Punjab-Haryana High Court
The Associated Cement Companies ... vs State Of Haryana And Others on 7 February, 2013
Author: Ajay Kumar Mittal
Bench: Ajay Kumar Mittal
CWP No. 10445 of 1994 -1-
IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH
CWP No. 10445 of 1994
Date of Decision: 7.2.2013
The Associated Cement Companies Limited and another
....Petitioners.
Versus
State of Haryana and others
...Respondents.
CORAM:- HON'BLE MR. JUSTICE AJAY KUMAR MITTAL.
PRESENT: Mr. M.L. Sarin, Senior Advocate with
Mr. Nitin Sarin, Advocate for the petitioners.
Mr. S.S. Pattar, Senior DAG, Haryana.
Mr. Vikas Suri, Advocate for respondents No.3 and 4.
AJAY KUMAR MITTAL, J.
1. Challenge in this writ petition filed under Articles 226/227 of the Constitution of India is to the order dated 27.7.1994 (Annexure P-1) passed by respondent No.2.
2. Put shortly, the relevant facts necessary for adjudication as narrated in the petition are that the petitioner-company is engaged in the manufacture of cement of all kinds in various factories located in India and had one of its factories at Surajpur and Rajipur Jhajra, Tehsil Kalka, District Ambala called Bhupendra Cement Works and B.C. W. Surajpur. The factory of the petitioner-company is situated at Surajpur, Tehsil Kalka, District Ambala in the State of Haryana having a population of approximately not more than 20000. The petitioner-company has its CWP No. 10445 of 1994 -2- separate colony for the employees and has residential houses for its employees and the houses are provided all modern facilities. The company has also provided roads, schools and hospital etc. in the colony of the factory situated at Surajpur. The hospital is equipped with all modern facilities and having a capacity of 22 beds manned by qualified medical practitioners and other paramedical staff. Free treatment is given to the employees and their dependants and near relations. The company also provides medical leave and special medical leave to its employees. The petitioner-company is having about 1000 employees working in the Surajpur factory including the workers employed at Malla quarry. Out of these employees, only 200 employees are drawing less than Rs.3000/- per month whereas the employees working in Malla quarry are not covered under the provisions of the Employees State Insurance Act (in short "the Act"). The remaining employees who are drawing more than Rs.3000/- per month are also not covered under the provisions of the Act. The rate of minimum daily wages applicable to the petitioner-company was Rs.120/- per day and therefore, none of the employees of the company was covered under the provisions of the Act as they were drawing more than Rs.3000/- per month. In the year 1970, the petitioner-company moved an application to respondents No.1 and 2 for exemption from the provisions of the Act who being fully satisfied exempted the petitioner-company from the provisions of the Act by issuing notifications from time to time. The petitioner-company vide application dated 16.11.1993 (Annexure P-2) applied for renewal of exemption from the provisions of the Act for the period from 1.10.1993 to 30.9.1994 on the similar grounds as the earlier exemption granted vide notification dated 23.12.1993 (Annexure P-3) CWP No. 10445 of 1994 -3- was only upto 30th September, 1993. Respondent No.2 vide order dated 27.7.1994 (Annexure P-1) rejected the said application moved by the petitioner-company without assigning any reason. Hence, the present writ petition.
3. Learned counsel for the petitioners submitted that the respondents had granted exemption from the provisions of the Act for the period from 1970 till 30.9.1993 on yearly basis. Subsequent thereof, application for renewal of exemption under the provisions of Section 87 of the Act for the period from 1.10.1993 to 30.9.1994 was declined by respondent No.2 vide order dated 27.7.1994 (Annexure P-1) without affording an opportunity of hearing to the petitioners. It was also urged that the impugned order was a non-speaking order and was liable to be quashed in view of law enunciated in Chet Singh v. State of Punjab and others, 1977 PLJ 228 and Mohinder Singh Gill and another v. The Chief Election Commissioner, New Delhi and others AIR 1978 SC 851.
4. On the other hand, learned counsel for the respondents supported the order passed by respondent No.2.
5. After hearing learned counsel for the parties, I find merit in the contentions raised by the learned counsel for the petitioners.
6. The order impugned herein (Annexure P-1) reads thus:-
"On the basis of advice of ESIC Govt. is unable to accept proposal for grant of exemption from the provisions of ESI Act to the ACC Ltd. Surajpur (Ambala) ESI Scheme must be made applicable to the ACC Ltd. Surajpur (Ambala)."
7. A perusal of the above order shows that it is neither CWP No. 10445 of 1994 -4- speaking nor has been passed after considering the objections raised by the petitioners. Further, it was not disputed that the petitioners have been granted exemption from the provisions of the Act from 1970 till 30.9.1993 on yearly basis. Once the petitioners were found entitled to exemption for about 23 years, departure from the same required to be specifically dealt with by the respondent-State by passing a speaking order after affording an opportunity of hearing to the petitioners.
8. The Hon'ble Apex Court in Canara Bank v. V.K. Awasthy AIR 2005 SC 2090 while dealing with the doctrine of principles of natural justice had noticed as under:-
"9. Natural justice is another name for commonsense 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 commonsense 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.
10. The expressions "natural justice'' and "legal justice'' do not present a water-tight 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 CWP No. 10445 of 1994 -5- 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 litigants' defence.
11. 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 appraise the party determinatively 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. The concept has gained significance and shades with time. When the CWP No. 10445 of 1994 -6- historic document was made at Runnymede in 1215, the first statutory recognition of this principle found its way into the "Magna Carta''. The classic exposition of Sir Edward Coke of natural justice requires to "`vocate interrogate and adjudicate''. In the celebrated case of Cooper v. Wandsworth Board of Works, (1963) 143 ER 414, the principle was thus stated:
"Even God did not pass a sentence upon Adam, before he was called upon to make his defence. "Adam'' says God, "where art thou has thou not eaten of the tree whereof I commanded thee that though should not eat''.
12. Since then the principle has been chiselled, honed and refined, enriching its content. Judicial treatment has added light and luminosity to the concept, like polishing of a diamond.
13. Principles of natural justice are those rules which have been laid down by the Courts as being the minimum protection of the rights of the individual against the arbitrary procedure that may be adopted by a judicial, quasi-judicial and administrative authority while making an order affecting those rights. These rules are intended to prevent such authority from doing injustice."
9. Further, delving into the issue relating to the passing of the speaking order by an authority whether administrative or quasi judicial , it was laid down by the Hon'ble Supreme Court in M/s Kranti Associates CWP No. 10445 of 1994 -7- Pvt. Ltd. and another v. Sh. Masood Ahmed Khan and others, (2010) 9 SCC 496 as under:-
"17. The expression `speaking order' was first coined by Lord Chancellor Earl Cairns in a rather strange context. The Lord Chancellor, while explaining the ambit of Writ of Certiorari, referred to orders with errors on the face of the record and pointed out that an order with errors on its face, is a speaking order. (See 1878-97 Vol. 4 Appeal Cases 30 at 40 of the report).
18. This Court always opined that the face of an order passed by a quasi-judicial authority or even an administrative authority affecting the rights of parties, must speak. It must not be like the 'inscrutable face of a Sphinx'.
19 to 50 XX XX XX
51. Summarizing the above discussion, this Court holds:
a. In India the judicial trend has always been to record reasons, even in administrative decisions, if such decisions affect anyone prejudicially. b. A quasi-judicial authority must record reasons in support of its conclusions.
c. Insistence on recording of reasons is meant to serve the wider principle of justice that justice must not only be done it must also appear to be done as well.CWP No. 10445 of 1994 -8-
d. Recording of reasons also operates as a valid restraint on any possible arbitrary exercise of judicial and quasi-judicial or even administrative power.
e. Reasons reassure that discretion has been exercised by the decision maker on relevant grounds and by disregarding extraneous considerations.
f. Reasons have virtually become as
indispensable a component of a decision
making process as observing principles of natural justice by judicial, quasi-judicial and even by administrative bodies.
g. Reasons facilitate the process of judicial review by superior Courts.
h. The ongoing judicial trend in all countries committed to rule of law and constitutional governance is in favour of reasoned decisions based on relevant facts. This is virtually the life blood of judicial decision making justifying the principle that reason is the soul of justice.
i. Judicial or even quasi-judicial opinions these days can be as different as the judges and authorities who deliver them. All these decisions serve one common purpose which is to demonstrate by reason that the relevant factors have been objectively considered. This is important for sustaining the litigants' faith in the justice CWP No. 10445 of 1994 -9- delivery system.
j. Insistence on reason is a requirement for both judicial accountability and transparency.
k. If a Judge or a quasi-judicial authority is not
candid enough about his/her decision
making process then it is impossible to know whether the person deciding is faithful to the doctrine of precedent or to principles of incrementalism.
l. Reasons in support of decisions must be
cogent, clear and succinct. A pretence of
reasons or 'rubber-stamp reasons' is not to be equated with a valid decision making process. m. It cannot be doubted that transparency is the sine qua non of restraint on abuse of judicial powers. Transparency in decision making not only makes the judges and decision makers less prone to errors but also makes them subject to broader scrutiny. (See David Shapiro in Defence of Judicial Candor (1987) 100 Harward Law Review 731-737).
n. Since the requirement to record reasons emanates from the broad doctrine of fairness in decision making, the said requirement is now virtually a component of human rights and was considered part of Strasbourg Jurisprudence. See (1994) 19 EHRR 553, at 562 para 29 and Anya vs. University of Oxford, 2001 EWCA Civ 405, wherein the Court referred to Article 6 of European Convention of CWP No. 10445 of 1994 -10- Human Rights which requires, "adequate and intelligent reasons must be given for judicial decisions".
o. In all common law jurisdictions judgments play a vital role in setting up precedents for the future. Therefore, for development of law, requirement of giving reasons for the decision is of the essence and is virtually a part of "Due Process".
10. In view of the above, the order (Annexure P-1) being a non- speaking order and passed in violation of the principles of natural justice as per law laid down by the Hon'ble Supreme Court in V.K. Awasthy and M/s Kranti Associates Pvt. Ltd's cases (supra) is hereby quashed. Accordingly, the matter is remitted to respondent No.2 to pass a fresh speaking order after affording an opportunity of hearing to the petitioners in accordance with law within a period of three months from the date of receipt of a certified copy of this order.
February 7, 2013 (AJAY KUMAR MITTAL) gbs JUDGE