Madras High Court
Philip Jeyasingh vs The Joint Registrar Of Co-Operative ... on 22 January, 1992
Equivalent citations: (1992)2MLJ309
ORDER Srinivasan, J.
1. The question referred to us is:
Can the judgment of the Full Bench in R.Tamilarasan v. Director of Handlooms and Textiles (1989)1 L.L.J. 588, be characterised as one per incuriam or "obiter dicta", as opined by the Division Bench of this Court in A.Natarajan v. Registrar of Co-operative Societies (1991)2 M.L.J. 63 : (1991)2 L.L.J. 296'?
II. Full Benches.
2. This is the first time in the long history of this Court, the judgment of a Full Bench is thrown over-board with the label per incuriam and brushed aside as 'obiter dicta' by a Division Bench. It is common knowledge that Full Benches are constituted specially for deciding specific questions referred to them. The judgment of the Full Bench is binding precedent as it expresses the collective opinion of the Court as such. It is binding on a single Judge as well as a Division Bench until it is reversed by a higher court. Mere expression of dissatisfaction by their Lordships of the Privy Council about the principles decided by a Full Bench of a High Court was not sufficient to take away their authority until the Privy Council expressed a definite disagreement with them. Vide Anant Ram andothers v. Khushal Singh and Ors. A.I.R. 1927 All. 244. In Gundavarapu Seshamma v. Kornepati Venkata Narasimha Rao and Ors. (1940)1 M.L.J. 400 : I.L.R. 1940 Mad. 454 : 51 L. W. 408 : A.I.R. 1940 Mad. 356 (F.B.) a Full Bench is a final court of Appeal in an Indian High Court, unless the case, is referred to a Full Bench, and one Division Bench should regard itself bound by the decision of another Division Bench on a question of law and if the later Bench does not accept as correct the decision of the earlier Bench, the only right and proper course to adopt is to refer the matter to a Full Bench. The Full Bench pointed out that if the said course was not adopted, the courts subordinate will be left without guidance and there would be loss of money and waste of judicial time. in Ningappa v. Emperor A.I.R. 1941 Bom. 408, Beamont C.J., observed that a later Full Bench cannot overrule an earlier Full Bench merely because the later Bench comprised of more Judges. He expressed himself thus:
There can be no doubt that a Full Bench can overrule a Division Bench, and that a Full Bench must consist of three or more Judges; but it would seem anomalous to hold that a later Full Bench can overrule an earlier Full Bench, merely because the later Bench consists of more Judges than the earlier. If that were the rule, it would mean that a bench of seven Judges, by a majority of four to three, could overrule a unanimous decision of a bench of six Judges, though all the Judges were of co-ordinate jurisdiction. In Enamullah v. Kowsher All, 54 Cal. 266, Sanderson, C.J. stating the practice in Calcutta seems to have been of opinion that a decision of a Full Bench could only be reversed by the Privy Council or by a bench specially constituted by the Chief Justice. Even if this be the true rule, there is nothing to show that the Chief Justice acted upon it in Emperor v. Purushottam Ishwar 45 Bom. 834. I do not recollect myself over to have constituted Special Bench to consider the ruling of a Full Bench, though I have constituted many Full Benches to consider rulings of Division Benches.
In K.R. Sankaralingam Pillai and Anr. v. Veluchami Pillai and Ors. (1942)2 M.LJ. 678 : 205 I.C. 1 : I.L.R. 1943 Mad. 509 : A.I.R. 1943 Mad. 43 : 55 L. W. 794, a Full Bench of this Court went to the extent of holding that an obiter dictum of a Chief Justice delivering the judgment of a Full Bench was entitled to great weight.
III. Precedents.
3. In Mahadeolal Komadia v. The Administrator General of West Bengal , it was ruled thus:
We have noticed with some regret that when the earlier decision of two Judges of the same High Court in Deorajan 's case , was cited before the learned Judges who heard the present appeal they took on themselves to say that the previous decision was wrong, instead of following the usual procedure in case of difference of opinion with an earlier decision, of referring the question to a larger Bench. Judicial decorum no less than legal propriety forms the basis of judicial procedure. 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 co-ordinate 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.
(20) As far as we are aware it is the uniform practice in all the High Courts in India that if one Division Bench differs from an earlier view on a question of law of another Division Bench, a reference is made to a larger Bench. In Calcutta High Court a rule to this effect has been in existence since 1867. It is unfortunate that the attention of the learned Judges was not drawn in the present case to that rule. But quite apart from any rule, considerations of judicial propriety and decorum ought never to be ignored by courts in such matters.
4. In Jai Kaur v. Sher Singh , the Supreme Court held that a subsequent Division Bench cannot disagree with a previous decision of the Full Bench of the same Court. Referring to the above ruling in Mahadeolal Komadia v. The Administrator General of West Bengal , the Court observed.
If, as we pointed out there, considerations of judicial decorum and legal propriety require that Division Benches should not themselves pronounce decisions of other Division Benches to be wrong, such considerations should stand even more firmly in the way of Division Benches disagreeing with a previous decision of the Full Bench of the same court.
5. Reiterating the ruling in Mahadeolal Komadia v. The Administrator General of West Bengal , the Supreme Court in JaisriSahu v. Rajdewan Dubey and Ors. , observed as follows after quoting with approval a passage in the judgment of the Full Bench of this Court in Seshamma's case (1940)1 M.L.J. 400: I.L.R. 1940 Mad. 454 : 51 L.W. 408 : A.I.R. 1940 Mad. 356 (F.B.):
Law will be bereft of all its utility if it should be thrown into a state of uncertainty by reason of conflicting decisions and it is therefore desirable that in case of difference of opinion, the question should be authoritatively settled.
6. In Somawami v. State of Punjab , it is held that the binding effect of a decision does not depend upon whether a particular argument was considered therein or not, provided that the point with reference to which an argument was subsequently advanced was actually decided. This principle is reiterated in T.G.Mudaliar v. State of Tamil Nadu ; Anil Kumar Neotia v. Union of India and Kesho Ram and Company v. Union of India .
7. In Kamalammal v. Venkatalakshmi , the Supreme Court deprecated the course taken by a single Judge of a High Court in refusing to follow the judgment of a Full Bench and ruled that not merely convention but rules framed by several High Courts require that where a learned single Judge or a Division Bench does not agree with a Full Bench decision, he or they either make a reference to the Full Bench or place the papers before the Chief Justice for such a reference being made. A similar ruling was rendered in Lala Shri Bhagwan and Anr. v. Ram Chand and Anr. .
8. In Punam Chand v. Subhakaran , a Division Bench held that a Full Bench decision is always binding on a Division Bench unless and until the same is overruled by the Supreme Court.
9. In Ballabhdas Mathuradas Lakani and Ors. v. Municipal Committee, Malkapur , it is held that the decision of the Supreme Court was binding on the High Court and the latter could not ignore it because they thought that relevant provisions were not brought to the notice of the Supreme Court.
10. In Sri Venkateswara Rice, Ginning and Groundnut Oil Mill Contractors Company, etc. v. The State of A.P. and Ors. , it was observed:
It is strange that a co-ordinate Bench of the same High Court should have tried to sit on judgment over a decision of another Bench of that Court. It is regrettable that the learned Judges who decided the latter case overlooked the fact that they were bound by the earlier decision.
11. In Punjab University v. Vijay Singh Lamba , though the Court recognised that judicial consistency was not the highest state of legal bliss, law must grow and it cannot afford to be static, observed that precedents should be stepping stones and not halting places; but at the same time cautioned that the weekly change in the composition of the court ought not to be accompanied by changes in its rulings.
12. In Eknath Shankarrao Mukhawar v. State of Maharashtra , it was held that judicial discipline as well as decorum suggested only one course when a Bench wanted to differ from the decision of a co-ordinate court and that was to refer to a larger Bench.
13. In Balakrishna Rao v. Haji Abdulla Sail (1980)1 M.L.J. (S.C.) 20: (1980)93 L.W.9 (S.N.), the Supreme Court frowned upon the Division Bench of this Court which bypassed the ruling of an earlier Division Bench on the ground that a particular argument was not considered in the earlier case. Reiterating the principles laid down in Somawanti v. State of Punjab and Mahadeolal Komadia v. The Administrator General of West Bengal , the Court observed that the Division Bench should have followed the procedure of referring the matter to a Full Bench in that case.
14. In Pritam Kaur v. Surjit Singh , Sandhawalia, C.J. presiding over a Full Bench traced the law of precedents in detail. Referring to the decisions of English Courts and the Supreme Court of India he observed,
9. It would thus follow that once a precedent is held to be a binding one, then no deviation therefrom is permissible within the judicial polity except in the well accepted categories of cases enumerated hereafter in para 12 of this judgment.
10. It is equally necessary to highlight that the binding nature of precedents generally and of Full Benches in particular is the kingpin of our judicial system. It is the bond that binds together what otherwise might well become a thicket of individualistic opinions resulting in a virtual judicial anarchy. This is a self-imposed discipline which rightly is the envy of other Schools of Law. Because of the legal position here being axiomatic and well-settled it is unnecessary to elaborate the issue on principle.
11. Now apart from Full Benches and the precedents of the Superior Court, it would appear that even judgments of the Benches of the same High Court in a limited way are binding in the sense that a judgment cannot be rendered contrary to the earlier decision of co-equal Bench. At the highest, an equivalent Bench can seek reconsideration of the same by a larger Bench.
12. From the above, it would follow as a settled principle that the law specifically laid down by the Full Bench is binding upon the High Court within which it is rendered and any and every veiled doubt with regard thereto does not justify the reconsideration thereof by a larger Bench and thus put the law in a ferment afresh. The ratios of the Full Benches are and should be arrested on surer foundations and are not to be blown away by every side wind.
It is only within the narrowest field that a judgment of a larger Bench can be questioned for reconsideration. One of the obvious reasons is, where it is unequivocally manifest, that its ratio has been impliedly overruled or whittled down by a subsequent judgment of the superior Court or a larger Bench of the, same Court. Secondly, where it can be held with certainty that a co-equal Bench has laid the law directly contrary to the same. And, thirdly, where it can be conclusively said that the judgment of the larger Bench was rendered per incuriam by altogether failing to take notice of a clear-cut statutory provision or an earlier binding precedent. It is normally within these constricted parameters that a smaller Bench may suggest a reconsideration of the earlier view and not otherwise. However, it is best in these matters to be neither dogmatic nor exhaustive yet the aforesaid categories are admittedly the well-accepted ones in which an otherwise binding precedent may be suggested for reconsideration.
(Emphasis supplied)
14. However, it is equally apt to elaborate what cannot be a valid ground for questioning or reconsidering, the law settled by a larger Bench. The very use of the word 'binding' would indicate that it would hold the field despite the fact that the Bench obliged to follow the same may not, itself be in agreement at all with the view. It is a necessary discipline of the law that the judgments of the superior courts and of larger Benches have to be followed unhesitatingly whatever doubts one may individually entertain about their correctness. The rationale for this is plain because to seek a universal intellectual unanimity is an ideal too Utopian to achieve. Consequently, the logic and the rationale upon which the ratio of a larger Bench is rested, are not matters open for reconsideration. Negatively put, therefore, the challenge to the rationale and reasoning of a larger Bench is not a valid ground for unsettling it and seeking a re-opening and re-examination of the same thus putting the question in a flux afresh.
16. The argument aforesaid is plainly untenable on principle. If the ratios of larger Benches and the judgments of superior courts were to be merely rested upon the quicksands of the ingenuity of the counsel to raise some fresh or novel argument (which had not been earlier raised or considered) in order to dislodge them, then the hallowed rule of the finality of binding precedent would become merely a teasing mirage. It seems unnecessary to elaborate this aspect because it is clearly concluded by binding precedent.
15. In Ayyaswami Gounder v. Munuswamy Gounder , it was held that a single Judge of a High Court not agreeing with earlier decision of single Judge of the same Court, should refer the matter to a larger Bench and propriety and decorum do not warrant his taking a contrary view.
16. In Sonal Sihimappa v. State of Karnataka and Ors. A.I.R. 1987 S.C. 2359, it was observed, In a precedent-bound judicial system, binding authorities have got to be respected and the procedure for developing the law has to be one of evolution.
17. In S.I.P. Corporation of Tamil Nadu Ltd. v. Arputharaj , a Division Bench comprising two of us reiterated the law of precedents in the following words:
In such a contingency, sitting as we do, as Judges of a Division Bench of this Court, we are bound by the interpretation and preference given by the Full Bench of this Court. This will be in consonance with the decorum of our, judicial functioning. It is well settled that an interpretation (and equally a misinterpretation) by a larger Bench of the High Court, of a decision or decisions of the Supreme Court is binding on a smaller Bench of the same Court, and the latter cannot refuse to follow the decision of larger Bench, on the ground that the larger Bench has wrongly understood or construed the decisions of the Supreme Court. Taking note of this principle, we are obliged to hold that the appellants could not be held to have locus standi to prefer and prosecute these writ appeals.
18. In Sundaradas Kanyalal Bhathija v. The Collector, Thane , the law is stated thus:
17. It would be difficult for us to appreciate the judgment of the High Court. One must remember the pursuit of the law, however glamorous it is, has its own limitation on the Bench. In a multi-Judge Court, the Judges are bound by precedents and procedure. They could use their discretion only when there is no declared principle to be found, no rule and no authority. The judicial decorum and legal propriety demand that where a learned single Judge or a Division Bench does not agree with the decision of a Bench of co-ordinate jurisdiction, the matter shall be referred to a larger Bench. It is subversion of judicial process not to follow this procedure.
xx xx xx
20. The Chief Justice Pathak, in a recent decision stressed the need for a clear and consistent enunciation of legal principle in the decisions of a Court. Speaking for the Constitution Bench Union of India v. Raghubir Singh , learned Chief Justice said: (S.C.C. p. 766: A.I.R. p. 1939) The doctrine of binding precedent has the merit of promoting a certainty and consistency in judicial decisions, and enables an organic development of the law, besides providing assurance to the individual as to the consequence of transactions 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.
Cardozo propounded a similar thought with more emphasis:
I am not to mar the symmetry of the legal structure by the introduction of inconsistencies and irrelevancies and artificial exceptions unless for some sufficient reason, which will commonly be some consideration of history or custom or policy or justice. Lacking such a reason, I must be logical justice as I must be impartial, and upon like grounds, it will not do to decide the same question one way between another. (The Nature of the Judicial Process by Benjamin N. Cardozo p.3). Judicial Process by Benjamin, N. Cardozo p.3).
21. 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 Court and Tribunals to make the law more predictable. The questions 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. Subordinate Courts would find themselves in an embarrassing position to choose between the conflicting opinions. The general public would be in dilemma whether to obey or not to obey such law and it ultimately falls into disrepute.
22. Judge Learned Hand has referred to the tendency of some judges who win the game by sweeping all the chessmen off the table. (The Spirit of Liberty by Alfred A Knopf, New York (1953) p.131). This is indeed to be deprecated. It is needless to state that the judgment of superior courts and Tribunals must be written only after deep travail and positive vein. One should never let a decision go until he is absolutely sure it is right. The law must be made clear, certain and consistent. But certitude is not the test certainty and consistency does not mean that there should be no word of new content. The principle of law may develop side by side with new content but not inconsistencies. There could be waxing and waning the principle depending upon the pragmatic needs and moral yearnings. Such development of law particularly, is inevitable in our developing country. In Union of India v. Raghubir Singh , learned Chief Justice Pathak had this to say :
Legal compulsions cannot be limited by existing legal propositions, because, there will always be, beyond the frontiers of the existing law, new areas inviting judicial scrutiny and judicial choice-making which could well affect the validity of existing legal dogma. The search for solutions responsive to a changed social era involves a search not only among competing propositions of law, or competing versions of a legal proposition, or the modalities of an indeterminacy such as fairness or reasonableness, but also among propositions from outside the ruling law, corresponding to the empirical knowledge or accepted values of present time and place, relevant to the dispensing of justice within the new parameters.
And he continued:
The universal problem presented for judicial choice-making at the growing points of the law is an expanding universe. The areas brought under control by the accumulation of past judicial choice may be large. Yet the areas newly presented for still further choice, because of changing social, economic and technological conditions are far from inconsiderable. It has also to be remembered, that many occasions for new options arise by the mere fact that no generation looks out on the world from quite the same vantage-point as its predecessor, nor for that matter with the same perception. A different vantage-point or a different quality of perception often reveals the need for choice making formerly no alternatives, and no problems at all, were perceived.
Holmes tells us:
The truth is, that the law is always approaching, and never reaching, consistency. It is forever adopting new principles from life at the end, and it always retains old ones from history at the other, which have not yet been absorbed or sloughed off. It will become entirely consistent only when it ceases to grow. (Holmes the Common Law,p.36 (1881).
19. Thus, the law of precedents has been uniform throughout the country for over a century. Occasional aberrations by Judges sitting singly or in Division Benches have not only been frowned upon, but condemned outright by higher Courts. The following principles can be culled out from the myriad case laws, (a) A Single Judge is bound by the decision of a Division Bench and if he does not agree with it, he shall refer the matter to a larger Bench (b) A fortiori, he is bound by the Judgment of a Full Bench and if he does not agree with its ratio, he shall place the papers before the Chief Justice to consider whether a larger Bench should be constituted for considering the question (c) A Division Bench is bound by the decision of another Division Bench and if it wants to differ, it shall refer the matter to the Full Bench (d) A fortiori a Division Bench is bound by the decision of a Full Bench and if it wants to differ, it shall place the papers before the Chief Justice to consider whether a larger Bench should be constituted for reconsidering the question (e) the decision of a Full Bench is binding on the court including a subsequent Full Bench until it is overruled by a higher Court or a larger Bench, (f) A decision of a Full Bench can be reconsidered only by a larger Bench specially constituted by the Chief Justice for deciding the question, (g) Even the obiter dictum of a Full Bench is entitled to great weight, (h) The binding effect of a prior decision does not depend upon whether a particular argument was considered therein or not, provided that the point with reference to which an argument was subsequently advanced was actually decided (i) the decision of the Supreme.Court is binding on the High Court and the latter cannot ignore it on the ground that some relevant provisions of law were not brought to the notice of the Supreme Court or some aspects of the matter in question were not considered by the Supreme Court.
20. The law in England has been the same and is succinctly set out in Halsbury's Laws of England, Fourth Edition, Vol.26, at 296 to 302, Paragraphs 577 to 580. It is sufficient to extract the following passages found therein for the purpose of this case:
A decision of the House of Lords occasioned by members of the House being equally divided is as binding on the House and on all inferior Tribunals as if it had been unanimous. Decisions of the House of Lords are binding on every court inferior to it. It is not open to the Court of Appeal to advise judges to ignore House of Lords decisions on the ground that they were decided per incuriam or are unworkable. But if there is no discernible ratio decidendi the Court of Appeal may adopt any reasoning which appears to it correct provided it supports the actual decision of the House. (Paragraph 577) The decisions of the Court of Appeal upon questions of law must be followed by Divisional Courts and Courts of first instance, and as a general rule, are binding on the Court of Appeal until a contrary determination has been arrived at by the House of Lords. Unlike the House of Lords, the Court of Appeal does not have liberty to review its own earlier decisions. Even if a decision of the Court of Appeal has misinterpreted a previous decision of the House of Lords, the Court of Appeal must follow its previous decision and leave the House of Lords to rectify the mistake. A decision of the Court of Appeal occasioned by the members of the Court being equally divided is not binding on the court of Appeal, as there is no common law or statutory rule to oblige a court to bow to its own decisions, and a court only does so on grounds of judicial comity, which does not exist where a court is equally divided. It is undesirable that different divisions of the Court of Appeal should say different things in relation to the same matter. A full Court of Appeal has no greater powers than a division of the court and, except in the cases mentioned above, has no power to overrule a previous decision of a division of the court. Where, however, there is an apparent conflict between two previous decisions of the court, it is not uncommon for the matter to be argued before a full court as the decision of such a court carries greater weight. (Paragraph 578) A Divisional Court is bound by its own previous decisions, regardless of how many judges are sitting, with limited exceptions in criminal cases, subject always to the per incuriam rule. Faced with conflicting earlier decisions the court is free to decide which to follow. Divisional Court decisions bind judges of first instance, even of a different division, but not the Employment Appeal Tribunal. (Paragraph 579) There is no statute or common law rule by which one court is bound to abide by the decision of another court of co-ordinate jurisdiction. Where, however, a judge of first instance after consideration has come to a definite decision on a matter arising out of a complicated and difficult enactment, the opinion has been expressed that a second judge of first instance of co-ordinate jurisdiction should follow that decision; and the modern practice is that a judge of first instance as a matter of Judicial Comity usually follows the decision of another judge of first instance unless he is convinced that that judgment was wrong. Where there are conflicting decisions of courts of co-ordinate jurisdiction the later decision is to be preferred if reached after full consideration of earlier decisions. (Paragraph 580).
IV. Exceptions.
21. Halsbury's Laws of England sets out only three exceptions to the rule of precedents and the following passage is found in paragraph 578 of Vol. 26, Fourth Edition.
...Thereare, however, three and only three, exceptions to this rule; thus (1) the Court of Appeal is entitled and bound to decide which of two conflicting decisions of its own it will follow; (2) it is bound to refuse to follow a decision of its own which although not expressly overruled, cannot, in its opinion stand with a decision of the House of Lords and (3) the Court of Appeal is not bound to follow a decision of its own if given per incuriam.
In the footnote at page 299, reference is made to Young v. Bristol Aeroplane Company Ltd. (1944)2 All .E.R. 293, where the exceptions are set out. It is added there, "These are the only exceptions (1978)1 All. E.R. 1132 (H.L.). This must be taken as nullifying earlier attempts to spell out further exceptions, i.e., in Worcester Works Finance Ltd. v. Cooden Engineering Company Ltd. (1971)3 All. E.R. 708 (C.A.), (liberty to depart from earlier decision which had been disapproved by the Privy Council.)
22. In Young v. Bristol Aeroplane Company Ltd. (1944)2 All. E.R. 293, Lord Greene M.R., set out the law on the subject in unequivocal terms in the following passage:
The Court of Appeal is a creature of statute and its powers are statutory. It is one court though it usually sits in two or three divisions; each division has co-ordinante jurisdiction, but the full court has no greater powers or jurisdiction than any division of the court, Its jurisdiction is mainly appellate, but it has some original jurisdiction. To some extent its decisions are final (for example, in appeals in bankruptcy and from the country courts), But in the majority of cases there is an appeal from its decisions to the House of Lords either with the leave of the Court of Appeal or of the House of Lords. Neither in the statute itself nor (save in two cases mentioned hereafter) in decided cases is there any suggestion that the powers of the Court of Appeal sitting with six or nine or more members are greater than those which it possesses when sitting as a division with, three members. In this respect, although we are unable to agree with certain views expressed by Greer, L.N., as will presently appear, we think that he was right in saying that what can be done by a full court can equally well be done by a division of the Court. The corollary of this is, we think, clearly true, namely, that what cannot be done by a division of the Court cannot be done by the full court. In considering the question whether or not this Court is bound by its previous decisions and those of courts of co-ordinate jurisdiction, it is necessary to distinguish four classes of case. The first is that with which we are now concerned, namely, cases where this Court finds itself confronted with one or more decisions of its own or of a court of co-ordinate jurisdiction which cover the question before it, and there is no conflicting decision of this Court or of a court of co-ordinate jurisdiction. The second is where there is such a conflicting decision. The third is. where this Court comes to the conclusion that a previous decision, although not expressly overruled, cannot stand with a subsequent decision of the House of Lords. The fourth (a special case) is where this Court comes to the conclusion that a previous decision was given per incuriam. In the second and third classes of case it is beyond question that the previous decision is open to examination. In the second class, the court is unquestionably entitled to choose between the two conflicting decisions. In the third class of case the court is merely giving effect to what it considers to have been a decision of the House of Lords by which it is bound. The fourth class requires more detailed examination and we will refer to it again later in this judgment....
On a careful examination of the whole matter we have come to the clear conclusion that this Court is bound to follow previous decisions of its own as well as those of courts of co-ordinate jurisdiction. The only exceptions to this rule (two of them apparent only) are those already mentioned which for convenience we here summarise: (1) The Court is entitled and bound to decide which of two conflicting decisions of its own it will follow, (ii) The court is bound to refuse to follow a decision of its own which, though not expressly overruled, cannot in its opinion stand with a decision of the House of Lords, (iii) The court is not bound to follow a decision of its own if it is satisfied that the decision was given per incuriam.
23. The rule is that in cases not covered by the exceptions set out above, the principle of judicial precedent is in dispensable, In R v. Cunningham (1981)2 All E.R 863, Lord Hilsham of St. Marylebone L.C., had had observed,:
Under the express terms of the practice direction stare decisis is still the indispensable foundation of the use by your Lordships of the appellate jurisdiction of the House and its normal practice. Especially must this be so in criminal law, where certainty is indeed a condition of its commanding and retaining respect." Similarly in Paul Wilson and Company v. Bhoumanhal (1983)1 All E.R. 34, Lord Brandon of Oakbrook observed thus:
Guidance on the circumstances in which it would or would not be right for this House to depart from a previous decision, albeit a majority one, is to be found in the speech of Lord Wilberforce in Fitzlert Estates Ltd. v. Chary Inspector of Taxes (1977)3 All E.R. 999 : (1977)1 W.L.R. 1345 at 1349.
There is therefore, nothing left to the taxpayer but to contend, as it frankly does, that the 1966 decision Chancery Lame Safe & Deposit and Offices Company Ltd. v. I.R.C. (1966)1 All E.R. 1: 1966 A.C. 85, is wrong. This contention means, when interpreted, that three or more of Your Lordships ought to take the view which appealed then to the minority. My lords, in my firm opinion, the 1966 Practice Statement (Note (1966)3 All E.R 77) (1966)1 W.L.R. 1234, was never intended to allow and should not be considered to allow such a course. Nothing could be more undesirable, in fact, than to permit litigants, after a decision has been given by this House with all appearance of finality, to return to this House in the hope that a differently constituted committee might be persuaded to take the view which its predecessors rejected. True that the earlier decision was by a majority: I say nothing as to its correctness or as to the validity of the reasoning by which it was supported. That there were two eminently possible views is shown by the support for each by at any rate two members of the House. But doubtful issues have to be resolved and the law knows no better way of resolving them than by the considered majority opinion of the ultimate tribunal. It requires much more than doubts as to the correctness of such opinion to justify departing from it.
My lords, that guidance should, in my view, be followed and acted on in the present case. I express no opinion one way or another as to the conclusion which I might have reached if I had been a member of the committee which decided the Bremer Vulkan Schiffbau Und Maschinenfabrik v. South India Shipping Corporation (1981)1 All E.R. 289:1981 A.C. 909, case. It is sufficient to say that that decision was reached by what Lord Willberforce described as the best way of resolving doubtful issues known to the law, and that no special or unusual circumstances have been put forward as justifying a departure from it.
Dealing specifically with the four points put forward by the sellers to which I referred above, I would say this. With regard to the first point, the fact that a decision of Your Lordships' House is so unpopular with members of courts below that they are led to seek a way to get round it if they can reflect greater credit on their independence of mind that on their loyalty to the established indispensable principle of judicial precedent.
In the same, Lord Roskill observed as follows:
I have reread all the judgments and speeches in the Bremer Vulkan Schiffbau Und Maschinenfabrik v. South India Shipping Corporation (1981)1 All E.R. 289:1981 A.C 909, case. It is apparent from their perusal that there were two possible views of the correct analysis of the nature of an arbitration agreement. One commanded the greater numerical support. The other commanded the support of the majority in this House. The law of this country is determined in this way and it was the latter view which prevailed." xx xx xx In commercial law it is essential that the law should be certain. Your Lordships have recently reasserted this principle on a number of occasions, notably in cases arising from the alleged wrongful withdrawal of time chartered ships for supposedly unpunctual payment of hire. To review the Bremer Vulkan decision would create no certainty but uncertainty. Were your Lordships to yield to the sellers' submissions a few years have only to elapse and other litigants might hope to persuade a differently constituted appellate committee once again to reconsider the position and to restore the Bremer Vulkan decision to its present role.
Lord Brightman said, I turn first to the sellers' invitation that this House should depart from the conclusion which it reached less than two years ago in Bremer Vulkan Schiffbau Und Maschinenfabrik v. South India Shipping Corporation (1981)1 All E.R. 289:1981 A.C. 909. That is an invitation which I would unhesitatingly decline.
24. Courts in this country have followed the same principles and recognised the same three exceptions to the rule of precedent. Vide: 1. Jaisri Sahu v. Rajdewan Dubey and Ors. ; 2. Ramashrey Roy and Ors. v. Pashupati Kumar Pathak and Ors. ; 3. Yeshbai and Anr. v. Ganpat Irappa Jangam and Anr. ; 4. Panjumal Hasomal Advani v. Harpal Singh Abnashi Singh Sawhney and Ors. ; 5.Mamleshwar v. Kanhaiya Lal ; 6. Rama Rao and Ors. v. Shantibai and Ors. ; 7. Sitaram Hari Shankhe v. Laxman Rambodh Dubey and Anr. ; 8. Thuraka Onnuramma and Anr. v. Tahsildar, Kadiri and Ors. ; 9,Pritam Kaur v. Surjit Singh ; 10. Syed Mohideen v. Government of Tamil Nadu and Anr. ; W.A.RAntulay v. R.S.Nayak and Anr. ; 12. Municipal Corporation of Delhi v. Gurnam Kaur ; 13. Punjab Land Development and Reclaim Corporation Ltd. v. Presiding Officer, Labour Court, Chandigarh and Ors. (1990)2 L.L.J. 70; 14. Krishnakumar v. Union of India and Ors. (1990)4 S.C.C. 270; 15. State of U.P. and Anr. v. Synthetics and Chemicals Ltd and Anr. .
V. Per incuriam
25. We are here concerned with the last of the exceptions, as the question referred to us is to consider whether the judgment of the Full Bench of this Court in Tamilarasan v. Director of Hand-looms and Textiles (1981)1 L.L.J. 588, can be characterised as one per incuriam. The expression 'per incuriam' was rarely used five decades ago. When Lord Greene, M.R. set out the exceptions to the rule of precedent in Young v. Bristol Aeroplane Company Ltd. (1944)2 All E.R. 293, he took the precaution of observing that branding earlier decisions as per incuriam would be of the rarest occurrence. It is worthwhile extracting the relevant passage in his judgment, as it has been repeatedly quoted not only in England but also in this country:
It remains to consider Lancaster v. Motor Company (London) Ltd v. Bremith, Ltd. (1941)2 All E.R. 11, in which a court consisting of Sir Wilfred Greene, M.R. Clauson and Goddard, L.JJ. declined to follow an earlier decision of a court consisting of Slesser and Romer, L.JJ. This was clearly a case given per incuriam. It depended upon the true meaning (which in the late decision was regarded as clear beyond argument) of a rule of the Supreme Court to which the Court was apparently not referred and which it obviously had not in mind. The Rules of the Supreme Court have statutory force and the court is bound to give effect to them as to a statue. Where the court has construed a statute or a rule having the force of a statute, its decision stands on the same footing as any other decision on a question of law. But where the court is satisfied that an earlier decision was given in ignorance of the terms of a statute or a rule having the force of a statute the position is very different. It cannot, in our opinion, be right to say that in such a case the court is entitled to disregard the statutory provision and is bound to follow a decision of its own given when that provision was not present to its mind. Cases of this description are examples of decisions given per incuriam. We do not think that it would be right to say that there may not be other cases of decisions given per incuriam in which this Court might properly consider itself entitled not to follow an earlier decision of its own. Such cases would obviously be of the rarest occurrence and must be dealt with in accordance with their special facts. Two classes of decisions per incuriam fall outside the scope of our enquiry, namely (i) those where the court of co-ordinate jurisdiction which covers the case before it in such a case a subsequent court must decide which of the two decisions it ought to follow; and (ii) those where it has acted in ignorance of a decision of the House of Lords which covers the point in such a case a subsequent court is bound by the decision of the House of Lords.
(Underlining ours)
26. But during the last three decades, Courts have found it convenient very often to throw away earlier rulings with the label per incuriam." We notice with anguish that at times the meaning ofthe expression had not been understood properly, which has led to the misuse of the same, if not abuse. One such instance is found in Abdul Malick v. The Collector of Dharmapuri and Ors. (1968)1 M.L.J. 9, where a single Judge of this Court held that a judgment rendered at the admission stage without notice to the opposite party was per incuriam. That is obviously based on a wrong understanding of the term per incuriam.
27. The literal meaning of the expression "per incuriam "is "through want of care" (Vide: Mozley and Whitley's Law Dictionary, 7th Edition, page 255.) In Black's Law Dictionary, 5th Edition, page 1025, it has been defined as "through inadvertence". In Halsbury's Laws of England, Fourth Edition, Volume 26, page 259 - Paragraph 573, it is stated thus:
A decision is given per incuriam when the court has acted in ignorance of a previous decision of its own or of a court of co-ordinate jurisdiction which covered the case before it, in which case it must decide which case to follow; or when it has acted in ignorance of a House of Lords decision, in which case it must follow that decision; or when the decision is given in ignorance of the terms of a statute or rule having statutory force. A decision should not be treated as given per incuriam, however, simply because of a deficiency of parties, or because the court had not the benefit of the best argument, and, as a general rule, the only cases in which decisions should be held to be given per incuriam are those given in ignorance of some inconsistent statute or binding authority. Even if a decision of the Court of Appeal has misinterpreted a previous decision of the House of Lords, the Court of Appeal must follow its previous decision and leave the House of Lords to rectify the mistake.
In Morelle Ltd v. Wakeling and Anr. (1955)2 Q.B. 379, Lord Evershed M.R. observed thus:
As a general rule the only cases in which decisions should be held to have been given per incuriam are those of decisions given in ignorance or forgetfulness of some inconsistent statutory provision or of some authority binding on the court concerned; so that in such cases some part of the decision or some step in the reasoning on which it is based is found, on that account, to be demonstrably wrong. This definition is not necessarily exhaustive, but cases not strictly within it which can properly be held to have been decided per incuriam must, in our judgment, consistently with the staredecisis rule which is an essential featureof our law, be, in the language of Lord Greene, M.R., of the rarest occurrence. In the present case it is not shown that any statutory provision or binding authority was overlooked, and while not excluding the possibility that in rare and exceptional cases a decision may properly be held to have been per incuriam on other grounds, we cannot regard this as such a case. As we have already said, it is in our judgment, impossible to fasten upon any part of the decision under consideration or upon any step in the reasoning upon which the judgments were based and to say of it: "Here was a manifest slip or error". In our judgment, acceptance of the Attorney-General's argument would necessary involve the proposition that it is open to this Court to disregard an earlier decision of its own or of a court of co-ordinate jurisdiction(at least in any case of significance or complexity) whenever it is made to appear that the court had not upon the earlier occasion had the benefit of the best argument that the researches and industry of counsel could provide. Such a proposition would, as it seems to us open the way to numerous and costly attempts to re-open questions now held to be authoritatively decided. Although, as was pointed out in Young v. Bristol Aeroplane Company Ltd., 1944 K.B. 718, a "full court" of five Judges of the Court of Appeal has no greater jurisdiction or higher authority than a normal division of the court consisting of three judges, we cannot help thinking that, if the Attorney-General's argument were accepted, there would be a strong tendency in cases of public interest and importance, to invite a "full court" in effect to usurp the function of the House of Lords and to reverse a previous decision of the Court of Appeal, Such a result would plainly be inconsistent with the maintenance of the principle. In conclusion upon this point we would add that we are unable to accept Mr.Shawcross' suggestion that the decision in the first Morelle Ltd v. Wakeling and Anr. (1955)1 Q.B. 1, should be regard a & per incuriam on the ground that a necessary party to the proceedings, viz., the Crown was not before the court. A decision cannot, in our judgment, be treated as given per incuriam simply because of a deficiency of parties. We, therefore, held that the decision in the first Morelle Ltd. v. Wakeling and Anr. (1955)1 Q.B. 1, is binding upon us.
28. In Broome v. Cassell & Co. Ltd. (1971)2 All E.R. 187, Lord Denning M.R. characterised the judgment of House of Lords in Rookes v. Barnard (1964)1 All E.R. 367, as per incuriam. The matter was taken on appeal and the House of Lords in Cassell & Co. Ltd. v Broome (1972)1 All E.R. 801, disapproved of the view taken by Lord Denning M.R. in strong terms and reversed his conclusion. Lord Hailsham of St.Marylebone L.C. observed at page 809 as follows:
Moreover, it is necessary to say something of the direction to judges of first instance to ignore Rookes v. Barnard,'(1964)1 All E.R. 367, as unworkable. As will be seen when I come to examine Rookes v. Barnard (1964)1 All E.R. 367, in the latter part of this opinion, I am driven to the conclusion that when the Court of Appeal described the decision in Rookes v. Barnard (1964)1 All E.R. 367, as decided 'per incuriam' or 'unworkable' they really only meant that they did not agree with it. But, in my view, even if this were not so, it is not open to the Court of Appeal to give gratuitous advice to judges of first instance to ignore decisions of the House of Lords in this way and, if it were open to the court of Appeal to do so, it would be highly undesirable. The course taken would have put judges of first instance in an embarrassing position, as driving them to take sides in an unedifying dispute between the Court of Appeal or three members of it (for there is no guarantee that other Lords Justices would have followed them and no particular reason why they should) and the House of Lords. But, much worse than this, litigants would not have known where they stood. None could have reached finality short of the House of Lords, and, in the meantime, the task of their professional advisers of advising them either as to their rights, or as to the probable cost of obtaining or defending them, would have been quite literally, impossible. Whatever the merits, chaos would have reigned until the dispute was settled, and, in legal matters, some degree of certainty is at least as valuable a part of justice as perfection.
The fact is, and I hope it will never be necessary to say so again, that, in the hierarchical system of courts which exists in this country, it is necessary for each lower tier, including the Court of Appeal, to accept loyally the decision of the higher tiers. Where decisions manifestly conflict, the decision in Young v. Bristol Aeroplane Co. Ltd. (1944)2 All E.R. 293, offers guidance to each tier in matters affecting its own decisions. It does not entitle it to question consider decisions in the upper tiers with the same freedom. Even this House, since it has taken freedom to review its own decisions, will do so cautiously.
Lord Reid at page 835 said, It seems to me obvious that the Court of Appeal failed to understand Lord Devlin's speech, but whether they did or not I would have expected them to know that they had no power to give any such direction and to realise the impossible position in which they were seeking to put those judges in advising or directing them to disregard a decision of this House. That aberation of the Court of Appeal has made it necessary to re-examine the whole subject and incidentally has greatly increased the expense to which the parties to this case have been put.
Lord Diplock expressed himself thus:
My Lords, there is little that I should wish to add to what Lord Hailsham L.C. and Lord Reid have already said about the way the instant case was treated in the Court of Appeal. It is inevitable in a hierarchical system of courts that there are decisions of the supreme appellate tribunal which do not attract the unanimous approval of all members of the Judiciary. When I sat in the Court of Appeal I sometimes thought the House of Lords was wrong in overruling me. Even since that time there have been occasions, of which the instant appeal itself is one, when, alone or in company, I have dissented from a decision of the majority of this House. But the judicial system only works if someone is allowed to have the last word and if that last word, once spoken is loyally accepted.
The Court of Appeal (1971)2 All E.R. 187, found themselves able to disregard the decision of this House in Rookes v. Barnard (1964)1 All E.R. 367, by applying to it the label per incuriam. That label is relevant only to the right of an appellate court to decline to follow one of its own previous decisions, not to its right to disregard a decision of the Court of Appeal. Even if the jurisdiction of the Court of Appeal had been co-ordinate with the jurisdiction of this House and not inferior to it the label per incuriam would have been misused.
29. In Farrell and Anr. v. Alexander (1976)1 Q.B. 345, Lord Denning M.R., held that the case in Zimmerman v. Grossman (1972)1 Q.B. 167, was wrongly decided. But the other two learned Judges who sat with him viz., Lawton and Scarman, L. JJ. took a different view. Lawton, L.J. observed that Zimmerman v. Grosswan (1972)1 Q.B. 167, was not a case where the Court had construed a statute in ignorance of another relevant statutory provision and it was not per incuriam. He held that the judgment in the earlier case was binding on the Court. Scarman, L.J. dealt with the question more elaborately and observed as follows:
But Zimmerman v. Grosswan (1972)1 Q.B. 167, is authority binding on this Court, unless we can truly say that the judgment was per incuriam. But was it per incuriam? To say that the careful Judgment of Widgery L.J. reviewing as it did the history of the relevant legislation, was per incuriam a phrase in a foreign tongue which I translate as Homer nodded smacks of absurdity. I do not know, and would not dream of inquiring, whether Sees. 13 to 15 were present to his mind: they could not have been decisive in any event. Equally, Sections 86 to 89, whether or not he had them in mind, were relevant only as part of the context, and could not have been decisive. Can one, however, extend the per incuriam exception so as to include a case where the only indication that "Homer nodded" is that one thinks the court put upon the words of the statute a meaning which they cannot bear, and one which leads to a result that appears to be contrary to the purpose of the statute? For myself I would agree with Lord Denning M.R. that one can, in a proper case. But to do so we must be prepared to say not merely that we prefer another construction to that favoured by the court whose decision is under challenge: we must be able to demonstrate that the words of the statute are capable of only one meaning and that the meaning attributed to them by the previous decision is an impossibility. Mistake, not a difference of opinion, is the criterion. Though I doubt whether the court in Zimmerman v. Grosswan (1972)1 Q.B. 167, was under any necessity to follow Remmington v. Larchin (1921)3K.B. 404, their reasons for doing so are entitled to respect, and may well be sound. They have been wrong: but they did not fail to face the problem; and their answer, though I think another was open to them, is not to be treated as given for per incuriam.
(Underlining ours).
At the end of the judgment he observed, Nevertheless, I have immense sympathy with the approach of the Lord Denning M.R. I decline to accept his lead only because I think it damaging to the law in the long term though it would undoubtedly do justice in the present case. To some it will appear that justice is being denied by a timid, conservative, adherence to judicial precedent. They could be wrong. Consistency is necessary to certainty, one of the great objectives of law. The Court of Appeal at the very centre of our legal system is responsible for its stability, its consistency and its predictability.
30. Once again in Industrial Properties (Barton Hill) Ltd. and Ors. v. Associated Electrical Industries Ltd (Ward & Co) (Letters) Ltd. and Ors. (1977)2 All E.R. 293, Lord Denning M.R., insisted that the Court of Appeal had a right to brand a judgment of the House of Lords as per incuriam whenever there was a manifest slip or error.
31. In Paul Wilson and Company v. Bluementhal (1983)1 All E.R. 394, Lord Denning, M.R. refused to follow the decision of House of Lords in Bremer Vulcan v. South India Shipping Corporation (1981)1 All E.R. 289. That case went to the House of Lords and the judgment of the Court of Appeal was reversed. We have already extracted the relevant passages from the speeches of the Law Lords.
32. In Jaisri Sahu v. Rajdewan Dubey and Ors. , Venkatarama Aiyar, J., after setting out the law of precedents as laid down by the Privy Council in Buddah Singh v. Laltu Singh A.I.R. 1915 P.C. 70, and by the Full Bench of this Court in Seshamma v. Venkata Narasimharao (1940)1 M.L.J. 400.I.L.R. 1940 Mad. 454:51 L.W. 408.A.I.R. 1940 Mad. 356 (F.B.), and pointing out the necessity for maintaining a state of certainty in the law, observed as follows:
It sometimes happens that an earlier decision given by a Bench is not brought to the notice of a Bench hearing the same question and a contrary decision is given without reference to the earlier decision. The question has also been discussed as to the correct procedure to be followed when two such conflicting decisions are placed before a later Bench. The practice in the Patna High Court appears to be that in those cases, the earlier decision is followed and not the later. In England the practice is, as noticed in the judgment in Seshamma v. Venkata Narasimharao (1940)1 M.L.J. 400 : I.L.R. 1940 Mad. 454 : 51 L.W. 408 : A.I.R. 1940 Mad. 356 (F.B.), that the decision of a Court of Appeal is considered as a general rule to be binding on it. 'There are exceptions to it, and one of them is thus stated in Halsbury's Laws of England, third edition, Vol.22, para 1687, pp. 799-800:
The court is not bound to follow a decision of its own if given per incuriam. A decision is given per incuriam when the court has acted in ignorance of a previous decision of its own or of a court of a co-ordinate jurisdiction which covered the case before it, or when it has acted in ignorance of a decision of the House of Lords.
In the former case it must decide which decision to follow, and in the latter it is bound by the decision of the House of Lords. In Virayya v. Venkata Subbayya , it has been held by the Andhra High Court that under the circumstances aforesaid the Bench is free to adopt that view which is in accordance with justice and legal principles after taking into consideration the views expressed in the two conflicting Benches, vide also the decision of the Nagpur High Court in D.D. Bilimoria v. Central Bank of India Ltd Bombay A.I.R. 1943 Nag. 340. The better course would be noted that the great Judge having referred to the passage in Halsbury's laws of England relating to the principle often such situations arise, the Bench hearing cases would refer the matter for the decision of a Full Court.
33. It is without taking upon itself to decide whether it should follow the one Bench decision or the other. We have no doubt that where course would be for the Bench hearing the case to refer the matter to a Full Bench in view of the conflicting authorities in curiam, proceeded to hold that the best course would be to refer the matter for the decision of a Full Court. Obviously, the learned Judge did not think it fit to give liberty to the Benches to overthrow earlier judgments on the ground of per incuriam.
34. But, in Ramashrey Roy and Ors. v. Pashupati Kumar Pathak and Ors. . A Full Bench of the Patna High Court observed that the Division Bench need not have referred the matter to that Full Bench when it was found that the earlier decisions of Division Benches were not correct in view of a later decision of the Supreme Court and in view of Section 13 of the new Limitation" Act of 1963 and the Division Bench could itself have disposed of the matter on the footing that the earlier judgments were not binding on them. The Full Bench referred to the passage in Halsbury's Laws of England setting out the exceptions to the rule of precedents. On the facts of the case, the Full Bench held that Section 13 of the new Limitation Act did not apply to that case, but the two earlier decisions of the High Court should be deemed to have been overruled by a later Supreme Court decision.
35. In Yeshbhai and Anr. v. Ganpat Irappa Jangam and Anr. , a Division Bench of the Bombay High Court referred to the ruling in Young v. Bristol Aeroplane Company Ltd. (1944)2 All E.R. 293, and declared the law thus:
27. Now, a precedent is not binding if it was rendered in ignorance of a statute or a rule having the force of statute. The rule apparently applies even though the earlier court knew of the statute in question. If it did not refer to and had not present to its mind, the precise terms of the statute. Similarly, a court may know of the existence of a statute and yet not appreciate its relevance to the matter in hand; such a mistake is again such incuriam as to vitiate the decision. These are the commonest illustrations of decision being given per incuriam. In order that a case can be decided per incuriam, it is not enough that it was inadequately argued. It must have been decided in ignorance of a rule of law binding on the court, such as a statute. (See the observations in "Salmond on Jurisprudence" Twelfth Edition, pages 150 and 169).
The Bench also referred to an argument advanced before it on the principle of sub silentio and observed thus:
30. Mr. Diwan, however, is on stronger grounds in his submission that the said decisions were precedents sub silentio, since they were decided without arguments on the basis of the position in law which was assumed by the court. The circumstance in which a decision is said to be arrived at sub silentio have been described in "Salmond on Jurisprudence", Twelfth Edition. The learned author observes (at pages '153-154)-
A decision passes sub silentio, in the technical sense that has come to be attached to that phrase, when the particular point of law involved in the decision is not perceived by the court or present to its mind. The court may consciously decide in favour of one party because of point A, which it considers and pronounces upon. It may be shown, however, that logically the court should not have decided in favour of the particular party unless it also decided point B in his favour, but point B was not argued or considered by the Court. In such circumstances, although point B Was logically involved in facts and although the case had a specific outcome, the decision is not an authority on point B. Point B is said to pass sub silentio....
31. On going through the decisions (taking the view that the dispute must be "bona fide") rendered by both the single Judges as well as Division Benches of this Court, it does appear that the point was not decided on arguments. It was assumed that the word dispute in Section 12(3)(a) necessarily implies a "bona fide" or a genuine dispute. A question as to whether the word dispute should be given its plain grammatical meaning, as argued by Mr.Diwan, or whether it should be given a restricted meaning was not considered or argued in those cases. Where the case was decided on the position of law which was assumed by the court, the decision is not an authority for what was assumed. In none of the said decisions, the counsel on behalf of the tenant raised a contention on that theword dispute in Section 12(3)(a) must be given its plain grammatical meaning and the court should not restrict its plain meaning by construing the word "dispute" as a bona fide dispute". We do not find that any of the said decisions decided the point of law on argument.
Another Division Bench of the same High Court held in Penjumal Hassomal Advani v. Harpal Singh Abnashi Singh Sawhney and Ors. , that even the obite of the Supreme Court is entitled to the highest respect in the High Courts because of Article 141 of the Constitution of India. It went on to hold that normally one Division Bench of a High Court cannot take a view contrary to the decision given by another Division Bench of that court and relied on Sri Venkateswara Rice, Ginning and Groundnut Oil Mill Contractor Company v. The State of Andhra Pradesh . Then it referred to the proposition laid down by the Master of Rolls in Young v. Bristol AeroplaneCompany Ltd. (1944)1 K.B. 718. Referring to the expression per incuriam the Bench observed.
...A decision cannot be treated as given per incuriam merely because the Court had not the benefit of a full and exhaustive argument, and as a general rule the only cases in which decisions should be held to be given as per incuriam are those given in ignorance of some inconsistent statutory provision or binding authorities.
In the matter before us it cannot be said that the Division Bench in Kalavati's case C.A. No. 1699 of 1969, dt.26.4.1973 (Bom.), has given its decision either in ignorance of the provisions of any statute or binding authorities i.e. the judgment of the Supreme Court. It was, however, contended that the Division Bench in Kalavati's case C.A. No. 1699, dt.26.4.1973 (Bom.) had wrongly understood Sabharwal's Case A.I.R. 1972 S.C. 1983, and thereby erroneously came to the conclusion that the decision in Satpalsingh Arora's case (1971)73 Bom. L.R 777, which was binding, being a decision of a Division Bench, of the Bombay High Court, was no longer good law. But then, it is equally well settled that an interpretation (and equally a misinterpretation) of a binding decision of the Supreme Court will itself be binding subsequently on co-ordinate courts and must be got corrected by a higher court, and no co-ordinate Court on that ground may refuse to follow an earlier decision, opining that in its view the said earlier decision had wrongly understood or improperly applied a decision of a higher court.
36. In Mamleshwar Prasad and Anr. v. Kanhaiya Lal , the Supreme Court referred to Morelle Ltd v. Wakeling (1955)2 Q.B. 379, and declared that the per incuriam principle is of limited application and it will not be extended to cases which were merely not fully argued or which appeared to take wrong view of the authori-ties or to misinterpret a statute. The Supreme Court quoted with approval a passage from The English Legal System by R J.Walker & M..G.Walker, III Edition, Butterworths, 1972, which reads as follows:
The per incuriam principle is of limited application. Very few decisions have subsequently been regarded as having been reached per incuriam and in Morelle Ltd v. Wakeling (1955)2 Q.B. 379, a Master of the Rollsstated that such instances should be of the rarest occurrence, and should be limited to decisions given in ignorance or forgetfulness of some inconsistent statutory provision or of some authority binding on the court concerned. Thus the doctrine will not be extended to cases which were merely not fully argued or which appear to take a wrong view of the authorities or to misinterpret a'statufe.
37. In Rama Rao and Ors. v. Shantibai and Ors. , a Full Bench of that court held that an earlier decision of a single Judge was given per incuriam, as it was contrary to the view taken by that court earlier in several caes, which were not noticed by the single Judge.
38. In Sitaram Hari Shankhe v. Laxman Rambodh Dubey and Anr. , Dharmadhikari, J. held that the judgment of Joshi, J. in an earlier case was not binding on him as the specific provisions of a statute and the Rules were not noticed. The learned Judge observed that a judgment rendered in ignorance of a statute or a rule having the force of a statute was decided per incuriam. He quoted from the rulings in Yeshabiv. Ganpat Irappa Jangani and Young v. Bristol Aeroplane Company Ltd. (1944)2 All E.R. 293.
39. In Thuraka Onnuramma and Anr. v. Tahsildar, Kadiri and Ors. , a single Judge of Andhra Pradesh High Court gave a similar ruling that a decision rendered overlooking a statutory provision shall be treated as per incuriam. He has extracted a passage from "Salmond on Jurisprudence. It is worthwhile repeating the same here.
It is now well settled that a decision rendered overlooking a statutory provision shall be treated as perincuriam and cannot be regarded a binding precedent. Salmond on Jurisprudence, Twelfth Edition, page 150, says, "A precedent is not binding if it was rendered in ignorance of a statute or a rule having the force of a statute i.e., delegated legislation". Salmond cites in support of this proposition High authority of Lord Halsbury in the House of Lords in London Street Tramways v. London County Council, 1898 A.C. 375 and of Lord Greene M.R. in Court of Appeal in that well known case of Young v.Bristol Aeroplane Company Ltd (1944)1 K.B. 718. As examples of per incuriam judgments Salmond cites a case where the court knew the statute but did not refer to the precise terms of the statutes as well as to a case where the Court knew thestatute but failed to appreciate its relevance to the matter in hand. On the extensive scope of the doctrine of per incuriam Salmond says that, "Even a court can impugn a precedent on such grounds.
40. We have already referred to the judgment of Sandhawalia, C.J. in Pritam Kaur v. Surjit Singh A.I.R. 1984 P.& H. 113, and extracted the relevant passages therefrom. The learned Judge has referred in extenso to the three exceptions to the rule of precedent. It is unnecessary for us to repeat it here as it has already been quoted supra.
41. A Full Bench of this Court has in Syed Mohideen v. Government of Tamil Nadu and Anr. , relied on the principle of per incuriam and observed as follows:
23. While referring to the exception to the rule of stare decisis, it is observed in 'Precedent in England Law' by Rupert Cross, 1961 Edition, at page 130, as follows: "No doubt any court would decline to follow a case decided by itself or any other court (even one of superior jurisdiction), if the judgment erroneously assumed the existence or non-existence of a statute, and that assumption formed the basis of the decision. This exception to the rule of stare decisis is probably best regarded as an aspect of a broader qualification of the rule, namely, the courts are not bound to follow decisions reached per incuriam.
The proposition that a decision per incuriam need not be followed as a binding precedent is well established.
42. In A.R. Antulay v. R.S. Nayak and Anr. , the principle of per incuriam has been explained and applied. The relevant passage is as follows:
44. It appears that when this Court gave the aforesaid directions in 16th February, 1984, for the disposal of the case against the appellant by the High Court, the directions were given oblivious of the relevant provisions of law and the decision in Anwar Ali Sarkar 's case . See Halsbury's Laws of England, 4th Edn. Vol.26 page 297, para 578 and page 300, the relevant notes 8,11 and 15, Dias on Jurisprudence, 5th Edn. pages 128 and 130, Young v. Bristol Aeroplane Company Ltd. (1944)2 All E.R. 293 at 300. Also see the observation of Lord Goddard in Moore v. Hewitt (1947)2 All E.R. 270 at 272 and Penny v. Nicholas (1950)2 All E.R. 89, 92A. Per incuriam are those decisions given in ignorance or forget-fulness of some inconsistent statutory provision or of some authority binding on the Court concerned, so that in such cases some part of the decision or some step in the reasoning on which it is based, is found, on that account to be demonstrably wrong. See Morelle Ltd v. Wake-ling (1955)1 All E.R 708. Also see State of Orissa v. Titaghur Paper Mills Co. Ltd. . We are of the opinion that in view of the clear provisions of Section 7(2)ofthe Criminal Law Amendment Act, 1952 and Arts. 14 and 21 of the Constitution these directions were legally wrong.
43. In Municipal Corporation of Delhi v. Gurnam Kaur , the Supreme Court observed thus:
11. pronouncements of law, which are not part of the ratio decidendi are classed as obiter dicta and are not authoritative. With all respect to the learned Judge who passed the order in Jamuna Das case (W.P.Nos.981-82 of 1984) and the learned Judge who agreed with him, we cannot concede that this Court is bound to follow it. It was delivered without argument, without reference to the relevant provisions of the Act conferring express power on the Municipal Corporation to direct removal of encroachments from any public place like pavements or public streets, and without any citation of authority. Accordingly, we do not propose to uphold the decision of the High Court because, it seems to us that it is wrong in principle and cannot be justified by the terms of the relevant provisions. A decision should be treated as given per incuriam when it is given in ignorance of the terms of a statute or of a rule having the force of a statute. So far as the order shows, no argument was addressed to the court on the question whether or not any direction could properly be made compelling the Municipal Corporation to construct a stall at the pitching site of a pavement squatter. Professor P.J. Fitzgerald, Editor of Salmond on Jurisprudence, 12th edn. explains the concept of sub silentio at p.153 in these words:
A decision passes sub silentio, in the technical sense that has come to be attached to that pharse, when the particular point of law involved in the decisions is not perceived by the court or present to its mind. The court may consciously decide in favour of one party becauseof point A, which it considers and pronounces upon. It may be shown, however, that logically the court should not have decided in favour of the particular party unless it also decided point B in his favour, but point B was not argued or considered by the Court. In such circumstances, although point B was logicallyinvolved in the facts and although the case had a specific outcome, the decision is not an authority on point B. Point B is said to passs sub silentio.
12. In Gerard v. Worth of Paris Ltd. (1936)2 All E.R. 905 (C.A.), the only point argued was on the question of priority of the claimant's debt, and, on this argument being heard, the court granted the order. No consideration was given to the question whether a garnishee order could properly be made on an account standing in the name of the liquidator. When, therefore, this very point was argued in a subsequent case before the Court of Appeal in Lancaster Motor Co. (London) Ltd v. Bremith Ltd (1941)1 KB. 675, the court held itself not bound by its previous decision. Sri Wilfrid Greene, M.R. said that he could not help thinking that the point now raised had been deliberately passed sub silentio by counsel in order that the point of substance might be decided. He went on to say that the point had to be decided by the earlier court before it could make the order which it did; nevertheless, since it was decided "without argument, without reference to the crucial words,of the rule, and without any citation of authority", it was not bindingand would not be followed. Precedents sub silentio and without argument are of no moment, This rule has ever since been followed. One of the chief reasons for the doctrine of precedent is that a matter that has once been fully argued and decided should not be allowed to be reopened. The weight accorded to dicta varies with the type of dictum. Mere casual expressions carry no weight at all. Not every passing expression of a judge, however eminent, can be treated as an ex cathedra statement, having the weight of authority.
44. In Punjab Land Devt. & Reclamation Corporation Ltd. Chandigarh, etc., and several others v. Presiding Officer, Labour Court, Chandigarh etc., and several others (1990) 2L.L.J. 70, the Supreme Court considered the meaning of the expression 'per incuriam' and explained thus:
43. We now deal with the question of per incuriam by reason of allegedly not following the Constitution Bench decisions. The Latin expression per incuriam means 'through inadvertence'. A decision can be said generally to be given per incuriam when this Court has acted in ignorance of a previous decision of this Court. It cannot be doubted that Article 141 embodies, as a rule of law, the doctrine of precedents on which our judicial system is based. In Bengal Immunity Company Ltd. v. State of Bihar , it was held that the words of Article 141, "binding on courts within the territory of India" though wide enough to include the Supreme Court, do not include the Supreme Court itself, and it is not bound by its own judgment but is free to reconsider them in appropriate cases. This is necessary for proper development of law and justice.
xx xx xx ...The doctrine of ratio decidendi has also to be interpreted in the same line. In England a decision is said to be given per incuriam, when the court has acted in ignorance of a previous decision of its own or of a court of co-ordinate jurisdiction which covered the case before it, or when it has acted in ignorance of a decision of the House of Lords. In the former case it must decide which decision to follow, and in the latter it is bound by the decision of the House of Lords. It has been said that the decision of the House of Lords mentioned above, refers to a decision subsequent to that of the Court of Appeal. However, a prior decision of the House of Lords inconsistent with the decision of the Court of Appeal will make the later decision of the Court of Appeal of no value as given per incuriam. But if the prior decision had been cited to the court of Appeal and that Court had ministerpreted a previous decision of the House of Lords, the Court of Appeal must follow its previous decision and leave and House to rectify the mistake. In Halsbury's Laws of England 4th Ed. Vol. 10 para 745 it has been said:
While former decisions of the House are-nor-mally binding upon it, the House will depart from one of its own previous decisions when it appears right in the interests of justice and of the proper development of the law to do so. Cases where the House may reconsider its own previous decisions are those involving broad policy and questions of legal principle. Only in rare cases will the House reconsider questions of construction of statutes or other documents. The House is not bound to follow a previous case merely because it is indistinguishable on the facts.
The position and experience in this Court could not be much different keeping in view the need for proper development of law and justice.
45. Recently, in State of U.P. and Anr. v. Synthetics and Chemicals Ltd. and Anr. , a Bench of two Judges held that a previous decision rendered by severn Judges was per incuriam. In the earlier judgment of seven Judges, a reference was made to Entry 52 of List II in the Seventh Schedule of the Constitution of India and it was observed that the States had no power to charge sales tax on industrial alcohol. It was pointed out by the later Bench that the question which arose before the earlier Bench related only to the power of the State to levy excise duty and vend fee or transport fee by recourse to Entry 51 or Entry 8 in List II in respect of industrial alcohol and it had nothing to do with the levy of sales tax under Entry 52. It was also pointed out that Entry 52 of List II had no application to the fees or charges, the validity of which was questioned in the earlier case. Referring to that aspect of the matter, the Bench observed:
That was an abrupt observation without a preceding discussion, and inconsistent with the reasoning adopted by this Court in earlier decisions from which no dissent was expressed on the point. Coming, as it does, immediately after a reference to Entry 52 of List II in connection with excise duty and sales tax when neither falls under that entry, the submission of the Advocate General that the observation regarding sales tax in para 86 of the judgment was per incuriam assumes great significance." Again, in paragraph 36 it was observed as follows:
We are firmly of the view that the decision of this Court in Synthetics (1990)1 S.C.C. 109, is not an authority for the proposition canvassed by the assessee in challenging the provision. This Court has not, and could not have, intended to say that the Price Control Orders made by the Central Government under the I.D.R. Act imposed fetters on the legislative power of the State under Entry 54 of List II to levy taxes on the sale or purchase of goods. The reference to sales tax in paragraph 86 of that judgment was merely accidental or per incu' riam and has, therefore, no effect on the impugned levy. Again, in paragraphs 39 to 41, it was stated,
39. But the problem has arisen due to the conclusion in the case of Synthetic and Chemicals (1990)1 S.C.C. 109. The question was if the State Legislature could levy vend fee or excise duty on industrial alcohol. The Bench answered the question in the negative as industrial alcohol being unfit for human consumption the State legislation was incompetent to levy any duty of excise either under Entry 51 or Entry 8 of List II of the Seventh Schedule. While doing so a bench recorded the conclusion extracted earlier. It was not preceded by any discussion. No reason or rationale could be found in the order. This gives rise to an important question if the conclusion is law declared under Article 141 of the Constitution or it is per incuriam and is liable to be ignored.
40. Incuria literally means carelessness. In practice per incuriam appears to mean per igno-ratium. English codes have developed this principle in relaxation of the rule of stare decis. The quotable in law is avoided and ignored if it is rendered, in ignoratium of a statute or other binding authority. Young v. Bristol Aeroplane Company Ltd. (1944)1 KB. 718. Same has been accepted, approved and adopted by this Court while interpreting Article 141 of the Constitution which embodies the doctrine of precedence as a matter of law. In Jaisri Sahu v. Rajdewan Dubey , this Court while pointing out the procedure to be followed when conflicting decisions are placed before a bench extracted a passage from Halsbury's Laws of England incorporating one of the exceptions when the decision of an appellate court is not binding.
41. Does this principle extend and apply to a conclusion of law, which was neither raised nor preceded by any consideration. In other words can such conclusions be considered as declaration of law? Here again the English courts and jurists have carved out an exception to the rule of precedents. It has been explained as rule of sub silentio. A decision passes sub silentio, in the technical sense that has come to be attached to that phrase, when the particular point of law involved in the decision is not perceived by the court or present to its mind. Salmond on Jurisprudence, 12th Edn., p. 153. In Lancaster Motor Co. (London) Ltd. v. Bremith Ltd. (1941)2 All E.R 11, the court did not feel bound by earlier decision as it was rendered without any argument, without reference to the crucial words of the rule and without any citation of the authority. It was approved by this Court in Municipal Corporation of Delhi v. Gurnam Kaur . The Bench held that, precedents sub silen-tio and without arguments are of no moment. The Courts thus have taken recourse to this principle for relieving from injustice perpetrated by unjust precedents. A decision which is not express and is not founded on reasons nor it proceeds on consideration of issue cannot be deemed to be a law declared to have a binding effect as is contemplated by Article 141. Uniformity and consistency are core of Judicial discipline. But that which escapes in the Judgment without any occasion is not ratio decidendi. In B.Shama Rao v. Union Territory of Pondicherry , it was observed, it is trite to say that a decision is binding not because of this conclusions but in regard to its ratio and the principles, laid down therein.
Any declaration or conclusion arrived without application of mind or preceded without any reason cannot be deemed to be declaration of law or authority of a general nature binding as a precedent.
Restraint in dissenting or overruling is for sake of stability and uniformity but rigidity beyond reasonable limits is inimical to the growth of law.
46. An analysis of the above rulings brings out the following principles:
(1) A judgment is per incuriam if it is rendered in ignorance of a binding authority.
(2) A judgment is per incuriam if it is rendered in ignorance of a statute or a rule having the force of a statute.
(3) A judgment is not per incuriam because it is based on a wrong understanding of the law or a binding precedent and (4) Ajudgment is not per incuriam because the reasoning is wrong in the opinion of the subsequent Bench.
VI. Obiter Dicta
47. The expression obiter dictum means "that which is said in passing". In Mozley and Whiteley's 'Law Dictionary', 7th Edition, at page 240, it is defined as 'a dictum of a judge on a point not directly relevant to the case before him." If a Court expresses its opinion on a point which has not arisen for consideration in the case, it is not binding as a precedent. What is binding in a judgment is only the ratio decidendi, which means, the reason or principle on which a case is decided. An inter-estingand instructive passage is found in the judgment of a Full Bench of this Court in M.Shaikh Dawood v. Collector of Central Excise, Madras , expounding the difference between obiter dictum and ratio decidendi. It reads as follows:
It is occasionally helpful to remind oneself of basic principles and we therefore make no apology for quoting the following passages from Salmond on Jurisprudence. On pages 223 and 224 of the 11h Edn. The following passages appear;
A precedent, therefore, is a judicial decision which contains in itself, a principle. The underlying principle which thus forms its authoritative element is often termed the ratio decidendi. The concrete decision is binding between the parties to it, but it is the aibstract ratio decidendi which alone has the force of law as regards the world at large. The only use of authorities or decided cases says Sri George Jessel, "is the establishment of some principle which the Judge can follow out in deciding the case before him. The only thing says the same distinguished judge in another case, in a Judge's decision binding as an authority upon a subsequent judge is the principle upon which the case was decided." The only judicial principles which are authoritative are those which are thus relevant in their subject matter and limited in their scope. All others, at the best, are of merely persuasive efficacy. They are not true ratio decidendi and are distinguished from dicta, things said by the way. The prerogative of judges is not to make law by formulating and declaring it pertains to the Legislature but to make law by applying it. Judicial declaration, unaccompanied by j udicial application, is not of binding authority.
(14) The footnote is also of interest:
The weight to be given to obiter dicta depends upon the circumstances. Sir Carleton Allen's conclusionis that, "if the eminence of the tribunal, the consensus of judicial opinion, and the degree of deliberation all combine to lend a special weight and solemnity to dicta, then their authority is for all practical purposes indistinguishable from that of ratio decidendi." (15) In Flowerv. Ebbw Vale Steel Iron and Coal Co. (1934)2 KB. 132, the following passage appears at page 154:
It is of course perfectly familiar that obiter dicta, though they may have great weight as such, are not conclusive authority. Obiter dicta in this context mean what the words literally signify namely, statements by the way. If a Judge thinks it desirable to give his opinion on some point which is not necessary for the decision of the case, that of course has not the binding weight of the decision of the case and the reasons for the decision." We should remark in passing that this passage has been incorporated in Stroud's Judicial dictionary under the heading "Obiter Dicta".
48. In Punjab Land Devt. & Reclamation Corporation Ltd., Chandigarh etc., and several others v. Presiding Officer, Labour Court, Chandigarh etc., and several others (1990)2 L.L.J. 70, the Supreme Court analysed the principle of ratio decidendi and said thus:
47. An analysis of judicial precedent, ratio decidendi and the ambit of earlier and later decisions is be found in the House of Lords decision in F.A &A.B. Ltd. v. Lupton, (Inspector of Taxes), 1972 A.C. 634, Lord Simon concerned with the decision in Griffiths v. J.P.Harrison (Warford) Ltd., 1963 A.C. 1 and Finsbury Securities Ltd. v. Inland Revenue Commissioners (1966)1 W.L.R. 1402, with their inter-relationship and with the question whether F.A. &A.B. Ltd. v. Lupton, (Inspector of Taxes), 1972 A.C. 634, fell within the precedent established by the one or the other case, said: What constitutes binding precedent is the ratio decidendi of a case and this is almost always to be ascertained by an analysis of the material facts of the case that is, generally, those facts which the tribunal whose facts which the tribunal whose decision is in question itself holds, expressly or implicitly, to be material.
It has also been analysed:
A judicial decision will often be reached by a process of reasoining which can be reduced into a sort of complex syllogism, with the major premise consisting of a pre-existing rule of law (either statutory or judge-made) and with the minor premise consisting of the material facts of the case under immediate consideration. The conclusion is the decision of the case, which may or may not establish new law in the vast majority of cases it will be merely the application of existing law to the facts judicially ascertained. Where the decision does constitute new law, this may or may not be expressly stated as a proposition of law; frequently the new law will appear only from subsequent comparison of, on the one hand, the material facts inherent in the major premise with, on the other, the material facts which constitute the minor premise. As a result of this comparison it will often be apparent that a rule has been extended by an analogy expressed or implied.
48. To consider the ratio decidendi of a case we have, therefore, to ascertain the principle on which the case was decided. Sir George Jessel is Osborne v. Rowlett (1880)13 Ch. D. 774, remarked that the only thing in a judge's decision binding as an authority upon a subsequent judge is the principle upon which the case was decided.
49. The ratio decidendi of a decision may be narrowed or widened by the judges before whom it is cited as a precedent. In the process the ratio decidendi which the judges who decided the case would themselves have chosen may be even different from the one which has been approved by subsequent judges. This is because Judges, while deciding a case will give their own reasons but may not distinguish their remarks in a right way between what they thought to be the ratio decidendi and what were their obiter dicta,tha'cis, things said in passing having no binding force, though of some persuasive power. It is said that "a judicial decision is the abstraction of the principle from the facts and arguments of the case". Asubsequent judge may extend it to a broader principle of wider application or narrow it down for a narrower application. The submissions of Mr.Venugopal that for the purpose of ratio decidendi, the question is not whether a subsequent Bench of this Court thinks that it was necessary or unnecessary for the Constitution. Bench, or the earlier Bench to have dealt with the issue, but whether the Constitution Bench itself thought it necessary to interpret Section 2(00) for arriving at the final decision has to be held to be untenable in this wide and rigid form.
49. In Krishnakumar v. Union of India and Ors. (1990)4 S.C.C. 270, the Supreme Court observed:
19. The doctrine of precedent, that is being bound by a previous decision, is limited to the decision itself and as to what is necessarily involved in it. It does not mean that this Court is bound by the various reasons given in support of it, especially when they contain propositions wider than the case itself required. This -was what Lord Selborne said in Calendonian Railway Co. v. Walker's Trustees (1882)7 App. Cas. 259, and Lord Halsbury in Quinn v. Leathern, 1901 A.C. 495, 502. Sir Frederick Pollock has also said; Judicial authority belongs not to the exact words used in this or that judgment, nor even to all the reasons given, but only to the principles accepted and applied as necessary grounds of the decision.
20. In other words, the enunciation of the reason or principle upon which a question before a court has been decided is alone binding as a precedent. The ratio decidendi is the underlying principle, namely, the general reasons or the general grounds upon which the decision is based on the test or abstract from the specific peculiarities of the particular case which gives rise to the decision. The ratio decidendi has to be ascertained by an analysis of the facts of the case and the process of reasoning involving the major premise consisting of a pre-existing rule of law, either statutory or judge-made, and a minor premise consisting of the material facts of the case under immediate consideration. If it is not clear, it is not the duty of the court to spell it out with difficulty in order to be bound by it In the Words of Halsbury, 4th edn., Vol.26, para 573: "The concrete decision alone is binding between the parties to it but it is the abstract ratio decidendi, as ascertained on a considera tion of the judgment in relation to the subject matter of the decision, which alone has the force of law and which when it is clear it is not part of a tribunal's duty to spell out with difficulty a ratio decidendi in order to be bound by it, an it is always dangerous to take one or two observations out of a long judgment and treat them as if they gave the ratio decidendi of the case. If mere reasons-than one are given by a tribunal for its judgment, all are taken as forming the ratio decidendi.
xx xx xx
VII. Tamilarasan's Case.
50. Having reminded ourselves of the principles of law applicable, we shall now consider the question referred to us. It can be split into two parts, one relating to per incuriam and the other obiter dictum. Probably the Division Bench in Natarajan was not sure of its ground and it chose to affix two labels to Tamilarasan. The Full Bench in the earlier case was necessitated by a conflict of opinion as to whether a writ petition will lie under Article 226 of the Constitution of India against a Co-operative Society and Mohan, J. made the order of Reference. The cases posted before the Full Bench comprised of two Writ Appeals and four Writ Petitions. In one of the Writ Petitions, viz. W.P.No.6272 of 1986, the Board of Management of the Co-operative Society had been superseded and a Special Officer was managing the Society. Hence, the Full Bench had to consider, (1) whether a society managed by a Board of Directors was amenable to the jurisdiction of this Court under Article 226 of the Constitution of India and (2) whether a society managed by a Special Officer was amenable to the said jurisdiction. It can never be gainsaid that the Full Bench considered both questions and gave its opinion, though in form the question referred to it was a general one, whether a writ would lie against a Co-operative society under Article 226 of the Constitution of India? The Full Bench referred to all the judgments cited and the arguments advanced by counsel on both sides. It culled out the relevant principle mainly from the judgments of the Supreme Court in Nayagarh Co-operative Central Bank Ltd. v. Narayan Rath and S.S. Dhanoa v. Municipal Corporation Delhi . Relevant passages in those judgments were quoted by the Full Bench with emphasis supplied by itself. We will not be guilty of tautology if we extract therefrom as herein:
The Nayagarh Co-operative Central Bank Ltd. v. Narayan Rath .
The High Court has dealt with the question whether a writ petition can be maintained against a co-operative society, but are inclined to the view that the observations made by the High Court and its decision that such a writ petition is maintainable are not strictly in accordance with the decision of this Court." (Emphasis supplied). We should like to observe that the judgment of the High Court should not be treated as an authority for the proposition that a writ petition is maintainable against a co-operative society.
S.S. Dhanoa v. Municipal Corporation Delhi , Whatever has been said withregard to the Council of Scientific and Industrial Research which was a society registered under the Societies Registration Act, equally applies to the Co-operative Store Limited, which is a society registered underthe Bombay Co-operative Societies Act, 1925. It is not a statutory body because it is not created by a statute. It is a body created by an act of a group of individuals in accordance with the provisions of a statute.
(Emphasis supplied.)
51. The Full Bench went on to refer to the significance of the pronouncement of the Apex Court in S.S.Dhanoa as in that case, the service of a member of the Indian Administrative Service were placed at the disposal of a Co-operative Society and the question was whether he was a public servant within the meaning of Section 21 of the Indian Penal Code for the purposes of Section 197 of the Code of Criminal Procedure, which was answered in the negative.
52. The Full Bench made a detailed reference to the judgments of other High Courts including that of a Division Bench of the Patna High Court relating to the Bihar State Co-operative Marketing Union Limited.
53. The ratio of the Full Bench is found in paragraphs 23 and 24 of its judgment, which reads as follows:
23. The main and important factor that has to be borne in mind in dealing with the issue on hand is the fine distinction that has been pointed out by the Supreme Court on more than one occasion between a body which is created by the statute and a body which after having come into existence is governed in accordance with the provisions of the statute. In other words, a co-operative society does not owe its very existence to any statute which would be the fountain head of its power. Still further, it can be held that even if there is no statute a Co-operative society can have a legal existence. If this is the position, applying the tests laid down by the Supreme Court in the above said two cases, a co-operative society is an institution merely governed by the statutory provisions and it cannot be said to be a statutory body. In this connection, the observations of the Full Bench Judgment of the Kerala High Court, at the risk of repetition can again be extracted."
The Co-operative Societies are not created by the Co-operative Societies Act and they are not statutory bodies. They areonly functioning in accordance with the provisions of the Act. These institutions would have legal existence even if the Co-operative Societies Act was not in force. Moreover the Government have no spars in the Co-operative Societies. There is no deep and pervasive State control. The management of the societies does not vest in the Government or in the representatives of the Government Bank. The management is under the effective control of a committee elected by the members of the Societies. The statutory regulations or restriction in the functioning of the Societies is not an imprint of State under Article 12". Hence no writ will lie against a Co-operative Society governed by the Kerala Co-operative Societies Act.
24. The issue can be looked from another angle. The Supreme Court in Co-operative Central Bank Ltd. v. Additional Industrial Tribunal, Andhra Pradesh, Hyderabad A.I.R. 1970 S.C. 245, has held that the Bye-laws of a cooperative society framed in pursuance of the provisions of the Act cannot be held to the law or to have the force of law. This also supports the view that a co-operative society is not a statutory functionary. The fact that whenever the governing body is superseded and in its place a Special Officer or other Government official is appointed to administer the affairs of the society makes any difference has to be considered now. We are of the view that having regard to the decision of the Supreme Court in S.S.Dhanoa v. Municipal Corporation Delhi , the position is that it does not make any difference. Any officer appointed in the place of the governing body stepping into the shoes of the governing body and discharging the functions as such definitely not is a Government servant. In the case referred to above the Supreme Court has clearly held that when the services of an Indian Administrative Officer are placed at the disposal of a co-operative society, he was not discharging the functions as a public servant.
Significantly, the Full Bench extracted the same passage in S.S.Dhanoa v. Municipal Corporation Delhi , for a second time in paragraph 24 and observed that the said passage placed beyond doubt that a Co-operative Society was not a statutory body. In fine, the Full Bench concluded that a Co-operative Society is not an authority or instrumentality or agency of the Government to attract Article 12 of the Constitution of India and, therefore, not amendable to Writ jurisdiction under Article 226 of the Constitution of India.
54. It was argued before us that the judgment of the Full Bench is per incuriam as it has not expressly referred to the provisions of the Tamil Nadu Co-operative Societies (Appointment of Special Officers) Act, 1976 (Act XXV of 1976), whereunder the Boards of Management of Co-operative Societies were superceded and Special Officers were appointed by the Government to manage the societies. The argument is fallacious. In paragraph 11 of its judgment, the Full Bench referred expressly to the reliance placed by one of the Counsel on the provisions of Tamil Nadu Act XXV of 1976, in particular the preamble to the Act and Sections 3 and 4 thereof. That argument was rejected by the Full Bench in paragraph 24 of its judgment, which we have extracted above. The said Act has substitu ted only the Board of Management by the Special Officer and has not changed the character or status of a Co-operative Society. Thus, the question has been specifically considered and decided. The fact that the sections of the Act are not extracted and that they have not been referred to in paragraph 24 or any other part of the judgment, would not mean that the Full Bench acted in ignorance of the provisions of the said Act or forgot about the same.
55. It is now contended that the facts in Dhanoa's case A.I.R. 1981 S.C. 1395, were distinguishable and the judgment of the Supreme Court was wrongly understood and invoked by the Full Bench. According to learned Counsel, in Dhanoa's case A.I.R. 1981 S.C. 1395, (the Board of Management was not superseded as such, but a member of the Indian Administrative Service was appointed as General Manager of the Co-operative Society in question, which fact would, accordingly to learned Counsel, make all the difference and that such a society whose Board of Management was a superseded by Tamil Nadu Act XXV of 1976. A careful perusal of the judgment in Dhanoa's case , does not warrant such distinction. The basic principle on which S.S.Dhanoa was decided was that a Co-operative Society was not a statutory body as it was not created by a statute. The change in the management of the society by supersession of the entire Board of Management, statutorily or otherwise, or placing the management in the hands of a Government servant without superseding the Board of Management would not make any difference in the eye of law in view of the basic principles that a society is not a statutory body as it is not a creature of a statute. We do not find any error in the reasoning of the Full Bench in Tamilarasan v. Director of Handlooms and Textiles (1981)1 L.L.J. 588. Even assuming for the sake of argument without admitting, that the reliance placed by the Full Bench on S.S.Dhanoa was erroneous, it would not make the judgment per incuriam. It would at worst be only an erroneous understanding of the judgment of the Supreme Court by the Full Bench. That will not certainly render it per incuriam.
56. It is next argued that the judgment of the Full Bench is not invalidated by the sub silentio rule enunciated by the Supreme Court in Municipal Corporation of Delhi v. Gurnam Kaur , and State of U.P. and Anr. v. Synthetics and Chemicals Ltd. and Anr. . There is no substance in the argument. The Full Bench has expressly referred to the argument based on the provisions of Tamil Nadu Act XXV of 1976 and given its ruing in paragraph 24 of its judgment by relying on Dhanoa's case . The rule of sub silentio is nowhere.
57. What is stated above is sufficient to reject the contention that the judgment of the Full Bench in Tamilarasan v. Director of Handlooms and Textiles (1989)1 L.L.J. 588, is per incuriam. No argument or separate reasoning is needed to say that the decision of the Full Bench is not obiter dicta. We have already referred to the fact that it was necessary for the Full Bench to decide the question whether a society managed by a Special Officer was amenable to the jurisdiction under Article 226 of the Constitution of India. We are in-clined to characterise the contention that the judgment of the Full Bench is obiter dicta as unintelligible.
VIII. Judgment of the Division Bench in A.Natarajan v. Registrar of Co-operative Societies, Chepauk and Ors. (1991)2L.W. 420: (1989)2L.L.J. 296.
58. The judgment of the Division Bench in A. Natarajan v. Registrar of Co-operative Societies, Chepauk and Ors. (1991)2 L.W. 420: (1989)2 L.L.J. 296, is the immediate cause for this reference. Finding that the ruling in Tamilarasan v. Director of Handlooms and Textiles (1981)1 L.L.J. 588, would bind them and prevent them from passing an order to their liking, the Division Bench chose the extraordinary course of characterising the Full Bench as per incuriam and obiter dicta. One of the reasons given by the Division Bench for labelling the Full Bench as per incuriam is so indefensible that learned Counsel for the petitioner could not say a word in support of it. That reason is, the Full Bench had not taken notice of the statement of law as found in the case of Brij Bihari Singh's case (1989)37 (2) B.L.J.R. 219. That was a judgment of a Division Bench of the Patna High Court, to which the Senior Judge in the Division Bench of this Court was a party when he was a Judge of that Court. Unfortunately, the learned Judge in his anxiety to get over the binding authority of the Full Bench, failed to note that the judgment of the Patna High Court was delivered on a later date and the Full Bench of this Court could not have had an inkling that a Division Bench of the Patna High Court would later take a different view on the question which was being decided by them. The judgment in Tamilarasan v. Director of Handlooms and Textiles (1991)2 L.W. 409 : (1981)1 L.L.J. 588 (F.B.), was delivered on 29.3.1989 by the Full Bench while Brij Bihari Singh's case (1989)37 (2) B.L.J.R. 219, was decided on 18.4.1989, i.e., 19 days after the judgment of the Full Bench. Even if the Division Bench judgment of Patna High Court had been earlier, it was certainly not binding on the Full Bench of this Court and the latter was entitled to ignore it. Naturally, there is no attempt on the part of counsel for the petitioner to support that part of the reasoning of the Division Bench. The Division Bench has also observed that the Patna Judgment in Brij Bihari Singh's case (1989) 37 (2) B.L.J.R. 219, has been affirmed by the Supreme Court in the sense that after notice in the special leave petition, the petition for special leave was dismissed. A thorough search in the judgment of the Division Bench for the reasoning of the Supreme Court in the special leave petition, which is said to have been dismissed, is in vain. There is no reference whatever to any part of the judgment of the Supreme Court in the said special leave petition. The judgment does not seem to have been reported anywhere. It is not known how the Division Bench came to possess the knowledge of the order of the Supreme Court in the special leave petition. Nothing appears on record that the same emanated from the Bar. It is elementary principle that the dismissal of a special leave petition by the Supreme Court by a non-speaking order will be ineffective as an authority or binding precedent. Such dismissal without indicating the grounds or reasons therefor, must, by necessary implication, be taken to be that the Supreme Court had decided only that the case was not fit for grant of special leave. Vide Workmen of Cochin Port Trust v. Board of Trustees of the Cochin Port Trust , Indian Oil Corporation Ltd. v. State of Bihar and Ors. and Supreme Employees Welfare Association v. Union of India and Ors. . In the last of the case referred to above, the Supreme Court has observed that dismissal of a special leave petition simplicitor without any reason, will not be a declaration of law by the Supreme Court under Article 14 of the Constitution of India. It is very strange that the Division Bench should refer to the dismissal of the special leave petition by the Supreme Court in the case of Brij Bihari Singh without making any reference to the ratio thereof.
59. The Division Bench has taken the view that the provision of the Tamil Nadu Act XXV of 1976 were not noticed by the Full Bench in Tamilarasan v. Director of Handlooms and Textiles (1991)2 L.W. 409: (1981) 1 L.L.J. 588 (F.B.). We have already adverted to the relevant facts and pointed out that the Full Bench was fully aware of the provisions of the Act and has given its ruling in the view that they did not make any difference in the basic position that a society is not the creature of a statute. It should be noted that the judgment of the Division Bench suffers from a fundamental fallacy in that it equates the supersession of the board of Management of a society to the supersession of the society itself. In paragraph 25, a reference is made to S.S. Dhanoa's case , and it is observed that it was not a case of a society which had been superseded by the State Government. It is seen that in the judgment in Brij Bihari Singh's case (1989)37 (2) B.L.J.R. 219, the Division Bench of the Patna High Court proceeded on the footing that the relevant Bihar Act had superseded the societies themselves. It is also noted that the management of the society had been vested in the Government under the Bihar Act and administrators were appointed pursuant thereto. But, under the Tamil Nadu Act XXV of 1976, the management of the society has not vested in the Government. We have already noted that the said Act has substituted only the Board of Management by the Special Officer and has not changed the character or status of a co-operative society. Section 5 of the Act keeps in tact the applicability of the provisions of the Co-operative Societies Act and the Rules made thereunder to a Special Officer except as otherwise provided in Section 4 thereof. Under Section 4, the Special Officer shall have the same power to exercise all or any of the functions of the Management Committee or Board of Management of the Society. His remuneration is made payable from the funds of the society and not from Government funds. A comparison of the provisions of Tamil Nadu Act (XXV of 1976) with those of the Bihar Act as found in the judgment in Brij Bihari Singh's case (1989)37 B.L.J.R. 219, shows that the two Acts are entirely different and they are not pari materia. The Division Bench is, therefore in error in holding that the reasoning in Brij Bihari Singh's case (1989)37 (2) B.L.J.R. 219, would hold good with reference to Tamil Nadu Act XXV of 1976 and that the Full Bench is per incuriam inasmuch as it has not adopted that reasoning.
60. It goes without saying that the Division Bench has exceeded its bounds in characterising the judgment of the Full Bench as per incuriam. The other reason given by the Division Bench for not following the Full Bench is that the latter is obiter dicta. It is unnecessary for us to repeat what we have stated earlier to reject that reason given by the Division Bench as unsustainable.
61. The Division Bench could well have taken the royal road of making a Reference to a larger Bench if it was not able to agree with the Full Bench. It is a matter for regret that the Division Bench should erroneously brand a binding authority as per incuriam and obiter dicta, thereby paving way to judicial anarchy, which would only throw the litigants into chaos and confusion.
62. Before concluding, we shall place on record that it was brought to our notice that the Supreme Court has granted Special Leave against the judgment of the Division Bench in A. Natarajan v. Registrar of Co-operative Societies, Chepauk and Ors. (1991)2L.W. 420: (1989)2 L.L.J. 296. It was also pointed out by learned Counsel or the third respondent that he is challenging the maintainability of the writ petition in thiscase on the ground that an efficacious alternative remedy is available to the petitioner and instead of availing the same, he should not have approached this Court. As the reference made to us is of a limited scope in view of the specific question framed, we decided to proceed further and express our opinion. We have considered it unnecessary to decide the question of maintainability of the writ petition on the ground of availability of an efficacious alternative remedy.
63. We have no hesitation in answering the question referred to us in the negative and holding that the judgment of the Full Bench in Tamilarasan v. Director of Handlooms and Textiles (1991)2 L.W. 409 : (1981)1 L.L.J. 588 (F.B.), is not per incuriam or obiter dicta and the views taken by the Division Bench in A. Natarajan v. Registrar of Co-operative Societies and Ors. (1991)2 L.W. 420 : (1989) 2 L.L.J. 296. is not correct. We hold that the judgment of the Full Bench is a valid precedent binding on the Division Benches and single Judges of this Court as well as subordinate courts.