delegates a power to a particular authority, that authority cannot sub-delegate that power to another authority or person unless the statute permits such sub-delegation.

Similarly, discretion exercised by the prescribed authority on the direction of a higher authority would be illegal6

When the statute prescribes the manner of doing an act, the authority must do it in that manner alone7

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Difficulty, however, arises in the matter of what is called "subjective discretion" conferred by the statute. An instance of such subjective discretion is where the statute says that an executive authority can take such decision "as it deems fit". Another example is where the statute says that action can be taken or order passed where the authority has "reasonable grounds to believe" to take that action or pass such order e.g. Section 132 of the Income Tax Act which confers power on the Commissioner of Income Tax to order search and seizure where he has "reason to believe" that some person is concealing his income.

In Liversidge v. Anderson8 the Defence (General) Regulations, 1939 provided:

"If the Secretary of State has reasonable cause to believe any person to be of hostile origin or association he may make an order against that person directing that he be detained."

The detenu Liversidge challenged the detention order passed against him by the Secretary of State. The majority of the House of Lords, except Lord Atkin, held that the Court could not interfere because the Secretary of State had mentioned in his order that he had reasonable cause to believe that Liversidge was a person of hostile origin or association. Liversidge8 was delivered during the Second World War when the executive authority had unbridled powers to detain a person without even disclosing to the Court on what basis the Secretary had reached to his belief. However, subsequently, the British courts accepted Lord Atkin's dissenting view that there must be some relevant material on the basis of which the satisfaction of the Secretary of State could be formed. Also, the discretion must be exercised keeping in view the purpose for which it was conferred and the object sought to be achieved, and must be exercised within the four corners of the statute9

Sometimes a power is coupled with a duty10 Thus, a limited judicial review against administrative action is always available to the courts.

Non-statutory controls

Some of the non-statutory controls are:

(a) The Wednesbury principle

(b) Rules of natural justice

(c) Proportionality (See Teri Oat Estates (P) Ltd. v. Union Territory, Chandigarh11, Union of India v. Rajesh P.U.12, etc.)

(d) Promissory estoppel13

(e) Legitimate expectation14

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We may only consider some of these in detail.

Wednesbury Principle

Up to 1947 the law in England was that the courts could interfere only with judicial or quasi-judicial decisions and not with administrative decisions. This legal position changed after the famous decision of Lord Greene in Associated Provincial Picture Houses Ltd. v. Wednesbury Corpn.15 in which it was said: (All ER pp. 682 H-683 A)

A person entrusted with discretion must, so to speak, direct himself properly in law. He must call his attention to matters which he is bound to consider. He must exclude from his consideration matters which are irrelevant to what he has to consider. If he does not obey those rules he may truly be said to be acting unreasonably. Similarly, there may be something so absurd that no sensible person could ever dream that it lay within the powers of the authority.

The above observation incorporates what is frequently called as the Wednesbury principle.

The courts often intervene to quash as illegal the exercise of administrative discretion on the ground that it suffers from "Wednesbury unreasonableness".

Thus, in Dy. Director of Consolidation v. Deen Bandhu Rai16, the settlement officer rejected an application for permission to effect an exchange of holdings on the grounds (i) that the granting of the permission would entail considerable work on the part of officers of the department, and (ii) that the applicants were big landholders. The Supreme Court held that these reasons were not germane and pertinent for the rejection of the petitions.

In Barium Chemicals Ltd. v. Company Law Board17 the Secretary of the Company Law Board issued an order under Section 237(b) of the Companies Act, 1956 appointing inspectors to investigate the affairs of a company. Section 237(b) of the Act authorised such an appointment to investigate the affairs of a company "if, in the opinion of the Central Government" there were circumstances suggesting (a) that the business of the company was being conducted with the intent to defraud its creditors, members, or any other person; (b) that the persons concerned in the formation of the company or the management of its affairs had been guilty of fraud or misconduct towards the company or towards any of its members; (c) that the members of the company had not given out all the information with respect to its affairs. The Supreme Court held that before the discretion conferred by Section 237(b) of the Companies Act can be exercised, there must exist circumstances which in the opinion of the authority suggest the grounds set out in the statute.

Unfettered discretion would also be inconsistent with Article 19 of the Constitution which permits only reasonable restrictions on the rights conferred by that Article.

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Similarly, it would also be violative of Article 14 which prohibits arbitrariness18 In Shalini Soni v. Union of India19 the Supreme Court observed: (SCC p. 549, para 7)

"It is an unwritten rule of the law, constitutional and administrative, that whenever a decision-making function is entrusted to the subjective satisfaction of a statutory functionary, there is an implicit obligation to apply his mind to pertinent and proximate matters only, eschewing the irrelevant and the remote."

In Rohtas Industries v. S.D. Agarwal20, an investigation into the affairs of a company was ordered under Section 237 of the Companies Act, 1956. The Company Law Board took into account the fact that there were complaints of misconduct against one of the leading directors of the company in relation to other companies subject to his control for which he was being prosecuted. The Court held that this factor was irrelevant in establishing fraud.

The Wednesbury principle is often misunderstood to mean that any administrative decision which is regarded by the Court to be unreasonable must be struck down. The correct understanding of the Wednesbury principle is that a decision will be said to be unreasonable in the Wednesbury sense if (i) it is based on wholly irrelevant material or wholly irrelevant consideration, (ii) it has ignored a very relevant material which it should have taken into consideration, or (iii) it is so absurd that no sensible person could ever have reached to it.

As observed by Lord Diplock in Council of Civil Service Unions v. Minister for the Civil Service21, a decision will be said to suffer from Wednesbury unreasonableness if it is "so outrageous in its defiance of logic or of accepted moral standards that no sensible person who had applied his mind to the question to be decided could have arrived at it" (All ER p. 951a-b).

An administrative decision cannot be struck down by the Judge merely because he disagrees with the administrator22 There may be degrees of unreasonableness, and the Wednesbury unreasonableness refers only to the extreme degree of unreasonableness which no sensible person could reach after taking into account the relevant materials or relevant considerations. Thus, in W., Re,23 Lord Hailsham observed: (All ER p. 56g-h)

"Two reasonable parents can perfectly reasonably come to opposite conclusions on the same set of facts without forfeiting their title to be regarded as reasonable. ... Not every reasonable exercise of judgment is right, and not every mistaken exercise of judgment is unreasonable."

Hence, the Wednesbury unreasonableness means "unreasonableness verging on absurdity" as observed by the House of Lords in Puhlhofer v. Hillingdon L.B.C.24

Rules of Natural Justice

The rules of natural justice were originally only two viz.:

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1. Audi alteram partem i.e. the person(s) to be affected by an order of the authority should be heard before the order is passed, and

2. The rule against bias.

Subsequently, some more rules of natural justice are in the process of development e.g. that the administrative authority should give reasons for its decisions, particularly when the decisions affect the rights and liabilities of the citizens.

It must, however, be made clear that the rules of natural justice are flexible, and are not a straitjacket formula25 In exceptional cases not only can they be modified but even excluded altogether26 Natural justice is not an unruly horse. If fairness is shown, there can be no complaint of breach of natural justice27

As regards the rule audi alteram partem, up to 1964 the legal position in England was that in judicial and quasi-judicial proceedings opportunity of hearing had to be given, but it was not necessary to do so in administrative proceedings. This legal position changed in Ridge v. Baldwin28 in which the House of Lords held that opportunity of hearing had to be given even in administrative proceedings if the administrative order would affect the rights and liabilities of the citizens. This view of the House of Lords was followed by the Supreme Court in State of Orissa v. Dr. Binapani Dei29 and State of Maharashtra v. Jalgaon Municipal Council30 wherein it was held that administrative orders which involve civil consequences have to be passed consistently with the rules of natural justice. The expression "civil consequences" means where rights and liabilities are affected. Thus, before blacklisting a person he must be given a hearing31

It may be noted that even if the statute does not expressly require that opportunity of hearing must be given before passing an order which affects rights and liabilities, the courts have held that such opportunity of hearing must be given unless expressly excluded by the statute32 Thus, natural justice is an implied requirement of administrative decisions which affects rights and liabilities.

It may be mentioned that a hearing need not always be an oral hearing. In certain circumstances, the Administrator can only issue a show-cause notice to the party likely to be affected and on his/her reply can pass the decision without giving a personal hearing to the parties. However, in certain circumstances where the party may be very seriously affected the courts have insisted that an oral hearing with opportunity of presenting witnesses and cross-examining the witnesses on the other side must be given.

Similarly, the principle that "no man should be a judge in his own cause" disqualifies an Administrator from giving a decision which affects the rights and liabilities, if he is biased.

It may, however, be pointed out that in H.C. Narayanappa v. State of Mysore33 the Supreme Court observed that the Minister or officer invested with the power to hear objections to a scheme is acting in his official capacity and unless there is reliable

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evidence to show that he is actually biased, his decision will not be liable to be called in question merely because the objections to the government scheme are heard by the government itself or by its officers.

The requirement to give reasons in administrative decisions which affect rights and liabilities has been held to be mandatory by the Supreme Court in S.N. Mukherjee v. Union of India34 This reduces the chances of arbitrariness on the part of the authority, as the reasons recorded by him are subject to judicial scrutiny by the higher courts or authorities.

Before concluding, it must also be mentioned that there are certain administrative matters which are inappropriate for judicial review. One of these is policy decisions of the government or of the executive authority which ordinarily should not be interfered with by the courts unless they are clearly violative of the statute or shockingly arbitrary 35, Union of India v. International Trading Co.14, etc. In the instant case the facts were that the Central Government had initially decided to locate the headquarters of South Western Railways at Bangalore. Later it was decided to locate it at Hubli, and this decision was challenged. The Supreme Court held that it was a policy decision and hence the Court cannot interfere, even if the decision was political36

Similarly, maintenance of law and order is an executive function, and the courts should not ordinarily interfere with the same37

Apart from that, practically every legal system recognises certain subjects as inappropriate for judicial review e.g. foreign affairs, declaration of wars, etc.

Remedies

Remedies for enforcing administrative law are available before the higher judiciary e.g. the Supreme Court under Article 32 of the Constitution and the High Courts under Article 226 of the Constitution. The higher judiciary can issue writs of certiorari, mandamus, habeas corpus, prohibition and quo warranto and also issue orders or directions "in the nature of writs".

The language used in Articles 32 and 226 is thus wide, and it has been held that the Indian courts have wider powers than the British courts in issuing writs38 Article 226 confers powers on the High Court not only to issue prerogative writs, but also issue order or direction to enforce fundamental and other legal rights39 Hence the High Courts in India are not confined to the procedural technicalities of the English rules40 The Court can also mould the relief to meet the peculiar and complicated requirements of this country, provided the High Court does not contravene any provisions of the Constitution or the law.

A writ can be issued by the High Courts and the Supreme Court not only to the Government, but also to what are called instrumentalities of the State. A writ of certiorari

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will be issued when the court finds that there is an error of law apparent on the face of record. A mandamus will be issued to a public authority to compel it to do its public duty.

In the grants of public contracts the courts usually (though not invariably) insist that such grants be made by public auction/public tender after advertising the same in well-known newspapers having wide circulation so that there is transparency and compliance with Article 14 of the Constitution. Such grants by private negotiation are ordinarily disapproved41

A writ can be issued to enforce the statute or statutory rule or order. However, a question may arise whether it can be issued to enforce non-statutory government orders or executive instructions.

The earlier decisions of the Supreme Court were of the view that no mandamus will issue to enforce mere administrative instructions which have no statutory force42 However, subsequently, certain exceptions have been carved out to the above principle. In certain exceptional circumstances, mandamus can be issued to enforce a non-statutory administrative order. Some of such exceptions are:

(i) Where the principle of promissory estoppel applies e.g. in Union of India v. Indo Afghan Agencies Ltd.43, Motilal Padampat Sugar Mills Co. Ltd. v. State of U.P.44, etc.

(ii) Where the principle of legitimate expectation applies45

(iii) In service matters, where there are no statutory rules, administrative instructions can fill in the gap, and are enforceable46

(iv) In many matters e.g. awards of public contracts, an executive authority must be rigorously held to the standards by which it professes its actions to be judged, even if such actions are non-statutory47

I am not going into further details of administrative law or judicial review of administrative action as I only intended to set out the broad outlines.

 

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1. Administrative Law (9th Edn.) 2. (1986) 2 All ER 941 (CA) 3. (1994) 6 SCC 651 4. London County Council v. Attorney General, 1902 AC 165 (HL) 5. White and Collins v. Minister of Health, (1939) 2 KB 838 : (1939) 3 All ER 548

(CA) 6. Anirudhsinhji Karansinhji Jadeja v. State of Gujarat, (1995) 5 SCC 302 : 1995

SCC (Cri) 902 7. Bhavnagar University v. Palitana Sugar Mill (P) Ltd., (2003) 2 SCC 111; Capt.

Sube Singh v. Lt. Governor of Delhi, (2004) 6 SCC 440 8. 1942 AC 206 : (1941) 3 All ER 338 (HL) 9. Clariant International Ltd. v. SEBI, (2004) 8 SCC 524 10. G.P. Singh: Principles of Statutory Interpretation (9th Edn.) p. 395. 11. (2004) 2 SCC 130 12. (2003) 7 SCC 285 : 2003 SCC (L&S) 1048 13. State of Punjab v. Nestle India Ltd., (2004) 6 SCC 465 14. Union of India v. International Trading Co., (2003) 5 SCC 437 15. (1947) 2 All ER 680 : (1948) 1 KB 223 (CA) 16. (1964) 4 SCR 560 : AIR 1965 SC 484 17. 1966 Supp SCR 311 : AIR 1967 SC 295 18. Maneka Gandhi v. Union of India, (1978) 1 SCC 248 19. (1980) 4 SCC 544 : 1981 SCC (Cri) 38 20. (1969) 1 SCC 325 21. 1985 AC 374 : (1984) 3 All ER 935 (HL) 22. Gazi Saduddin v. State of Maharashtra, (2003) 7 SCC 330 : 2003 SCC (Cri) 1637 23. 1971 AC 682 : (1971) 2 All ER 49 (HL) 24. (1986) 1 All ER 467 (HL) 25. Bar Council of India v. High Court of Kerala, (2004) 6 SCC 311 (paras 49 and

50). 26. Union of India v. Tulsiram Patel, (1985) 3 SCC 398 : 1985 SCC (L&S) 672 (para

101). 27. Chairman, Board of Mining Examination v. Ramjee, (1977) 2 SCC 256 : 1977

SCC (L&S) 226 28. 1964 AC 40 : (1963) 2 All ER 66 (HL) 29. (1967) 2 SCR 625 : AIR 1967 SC 1269 30. (2003) 9 SCC 731 31. Raghunath Thakur v. State of Bihar, (1989) 1 SCC 229 32. State Govt. Houseless Harijan Employees' Assn. v. State of Karnataka, (2001) 1

SCC 610 (paras 27 to 30). 33. (1960) 3 SCR 742 : AIR 1960 SC 1073 34. (1990) 4 SCC 594 : 1990 SCC (Cri) 669 35. Union of India v. Manu Dev Arya, (2004) 5 SCC 232 : 2004 SCC (L&S) 769 36. Union of India v. Kannadapara Sanghatanegala Okkuta, (2002) 10 SCC 226 37. State of Karnataka v. Dr. Pravin Bhai Thogadia, (2004) 4 SCC 684 : 2004 SCC

(Cri) 1387; Rama Muthuramalingam v. Dy. Supdt. of Police, AIR 2005 Mad 1

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38. Dwarkanath v. ITO, (1965) 3 SCR 536 : AIR 1966 SC 81 39. Air India Statutory Corpn. v. United Labour Union, (1997) 9 SCC 377 : 1997

SCC (L&S) 1344; P.J. Irani v. State of Madras, (1962) 2 SCR 169 : AIR 1961 SC 1731

40. T.C. Basappa v. T. Nagappa, (1955) 1 SCR 250 : AIR 1954 SC 440 41. S. Selvarani v. Commr., Karaikudi Municipality, (2005) 1 CTC 81 42. G.J. Fernandez v. State of Mysore, (1967) 3 SCR 636 : AIR 1967 SC 1753; J.R.

Raghupathy v. State of A.P., (1988) 4 SCC 364 43. (1968) 2 SCR 366 : AIR 1968 SC 718 44. (1979) 2 SCC 409 45. J.P. Bansal v. State of Rajasthan, (2003) 5 SCC 134 : 2003 SCC (L&S) 605,

paras 25 to 30. 46. Amarjit Singh Ahluwalia (Dr.) v. State of Punjab, (1975) 3 SCC 503 : 1975 SCC

(L&S) 27, para 8; B.N. Nagarajan v. State of Mysore, (1966) 3 SCR 682 : AIR 1966 SC 1942; Sant Ram Sharma v. State of Rajasthan, (1968) 1 SCR 111 : AIR 1967 SC 1910

47. Ramana Dayaram Shetty v. International Airport Authority of India, (1979) 3 SCC 489, para 10.

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THE RIGHT TO INFORMATION ENDEAVOUR FROM SECRECY TO TRANSPARENCY AND ACCOUNTABILITY:

STRNGTHENING THE MISSION OF RIGHT TO INFORMATION IN INDIA

Dr. Jeet Singh Mann, Asstt. Professor of Law, National Law University, Delhi

1. Introduction

In a case12 before the Chief Information Commissioner, New Delhi, where, Shri D S Negi of Dwarka, New Delhi, went to the office of the Chief Engineer (Dwarka Project, New Delhi) to file an RTI application in connection with a water crisis. The applicant was directed to meet the Assistant to Chief Engineer. The Assistant signed the application and marked it to the PIO, SE (HQ) of the Organization. The PIO asked the applicant to submit an amount of Rs. 10/- in cash, as the IPO will not be acceptable because of an accounting problem. The application was then marked to Sr. AO. He in turn marked it to the Accountant and then to the Receipt Clerk. The receipt Clerk simply refused to accept the application and asked applicant to bring a photocopy of the receipt for Rs. 10/- to be attached with the application as proof of payment of the requisite fee. The process therefore took nearly 3 ½ hrs to simply file an RTI application. This is one of the instances which has been reported and adjudicated by the Central Information Commissioner New Delhi. This case depicts high handedness on the part of public authorities to harass applicants who seek information from them. It has been noticed that the PIO or the public authority always tries to manipulate the situation in their favor, because the legal position on the issue of payment of fee under the section 6 of the RTI Act, 2005, is not uniform, but also provides opportunity to the PIO/public authority to victimize applicants. In case cash is deposited with the application then they would ask for the other modes of payment and vice versa.

Moreover different prescribed fees are being charged by various States, high courts and other agencies. There is no uniformity in the payment of application fee and other charges, payable under the RTI Rules framed by various authorities. The Right to Information (Regulation of Fee and Cost) Rules 2005 provides that a fee of Rs. 10 for filing the request. If the applicant is a Below Poverty Card holder, then no fee shall apply.

12 Complaint No CIC/WB/C/2006/00178 -14.11.2006; CIC expressed deep concern over the careless attitude in receiving an application under RTI and directed to make easily accessible arrangements for receiving RTI applications over one window or centralized counter

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Such BPL Card holders have to provide a copy of their BPL card along with their application to the Public Authority’. State Governments and High Courts fix their own fee rules The Rajasthan Right To Information (High Court & Subordinate Courts) Rules, 200613 states that Any person seeking information under the RTI Act, shall make an application in Form ‘A’ to the Authorized Person along with non-judicial stamp, of Rs. 100 duly affixed on/attached to it, which shall be nonrefundable: Provided that where the information relates to tender documents/bids/quotation/business contract, the application fee shall be Rs. 500 per application.

The Right to Information (Regulation of Fee and Cost) Central Rules 200514 stipulates the payment of prescribed fee along with application under Section 6 of the RTI Act, 2005, by Indian Postal Orders/ Cash/ Bank Cheque/ Bank Drafts/ Money Orders. It has been observed that the majority of the Public Information Officer/APIO does not accept cash, which is the most convenient mode of payment of fee. But the PIO/APIO always insist applicant either to deposit IPO or Bank Draft or Money Order or chalan. The process of procuring IPO, Bank Draft, or Money order, is time consuming and the applicant is required to undergo addition financial burden by paying charges for IPO, MO or Bank Draft.

The research paper aims at in highlighting the pitfalls in the RTI Scheme in India and remedial measures to eliminate these drawbacks. This article would focus on the measures (appointment of PIO, penal provision for violation of Section 4 of the Act, empowering the Consumer Forum, constituted under the Consumer Protection Act 1986, to deal with the RTI Matters in case of losses due to non display of information under section 4 of the RTI Act, inspection etc) for strengthening the RTI Act, which would ensure people friendly approach and transparency in administration and governance of the country

2. The Right to Information: Its importance and development in India

The Right to information laws has been in existence since 1776, when Sweden passed its Freedom of Press Act, which requires disclosure of official documents upon request. The right to information and freedom also has been recognized fundamental human rights, under Article 19 of the Universal Declaration of Human rights, 1948.The movement of right to information can be traced back to the grassroots struggle of the rural to fight against corruption in their areas affecting their livelihood and justice.

13 Rule 4 Application for seeking information14

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The Parliament passed the Freedom of Information Act in 2002. However, apart from the fact that this Act was also a weak Act, it was never notified and lay dormant from 2002 till it was repealed in 2005 by the new right to Information Act, 2005. The RTI Laws were first successfully enacted by the state governments of — Tamil Nadu (1997)Goa (1997), Rajasthan (2000), Karnataka (2000), Delhi (2001), Maharashtra (2002), Madhya Pradesh (2003), Assam (2002) and Jammu and Kashmir (2004). The Maharashtra and Delhi State level enactments are considered to have been the most widely used. The Delhi RTI Act is still in force. Jammu & Kashmir, has its own Right to Information Act of 2009, the successor to the repealed J&K Right to Information Act, 2004 and its 2008 amendmentThe Supreme Court of India in State of Uttar Pradesh Vs Raj Narain15 has recognized the right to information is an important right in a democratic state. The court opined that:

“In a government of responsibility like ours, where all the agents of public must be responsible for their conduct, there can be few secrets, everything that is done in a public way by the public functionaries. They are entitled to know, the particulars of every public transaction in all its bearing. Their right to know, which is derived from the concept of freedom of speech, through not absolute, is a factor, which should make one wary when secrecy is claimed for transactions which can at any rate have no repercussion on public security. To cover with veil secrecy, the common routine business is not in the interest of the public. Such secrecy can seldom be legitimately desired. It is generally desired for purpose of parties and politics or personal self-interest or bureaucratic routine. The reasonability of officials to explain and to justify their acts is the chief safeguard against oppression and corruption.”

Further a Seven Bench of the Supreme Court in SP Gupta Vs Union of India16 recognized the right to information as a Fundamental Right under Article 19 1(a) of the Constitution. The Court declared that

“There is also in every democracy a certain amount of public suspicion and distrust of government, varying of course from time to time according to its performance, which prompts people to insist upon maximum exposure of its functioning. It is axiomatic that every action of the government must be actuated by public interest but even so we find cases, though not many where government action is taken not for public good but for personal gain or other extraneous considerations. Political and other motivations and pressures influence sometimes-governmental action and at times, there are also instances of misuse or abuse of authority on the part of the executive. Now, if secrecy were to be

15 AIR 1975 SC 865 16 AIR 1982 SC 149 see also Union of India v. Assn. for Democratic Rights ((2002) 5 SCC 294); Secy., Ministry of Information & Broadcasting, Govt. of India v. Cricket Assn.of Bengal ((1995) 2 SCC 161); and People’s Union for Civil Liberties (PUCL) v. Union of India ((2003) 4 SCC 399

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observed in the functioning of government and the process of government were to be kept hidden from public scrutiny, it would tend to promote and encourage oppression, corruption and misuse or abuse of authority, for it would be all shrouded in the veil of secrecy without any public accountability. But if there is an open government with means of information available to the public, there would be greater exposure of the functioning of government and it would help to assure the people a better and more efficient administration”.

Mathew Commission Report (1982) recommended for amendment of the Indian Official Secrets Act, 1923, which was considered as grate impediment in the way of peoples’ right to know and Section 5 of this Act (IOS) was sought to be suitable amended. Former Prime Minister Mr. V P Singh declared its decision to make right to information as a fundamental right. While speaking at 20 th Conference of Ministers of Information and Cinematography in April 1990 he expressed

“An open system of governance is an essential prerequisite for the fullest flowering of democracy. Free flow of information from the government to the people will not only create an enlightened and informed public opinion but also render those in authority accountable”.

Right to information or right to know is an integral part and basic tenet of the freedom of speech and expression, a fundamental right guaranteed under Article 19(1) (a) of the Constitution. It also flows from Article 21 as enunciated by the apex court in the case of *Reliance Petrochemicals Ltd. vs. Proprietors of Indian Express Newspapers Bombay Pvt. Ltd. And others17, the apex court in this case while dealing with the issue of freedom of press and administration of justice, held that “we must remember that the people at large have a right to know in order to be able to take part in a participatory development in the industrial life and democracy. Right to know is a basic right which citizens of a free country aspire in the broader horizon of the right to live in this age in our land under Article 21 of our Constitution. That right has reached new dimensions and urgency. That right puts greater responsibility upon those who take upon themselves the responsibility to inform”.

Chairman of National Commission to Review the Working of the Constitution, Justice M N Venketchaliah18 expressed that

“Major assumption behind a new style of governance is the citizen’s access to information. Much of the common man’s distress and helplessness could be traced to his lack of access to information and lack of knowledge of decision-making processes. He

17 (1988) 4 SCC 59218 Para 6.10 of the Report 2002, dated 31 March 2002

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remains ignorant and unaware of the processes, which vitally affect his interest. Government procedures and regulations shrouded in a veil of secrecy do not allow the clients to know how their cases are being handled. They shy away from questioning officers handling their cases because of later’s snobbish attitude and bow-wow style. Right to information should be guaranteed and needs to be given real substance. In this regard, government must assume a major responsibility and mobilize skills to ensure flow of information to citizens. The tradition insistence on secrecy should be discarded. In fact we should have an “Oath of Transparency” in place of an oath of secrecy. Administration should become transparent and participatory. Right to information can usher in many benefits, such as speedy disposal of cases, minimizing manipulative and dilatory tactics of the babudom, and last but most importantly, putting considerable checks on graft and corruption.”

The Supreme Court in another case19observed that:

“True democracy cannot exist unless all citizens have a right to participate in the affairs of the politic of the country. The right to participate in the affairs of the country is meaningless unless the citizens are not well informed on all issues of the issues, in respect of which they are called upon to express their views. One side information, disinformation, misinformation and non information all equally create an uninformed citizenry, which makes either by a partisan central authority, or by private individuals or oligraphic organizations. This is particularly so in country like ours where about 65 percent of the population is illiterate and hardly 1 ½ percent of the population has an access to the print media which is no subject to pre-censorship.” Further the also declared that “A successful democracy posits an aware citizenry”.

3. Basic features of the Right to Information Act 2005

The Right to Information Act (RTI) 2005 was passed by the Parliament in May 2005, which received Presidential assent in Jun 2005, and came in force from 13 October 2005.The RTI Act 2005 covers all central, state and local government bodies and, in addition to the executives, it also applies to the judiciary and the legislature. It covers all bodies owned, controlled or substantially financed, either directly or indirectly by the government, and non-governmental organizations and other private bodies substantially funded, directly or indirectly, by the government. It would seem to include private schools, hospitals and other commercial institutions that have got subsidies in the form of land at confessional rates or tax concessions, among others. The Act also applies to private sector as it provides the citizens access to all information that the government can itself access through any other law. The Act defines information under Section 2(f)20 which “means any material in any form, including records, documents, memos, e-mails, 19 Union of India Vs Association For Democratic Reforms, AIR 2002 SC 2112

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opinions, advices, press releases, circulars, orders, logbooks, contracts, reports, papers, samples, models, data material held in any electronic form and information relating to any private body which can be accessed by a public authority under any other law for the time being in force.” Right to information under Section 2(j)21 is defined as means the right to information accessible under the Act, which is held by or under the control of any public authority and includes the right to- inspection of work, documents, records; taking certified notes, extracts or certified copies of documents or records; taking certified samples of material; obtaining information in the form of diskettes, floppies, tapes, video cassettes or in any other electronic mode or through print outs where such information is stored in a computer or in other device. This clearly means that file notings are also to be disclosed, subject to the exemption specified under the provisions of the RTI Act.

The Act, under Section 8 and 24, contains certain exemptions from disclosure of information. The matters which are beyond the scope of the Act includes the disclosure of information which would prejudicially affect the sovereignty and integrity of India, the security, strategic, scientific or economic interests of the State, relation with the foreign State or lead to incitement of an offence; or information which has been expressly forbidden to be published by any court of law or tribunal or the disclosure of which may constitute contempt of court. It also excludes the disclosure of information, which would cause a breach of privileges of Parliament or State Legislature. The provisions of the Indian Official Secret Acts, 1923 are also exempted from the scope of the Act. The Act provides for the setting up of independent Information Commissions, one at the Center and one at each state, comprising of one Chief Information Commissioner and up to ten Information Commissioners. Complaints against violations of provisions can be made to the Information Commissioner. Public Information Officers (PIOs) are also appointed to accept requisitions and provides information within 30 days after receiving such complaint. Extensions are also allowed in some cases such as when third party is

20 Section 2(i) "record" includes—

(a) any document, manuscript and file; (b) any microfilm, microfiche and facsimile copy of a document; (c) any reproduction of image or images embodied in such microfilm (whether enlarged or not); and (d) any other material produced by a computer or any other device;

21 Section 2 (j) "right to information" means the right to information accessible under this Act which is held by or under the control of any public authority and includes the right to—

(i) inspection of work, documents, records; (ii) taking notes, extracts or certified copies of documents or records; (iii) taking certified samples of material; (iv) obtaining information in the form of diskettes, floppies, tapes, video cassettes or in any other electronic mode or through printouts where such information is stored in a computer or in any other device;

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involved. Information pertaining to the life and liberty of a person must, nevertheless, be provided in 48 hours. The Act stipulates penalties for PIOs found to be in violation of the provisions. The information Commission can impose penalties at the rate of Rs. 250 per day, and also penalize for refusals to accept requests, for mala fide destruction of information, knowingly giving false information etc., with and maximum limit of Rs. 25,000. Immunity to PIOs for actions done in good faith is also applicable under the provisions of the Act.

4. Defects and improvement needed:

4.1. Protect applicant under the RTI from victimization The RTI does not provide any protection to the applicants for use of the RTI. The CIC may award compensation for any harassment, threat or intimidation caused to the applicants for seeking information. It is evident from the incidents that has been occurred in past that the public authority has been trying to suppress the information and coerce the applicant in case the applicant is employed in that organization.

The view of the Author has been vindicated by a reported case before the Chief

Information Commission(CIC), Which depicts the ground realities about the conduct of the public authority for suppressing the facts and harassing the applicants under the RTI Act. I am giving anecdote of the instance where In November 2005 under the RTI Act the applicant requested for access to Prof. Harikesh Singh Inquiry Report, which enquired into the incident relating to various aspects of incidents on 11-12 January 2005 when Shri Yogesh Roy, a student of the Banaras Hindu University, died at Sir Sunder Lal Hospital attached to the University. Registrar, BHU, both In-charge of administration and Appellate Authority under the RTI Act, overruled the submissions of the PIO and thus became deemed PIO under Sub-Section 5 of Section 5 of the RTI Act 2005. Reply was sent to the Requester on 31.01.2006 under instruction from the Registrar denying him the information, thus, disposing of both, Appellant’s application dated 11.11.2005 and his first Appeal dated 26.12.2005. CIC in exercise of powers conferred by Section 20(1) of the RTI Act 2005 imposed a penalty of Rs.25, 000/- on Shri N. Sundaram, Registrar, Banaras Hindu University, Varanasi for denial of information

despite the Commission’s clear directions.22 CIC also raised with the Vice Chancellor [of BHU] the issue of alleged victimization of the RTI Appellant who had not been given admission to the post graduate course against seats reserved for students of the University. CIC directed that the Assistant Registrar, Shri Pankaj Shreyaskar, would visit the University to inspect the documents for satisfying the Commission that the non-admission of the Appellant was not in any way linked to the case before the

22 CIC/OK/A/ 2006/00163-19.10.2006

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Commission. the Commission directed the Vice Chancellor to release the compensation amount to the Appellant for three journeys to Delhi and back as

directed in its previous order dated 17.7.2006, as required under Section 19(8)(b)23.

In exercise of powers conferred by Section 19(8)(b) of RTI Act – 2005, CIC directed the BHU authorities to… admit Shri Dhananjay Tripathi in the M.P.E. course for the year 2006-07 with immediate effect and grant him a grace period up to the date of admission for the purpose of attendance and to ensure that an applicant seeking information from the University under the RTI Act 2005 is not victimized in future24.

The office of the CIC has issued numerous circulars to protect the interest of the applicants. One of such circulars reads as “some of the public authorities do not behave properly with the persons who seek information under the RTI Act. Responsibility of a public authority and its public information officers is not confined to furnish Information but also to provide necessary help to the information seeker, wherever necessary. While providing information or rendering help to a person, it is important to be courteous to the information seeker and to respect his dignity”25.

The objectives of the scheme cannot be achieved unless the applicant is protected from any harassment that might arise from the use of RTI Act. Firstly it is recommended that the Appellate Authority, the State Information commission and the Central Information commission should be empowered to award exemplary damages in such cases. Secondly the Act should also provide some protection to those employees who seek information from their organization. Some provisions on the matter, which restrict the organization from terminating services of , except on some serious misconduct after adhering to the doctrine of the audi alterm partem, such applicant during the period of pendency of proceedings under the Right to Inofrmation Scheme should be inserted in the Act. The Sate Information Commission and the Central Information Commission should be empowered to take cognizance of any such victimization and pass appropriate order on the matter.

4.2. Uniformity in the fee structure and simplification of the process of fee payment

23 CIC/OK/A/ 2006/00163-6.09.2006 24 CIC/OK/A/ 2006/00163-9.11.200625 Para 1 No.4/9/2008-IR Government of lndia Ministry of Personnel, Public Grievances and Pensions (Department of Personnel & Training) New Delhi Dated the 24th June, 2008. www.rti.gov.in

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At present, the application fee for obtaining information is not uniform all over the country. Application fee in Himachal Pradesh is Rs.10/-, whereas in Haryana it is Rs.50/- and in Arunachal Pradesh between Rs.500/- & Rs.50/-depending upon the type of information to be obtained.

The Central Government has prescribed Rs.10/- as application fee and Rs.2/- per page created or copied for obtaining information . However, the different State Governments have prescribed different fee. The application fee varies from Rs.500/- in Arunachal Pradesh to free of cost at village level in Andhra Pradesh. Similarly, some States levy fee for filing appeal, whereas it is free in most of the States. It is evident from the above analysis that that although some States have prescribed reasonable fees for obtaining information , whereas, in other States, heavy fee has been prescribed, which makes it difficult for the citizens to obtain the information . The heavy fee is not only against the spirit of the RTI Act, but also defeats the purpose of the Act.

The Himachal Pradesh Right to Information 2005 provides that “except in the case of persons who are below poverty line as determined by the State Government, the public information Officer/Assistant Public Information Officer shall charge the fee Rs. 10 along with application for supply of information. Where the information is available in the form of a on printed price a priced publication. For other than priced publication, fee rates are as Rs.10 per page of A-4 size of smaller and actual cost subject to minimum of Rs. 20 per page, in case of larger size. . Where information is available in electronic form Rupees 50 per floppy and Rs. 100 and is to be supplied in electronics form e.g. per CD Floppy, CD etc. Fee for inspection of record/document is Rs. 10 per 15 minutes or fraction thereof. Every page of information to be supplied shall be duly authenticated giving the name of the applicant ( including below poverty line status if that is the case), and shall bear the dated signatures and seal of the concerned Public Information Officer/ Assistant Public Information Officer supply the information. Fees/ Charges shall be deposited in a Government treasury under the head of account “0070-OAS, 60-OS, 800-OR, 11- Receipt head under Right to information Act, 2005”. Accruals in to this head of account may be separate fund by way of grant-in-aid for furthering the purposes of Act, including of equipment and consumable, providing training to staff etc26.

The Tamil Nadu Right to Information (Fees) Rules 200527 states that A request for obtaining information under sub-section (1) of section 6 of the RTI Act shall be made in writing or through electronic means either in person or by post to the Public Information and must be accompanied by an application fee of Rs.10/- by cash or by demand draft or banker's cheque. The Public Information Officer shall credit the amount to the head of account: "0075.00 Miscellaneous General Services – 800 and Other receipts –BK006. 26 Section 5 of the Himachal Pradesh RTI Act 200527 Rule 3 of the Tamil Nadu Right to Information (Fees) Rules 2005

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The applicant may also remit the fee under the above head of account through Treasury / Pay and Accounts Office / State Bank of India / Reserve Bank of India and produce the chalan to the Public Information Officer as an evidence for having remitted the fee. Persons below the poverty line are exempt from the payment of fee under the Right to Information Act, 2005. The list of persons below poverty line approved by the Gram Panchayat and local bodies will be the basis for claiming this concession. An extract of the list, duly certified, will be sufficient to avail this concession

Karnataka Right to Information Rules, 200528 provides that Any person desirous of obtaining information under sub-section (1) of section 6 of the Act shall make an application in Form-A or in any other format as far as possible containing the particulars specified under the format to the State Public Information Officer or State Assistant Public Information Officer as the case may be along with an initial fee of Rs. 10 with his application. Every officer receiving request under the Act shall give an acknowledgement. As regards inspection of records and documents, s no fee is charged for the first hour. For every subsequent half an hour or fraction thereof, Rs.20/- shall be charged from persons making application with initial payment as prescribed under rule 4(1) . For inspection of works a reasonable fee shall be fixed by the State Public Information Officer in each case depending upon the cost of labour and material required to be employed apart from initial fees as prescribed under rule 4(1). ) For providing information under sub-section (5) of section 7, the fees for supplying information in Diskette or Floppy or C.D. or in any other Electronic mode shall be Rs.50/- . The fee shall be collected in the form of Indian postal order or D.D. or Bankers Cheque or Pay order drawn in favour of the State Public Information Officer or in cash or by remitting it to the Treasury as per Karnataka Financial Code (KFC). A person claiming exemption under proviso to sub-section (5) of section 7 shall produce a valid certificate issued by the concerned authority that he/she belongs to the Below Poverty Line category

The application shall be accompanied by the prescribed fee of RS.10 which has been prescribed under the Kerala Right to Information (Regulation of Fee and cost) Rules, 2006. The application fee shall be paid in any of the manners, either by affixing court fee stamp; or by remitting the amount in the Government Treasury, under the head of account " 0070 other administrative services - 60 other services - 800 other receipts - 42 other items" ; or 36 - Receipts under RTI Act, 2005. by cash remittance against proper receipt in the office of the State Public Information Officer/ State Assistant Public Information Officer, as the case may be; or . by demand draft/bankers' cheque /pay order payable to the State Public Information Officer/State Assistant Public Information Officer. Persons below poverty line are not required to remit the application fee.

28 Rule 4 Karnataka Right to Information Rules, 2005

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However, they are required to produce BPL certificate from the Block Development Officer29.

Rajasthan Right to Information (High Court & Subordinate Courts) Rules, 2006 provides that “Any person seeking information under the Act shall make an application in Form ‘A’ to the Authorized Person along with non-judicial stamp, of Rs. 100 duly affixed on/attached to it, which shall be nonrefundable. Where the information relates to tender documents/bids/quotation/business contract, the application fee shall be Rs. 500 per application”.30 Further Rule 9 stipulates that “If the applicant seeks inspection of record only, he shall submit application in Form ‘A’ along with Rs. 100/- in the shape of non-judicial adhesive stamp. The Authorized person shall examine the application and may allow or by written order refuse to allow such inspection. In the later case the copy or refusal order will be provided free of charge to the applicant. If the application is allowed, no inspection fee shall be charged for first sixty minutes but thereafter the applicant shall submit fee amounting Rs. 25/- for every additional 15 minutes or part thereof which shall also be paid in shape of non-judicial adhesive stamp. In no case such inspection shall continue for more than two hours in all.

It is evident from above analysis that some states charge different fees and modes of payment are also varied. Application fee should be minimal and uniform all over the country. Similarly, the charges for obtaining information should also be minimal, uniform and reasonable so that the same are not beyond the reach of common people. Section 6 & 7 of the RTI Act should be amended which would direct the States not to charge more fee than the prescribed by the Central Government. However, the State Government may be at liberty to charge lesser fee than prescribed by the Central Government. It has been noticed that there are different modes of payment of fee under the Act, which may provide an opportunity to the public authority to victimize applicants and moreover the existing process of payment is not convenient to general public. Therefore there is a need to simplify the process for the benefit of common man.

4.3. Penal provision for violation of Section 4 of the ActPublic authority is required to make pro-active disclosure of all the relevant information as per provisions of Section 431 of the RTI Act , unless the same is exempt under the

29 Rule 4 of the Kerala Right to Information (Regulation of Fee and cost) Rules, 200630 Rules 4 Of The Rajasthan Right To Information (High Court & Subordinate Courts) Rules, 2006

31 Section 4. (1) Every public authority shall—

a) maintain all its records duly catalogued and indexed in a manner and the form which facilitates the right to information under this Act and ensure that all records that are appropriate to be computerised are, within a reasonable time and subject to availability of resources, computerised and connected through a network all over the country on different systems so that access to such records is facilitated;

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provisions of Section.8(1). In fact an information regime should be created such that citizens would have easy access to information without making any formal request for it. Section 4 (2) and (3) of the RTI Act call for continuous improvement of publication of voluntary disclosures

It has been noticed that public authorities covered under the Act, do not seriously implement the provisions of section 4 of the Act, because there is no penal provision for the violation. The position of the author has been vindicated by the circular issued by the CIC. The Circular of the CIC reads as “The Central lnformation Commission in a case has highlighted that the systematic failure in maintenance of records is resulting in supply of incomplete and misleading information and that such failure is due to the fact that the public authorities do not adhere to the mandate of Section 4(l)(a) of the RTI Act, which requires every public authority to maintain all its records duly catalogued and indexed in a manner and form which would facilitate the right to information. The Commission also

b) publish within one hundred and twenty days from the enactment of this Act,—

(i) the par ticulars of its organisation, functions and duties; (ii) the powers and duties of its officers and employees; (iii) the procedure followed in the decision making process, including channels of supervision and accountability; (iv) the norms set by it for the discharge of its functions; (v) the rules, regulations, instructions, manuals and records, held by it or under its control or used by its employees for discharging its functions; (vi) a statement of the categories of documents that are held by it or under its control; (vii) the particulars of any arrangement that exists for consultation with, or representation by, the members of the public in relation to the formulation of its policy or implementation thereof; (viii) a statement of the boards, councils, committees and other bodies consisting of two or more persons constituted as its part or for the purpose of its advice, and as to whether meetings of those boards, councils, committees and other bodies are open to the public, or the minutes of such meetings are accessible for public; (ix) a directory of its officers and employees; (x) the monthly remuneration received by each of its officers and employees, including the system of compensation as provided in its regulations; (xi) the budget allocated to each of its agency, indicating the particulars of all plans, proposed expenditures and reports on disbursements made; (xii) the manner of execution of subsidy programmes, including the amounts allocated and the details of beneficiaries of such programmes; (xiii) particulars of recipients of concessions, permits or authorisations granted by it; (xiv) details in respect of the information, available to or held by it, reduced in an electronic form; (xv) the particulars of facilities available to citizens for obtaining information, including the working hours of a library or reading room, if maintained for public use; (xvi) the names, designations and other particulars of the Public Information Officers; (xvii) such other information as may be prescribed; and thereafter update these publications every year; c) publish all relevant facts while formulating important policies or announcing the decisions which affect public; d) provide reasons for its administrative or quasi-judicial order

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pointed out that such a default could qualify for payment of compensation to the complainant. Section 19(8)(b) of the Act gives power to the Commission to require the concerned public authority to compensate the complainant for any loss or other detriment suffered. The CIC directed that the proper maintenance of records is vital for the success of the Right to lnformation Act.32 It is mandatory for all the public authorities to adhere to the principle of maximum disclosure, and furnish the information, as and when sought by the citizens, for which they do not have to charge any extra money, other than what has been prescribed by the Govt. under the RTI fees and costs rules.33.

Applicant has to prove that he suffered loss due to such non-display then only he may be awarded some compensation. A citizen can complain because the Department has not updated their information, thus causing damage and risk34. It is clear that the Act puts an obligation upon public authority to provide information as mentioned in section 4, on its web sites. But the Act does not provide any penalty for volition of Section 4 of the Act. So it is need of the hour to provide for some penal provision for violation of Section 4, which would ensure effective compliance on the issue and would also deter applicants from approaching Public Information Officer as the information would be made available to them.

It is also recommended, as a preventive measure, that besides penalty for violation of section 4, non-display of information under section 4 should be treated as deficiency in service under the Consumer Protection Act 1986 and the Consumer Forums constituted under the Consumer Protection Act 1986, should be empowered to take cognizance of such failure in case of loss suffered by applicant due to non display of some information under section 4 of the RTI Act.

4.4. Regulation of inspection of documents under the Act An analysis of section 2(f), section 6 Section 7 of the Act depicts that none of the provisions provide time frame for inspection of documents. Section7 35 provides for time

32 N0.12/192/2009-1R Government of India Ministry of Personnel, Public Grievances and Pensions (Department of Personnel & Training) New Delhi Dated the 20Ih January 201033 204/IC(A)/2006- Government of India Ministry of Personnel, Public Grievances and Pensions (Department of Personnel & Training) New Delhi dated 25.8.200634 CIC/WB/C/2006/00081- 13 July,2006

35 Section 7. (1) Subject to the proviso to sub-section (2) of section 5 or the proviso to sub-section (3) of section 6, the Central Public Information Officer or State Public Information Officer, as the case may be, on receipt of a request undersection 6 shall, as expeditiously as possible, and in any case within thirty days of the receipt of the request, either provide the information on payment of such fee as may be prescribed or reject the request for any of the reasons specified in sections 8 and 9:

Provided that where the information sought for concerns the life or liberty of a person, the same shall be provided within forty-eight hours of the receipt of the request.

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limit in which the PIO must furnish the desired information to the applicant but silent on the time limit for inspection of files or documents under the Act. Section 6 36 stipulates the procedure for submission of RTI Application before PIO/APIO for ascertain information under the ambit of the RTI Act whereas it does not contain any provision as to procedure for submission of application for inspection. It provides opportunity to Public authority for manipulation of the documents sought by the applicants. It is recommended that some provision on the time limit for inspection and procedure for submission of inspection application should be provided in the Act.

5. Conclusion

Corruption is a curse on the society. It has been encouraging immoral and other illegal activities in fields of economic, politics, and social. Consequently beliefs and moral

(2) If the Central Public Information Officer or State Public Information Officer, as the case may be, fails to give decision on the request for information within the period specified under sub-section (1), the Central Public Information Officer or State Public Information Officer, as the case may be, shall be deemed to have refused the request.

(3) Where a decision is taken to provide the information on payment of any further fee representing the cost of providing the information, the Central Public Information Officer or State Public Information Officer, as the case may be, shall send an intimation to the person making the request, giving—

(a) the details of further fees representing the cost of providing the information as determined by him, together with the calculations made

36 Section 6. (1) A person, who desires to obtain any information under this Act, shall make a request in writing or through electronic means in English or Hindi or in the official language of the area in which the application is being made, accompanying such fee as may be prescribed, to—

(a) the Central Public Information Officer or State Public Information Officer, as the case may be, of the concerned public authority;

(b) the Central Assistant Public Information Officer or State Assistant Public Information Officer, as the case may be, specifying the particulars of the information sought by him or her:

Provided that where such request cannot be made in writing, the Central Public Information Officer or State Public Information Officer, as the case may be, shall render all reasonable assistance to the person making the request orally to reduce the same in writing.

(2) An applicant making request for information shall not be required to give any reason for requesting the information or any other personal details except those that may be necessary for contacting him.

(3) Where an application is made to a public authority requesting for an information,—

(i) which is held by another public authority; or (ii) the subject matter of which is more closely connected with the functions of another public authority,

the public authority, to which such application is made, shall transfer the application or such part of it as may be appropriate to that other public authority and inform the applicant immediately about such transfer:

Provided that the transfer of an application pursuant to this sub-section shall be made as soon as practicable but in no case later than five days from the date of receipt of the application

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values of the society have been shattered. People lack faith in the administration on the nation. Government officials do not consider transparency and accountability as part of their official conduct, which lead to corrupt activities and manipulation of the official resources.The RTI Act is a historical and comprehensive legislation that consider legal rights on citizens for seeking information from public and selected private authorities. The Act was enacted to make a watershed in this nation’s democratic development. It has long proven to be a key component of a health democracy because it empowers citizens with the right to demand what activities and decisions are being made in their names. The Act has given hope to society in reducing corruption at any level of bureaucracy. The movement has been gaining momentum through the innovativeness and preservance shrouded by activists in various states on its use.

The States are in the process of creating the needed infrastructure in their department to provide information sought by any agency. But states RTI laws left much to be desired in implementing the enactment and subject to individual interpretation in each state. The action against errant officials is still dependent on the already discredited and cumbersome proceedings of the civil service conduct rules.

The Act, if effectively implemented, could change the nature of governance in the nation. The process of transparency and accountability in the governmental institutions should be initiated on priority, which would bring a sense of empowerment to the citizens as to check the government performance and accountability. It is in sprouted form and need to be nourished well for effective and efficient implementation. Awareness regarding the provisions of the act should be created through various means of media. Success of the program depends upon the alertness of the citizens, in claiming their legal rights on the subject. Proper propagation and promotion of the subject is the key in the reducing corruption and promoting transparency and accountability in the era of globalization and liberalization.

It is recapitulated that penal provision for violation of Section 4 should be inserted in Section 20. There is a need to ensure uniformity in fee and inspection charges payable by applicant to Public Authority under the Act. It has been evident that procedure for payment of fee under the Act is complex and inconvenient for general public, where they are required to pay the fee by different modes, which give opportunity to PIO to harass applicant. Cash payment should be accepted for fee payable under the Act, which is very convenient and applicant is saved from bueareaucratic hassle in respect to payment of application /inspection/appeal fee through various modes. Alternatively the author strongly recommends that applicant should not be charged anything for submitting application under the RTI Act, 2005. It is also observed that the Act does not provide any qualifications for the appointment of PIO. It is strongly recommended that permanent

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employee, not part time or adhoc or temporary employee should be appointed as PIO/APIO. It is evident from existing ground reality that temporary/adhoc employees are puppet in the hands of public authority and they can never go against the interest of their organizations, otherwise their job would be at stake. Further imposition of penalty on them, in case of violation of any provision s of the Act, would aggravate their condition.

It is proved beyond doubt that the Right to Information Act has become a ‘Brahmastra’ (weapon) of general public against the corrupt bureaucrats. The right to information has certainly created an impact on accountability and transparency in the administration of the nation. These initiative/recommendations of the researcher would certainly minimize if not eliminate the hostile attitude of Public authority towards the implementation of the RTI Scheme

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