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2025 (1) TMI 1622
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....ring for the appellant. The respondents are represented by Ms. Mrinal Gopal Elker, learned counsel and Mr. Avdhesh Kumar Singh, learned counsel. 2. This matter is posted before this larger Bench on account of the split verdict rendered on 4.4.2024 by the two learned Judges of this Court. The case pertains to the validity of appointments made for the post of school teachers (Shiksha Karmi Grade III) in Janpad Panchayat, Gaurihar in the year 1998. Four Civil Appeals were filed before this Court by ten persons, who are alleged to be the relatives of the members of the selection committee and were placed in the final select list of 249 Shiksha Karmis. 3. While Justice JK Maheshwari upheld the finding to set aside the selection of Shiksha Karmis on account of the violation of the first limb of the principle of natural justice i.e. rule against bias, Justice KV Vishwanathan has however upheld the selection, citing inter alia, a breach of the right to a fair hearing. Therefore, in this case, we are confronted with a conflict between the two foundational principles of natural justice i.e. rule against bias (nemo judex in causa sua) and the right to a fair hearing (audi alteram partem....
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....rding them any hearing, the Collector could not have interfered with the selection and this would be in violation of the principles of natural justice. The Revision Petition was however dismissed by the Commissioner vide order dated 14.3.2000. In the said order the Commissioner observed in para (6) that the selection is contrary to Section 40(C) of the Adhiniyam, 1993. The Revisional Authority brushed aside the plea of non-joinder and of not affording opportunity of hearing, by relying on the admission of the relationship of the appellants with the members of the selection committee, as noted in the reply filed by the Chief Executive Officer. Aggrieved by the order of the Commissioner, the appointees filed a writ petition under Article 226 of the Constitution of India before the Madhya Pradesh High Court which was however dismissed by the learned single judge vide order dated 31.7.2008. Relying on State Bank of Patiala v SK Sharma 1996 (3) SCC 364, it was observed that the opportunity of hearing has to be tested on the touchstone of actual prejudice being caused to the writ petitioners. It was also noted that full opportunity of hearing was granted at the Revisional stage by the Co....
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....was further held that the principle must be adhered to at the original stage. Furthermore, Rule 9 of the Appeal and Revision Rules, 1995 was not complied with. It was also observed that the orders of the Collector & Commissioner made no reference either to definition of 'relative' in explanation to Section 40(c) of Adhiniyam nor to the resolution providing for recusal. Non-impleadment of parties amounted to 'no opportunity at all' for hearing was the conclusion reached by Justice KV Vishwanathan. 10. On the other hand, Justice J.K. Maheshwari upheld the decision to cancel the appointment of the appellants and opined that the first limb of natural justice i.e. 'rule against bias' was irrefutably proved, as reasonable likelihood of bias was established. The plea of non-impleadment was considered to be a useless formality. It was further held that unless prejudice is demonstrated, mere non-joinder at the initial stage does not violate the principles of natural justice. II. SUBMISSIONS 11. The foundational contention of the appellants is that since their appointments were cancelled without affording them any hearing and without arraying them as a party in the challenge by the ....
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....edural irregularity State of A.P. v. McDowell & Company, (1996) 3 SCC 709; Tata Cellular v. Union of India, (1994) 6 SCC 651; and Council of Civil Service Unions v. Minister for Civil Service, 1985 AC 374 (HL); Mohd. Mustafa v. Union of India, (2022) 1 SCC 294. Lord Diplock Council of Civil Service Unions v. Minister for Civil Service, 1985 AC 374 succinctly described each of the aforementioned grounds for judicial review as under: "By "illegality" as a ground for judicial review I mean that the decision-maker must understand correctly the law that regulates his decision-making power and must give effect to it. Whether he has or not is par excellence a justiciable question to be decided, in the event of dispute, by those persons, the Judges, by whom the judicial power of the State is exercisable. By "irrationality" I mean what can by now be succinctly referred to as "Wednesbury [Associated Provincial Picture Houses v. Wednesbury Corpn., (1948) 1 KB 223 (CA)] unreasonableness". It applies to a decision which is so outrageous in its defiance of logic or of accepted moral standards that no sensible person who had applied his mind to the question to be decided could h....
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....C 463 : 1997 SCC (L&S) 1806. 16. In this case, our primary focus is on procedural impropriety and in particular, the breach of the principles of natural justice. The process for arriving at a decision is equally significant as the decision itself. If the procedure is not 'fair', the decision cannot be possibly endorsed. The principles of natural justice as derived from common law which guarantee 'fair play in action' Maneka Gandhi v. Union of India, (1978) 1 SCC 248, has two facets which include rule against bias and the rule of fair hearing. Additionally, a reasoned order has also been regarded as a third facet of the principles of natural justice S.N. Mukherjee v. Union of India, (1990) 4 SCC 594 ; Siemens Engg. & Mfg. Co. of India Ltd. v. Union of India, (1976) 2 SCC 981; CCI v. SAIL, (2010) 10 SCC 744; Kranti Associates (P) Ltd. v. Masood Ahmed Khan, (2010) 9 SCC 496 and holds utmost significance in ensuring fairness of the process. ISSUE A 17. The first issue that falls for our consideration is whether the selection stands vitiated on the ground of violation of the rule against bias. It must be borne in mind that when a statute specifies the procedure for admini....
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....at will be given preference. (ii) Select list of each category shall be prepared on the basis of above assessment in order of merit and shall include 10% names in waiting list which shall be valid for six months." 20. The statutory Rules clearly specify the designation of those who must be included in the selection committee, as outlined in Schedule II of the Rules, 1997. They are following: "1. Chairperson, Standing Committee of Education of Janpad Panchayat; 2. Chief Executive Officer, Janpad Panchayat; 3. Block Education Officer (Member Secretary); 4. Two specialists in the subject to be nominated by the Standing Committee for Education of whom one shall be woman; and 5. All members from the Standing Committee of whom at least one belongs to Scheduled Castes, Scheduled Tribes or OBC, in case there is no SC/ST/OBC member in the Standing Committee then the same shall be nominated from the General Body." 21. Therefore, 'all members from the Standing Committee' were required to be a part of the selection committee. It is also important to note that the following resolution was passed by the Standing Committee on recusal: ....
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....ing out any type of lease, getting any work done through them in the Panchayat by an office-bearer of Panchayat. Explanation. - For the purpose of this clause, the expression "relative" shall mean father, mother, brother, sister, husband, wife, son, daughter, mother-in-law, father-in-law, brother -in-law, sister-in-law, son-in-law or daughter-in-law : ]" 23. The explanation to clause(c) provides for the definition of the expression 'relative' to mean 'father, mother, brother, sister, husband, wife, son, daughter, mother-in-law, father-in-law, brother-in-law, sister-in-law, son-in-law or daughter-in-law'. Rule 100 of the Adhiniyam which has some relevance reads thus: "100. Penalty for acquisition by a member, office bearer or servant of interest in contract. - If a member or office bearer or servant of Panchayat knowingly acquires, directly or indirectly any personal share or interest in any contract or employment, with, by or on behalf of a Panchayat without the sanction of or permission of the prescribed authority he shall be deemed to have committed an offense under Section 168 of the Penal Code, 1860 (XLV of 1860)." 24. Having noted the relevant statutory....
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...., it must then ask whether those circumstances would lead to a fair minded and informed observer to conclude that there was a real possibility that the Tribunal was biased." 27. Indian Courts have consistently adopted the 'real likelihood' test to determine bias Manak Lal v Dr. Prem Chand Singhvi 1957 SCC OnLine SC 10; Ranjit Thakur v. Union of India (1987) 4 SCC 611; Rattan Lal Sharma v. Managing Committee, Dr. Hari Ram (Co-Education) Higher Secondary School, (1993) 4 SCC 10; S Parthasarathi v. State of AP (1974) 3 SCC 459; SK Golap and others v Bhuban Chandra Panda 1990 SCC OnLine Cal 264; GN Nayak v Goa University (2002) 2 SCC 712. In a recent decision in Central Organisation for Railway Electrification v. ECI SPIC SMO MCML (JV) A Joint Venture Co. 2024 SCC OnLine SC 3219, a constitution bench of this Court speaking through DY Chandrachud CJ(of which one of us was a member), summarised the Indian position thus: "Although there have been vacillations about the test in England, the Indian courts have been largely consistent in their approach by applying the test of real likelihood of bias or reasonable apprehension of bias. Recently, the court has used the real danger ....
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.... cannot reasonably be inferred. While it is true that actual bias need not be proved, this appears to be a case of allegation of bias without any foundational footing. We must also be mindful of the fact that the absence of opportunity of hearing at the initial stage, has prevented the selectee to show that no relative had influenced their selection. It also disables this Court to examine the issue holistically to conclusively determine bias. 30. It must also be emphasized that the nemo judex rule is subject to the rule of necessity and yields to it Union of India v Tulsiram Patel, (1985) 3 SCC 398; Swadesh Cotton Mills v Union of India, (1981) 1 SCC 664. In J Mohapatra v State of Orissa (1984) 4 SCC 103, the Court recognized that the doctrine of necessity serves as an exception to the rule against bias. In a matter like this, the doctrine of necessity would also be squarely attracted since the statute explicitly mandates the composition of the selection Committee, as outlined in Schedule II of the Rules. The doctrine of necessity recognizes that decision-making bodies need to function even in circumstances where potential conflicts of interests may arise. Here as earlier noted,....
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.... (supra) as under: "Great reliance was placed by the learned counsel on A.K. Kraipak & Ors. V. Union of India on the question of natural justice. We do not think that the case is of any assistance to the petitioners. It was a case where one of the persons, who sat as member of the Selection Board, was himself one of the persons to be considered for selection. He participated in the deliberations of the Selection Board when the clams of his rivals were considered. He participated in the decisions relating to the orders of preference and seniority. He participated at every stage in the deliberations of the Selection Board and at every stage there was a conflict between his interest and duty. The court had no hesitation coming to the conclusion that there was a reasonable likelihood of ibis and therefore, there was a violation of the principles of natural justice. In the case before us, the Principal of the Medical College, Srinagar, dissociated himself from the written test and did not participate in the proceedings when his daughter was interviewed. When the other candidates were interviewed, he did not know the marks obtained either by his daughter or by any of the candida....
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....w and is often referred to as a magna carta of natural justice. This decision has resonated deeply in the Indian legal context where natural justice principles are firmly entrenched with constitutional guarantees. 37. In Mohinder Singh Gill v. Chief Election Commr (1978) 1 SCC 405 (for short 'Mohinder Gill'), this Court observed that: "Today in our jurisprudence, the advances made by natural justice far exceed old frontiers and if judicial creativity belights penumbral areas, it is only improving the quality of government by injecting fair play into its wheels.. law lives not in a world of abstractions but in a cosmos of concreteness and to give up something good must be limited to extreme cases. If to condemn unheard is wrong, it is wrong except where it is overborne by social necessity." 38. In Swadeshi Cotton Mills v. Union of India (1981) 1 SCC 664, this Court held: "this rule of fair play must not be jettisoned save in very exceptional circumstances where compulsive necessity so demands. The Court must make every effort to salvage this cardinal rule to the maximum extent possible, with situational modifications." 39. Justice Bhagwati in Maneka Gandhi....
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....ossible, and under the law, only one penalty is permissible, then the Court may not compel the observance of natural justice' Swadeshi Cotton Mills v Union of India (1981) 1 SCC 664; Aligarh Muslim University v Mansoor Ali Khan (200) 7 SCC 529. 43. Professor IP Massey I.P. Massey, Administrative Law (8th Edition,2012) has commented on this shift as under: "Before the decision of the Highest Court in SL Kapoor v Jagmohan, the rule was that the principles of natural justice shall apply only when the an administrative action has caused some prejudice to the person, meaning thereby that he must have suffered some 'civil consequences'. Therefore, the person had to show something extra in order to prove 'prejudice' or civil consequences. This approach had stultified the growth of administrative law within an area of highly practical significance. It is gratifying that in Jagmohan, the Court took a bold step in holding that a separate showing of prejudice is not necessary. The non-observance of natural justice is in itself prejudice caused. However, merely because facts are admitted or are undisputable it does not follow that the principles of natural justice need not be obser....
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....di alteram partem rule cannot by itself, without more, lead to the conclusion that prejudice is thereby caused. (2) Where procedural and/or substantive provisions of law embody the principles of natural justice, their infraction per se does not lead to invalidity of the orders passed. Here again, prejudice must be caused to the litigant, except in the case of a mandatory provision of law which is conceived not only in individual interest, but also in public interest. (3) No prejudice is caused to the person complaining of the breach of natural justice where such person does not dispute the case against him or it. This can happen by reason of estoppel, acquiescence, waiver and by way of non-challenge or non-denial or admission of facts, in cases in which the Court finds on facts that no real prejudice can therefore be said to have been caused to the person complaining of the breach of natural justice. (4) In cases where facts can be stated to be admitted or indisputable, and only one conclusion is possible, the Court does not pass futile orders of setting aside or remand when there is, in fact, no prejudice caused. This conclusion must be drawn by the Cour....
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....t of audi alteram partem encompasses the components of notice, contents of the notice, reports of inquiry, and materials that are available for perusal. While situational modifications are permissible, the rules of natural justice cannot be modified to suit the needs of the situation to such an extent that the core of the principle is abrogated because it is the core that infuses procedural reasonableness. The burden is on the applicant to prove that the procedure that was followed (or not followed) by the adjudicating authority, in effect, infringes upon the core of the right to a fair and reasonable hearing. [See para 12 of Bhagwati, J.'s judgment in Maneka Gandhi v. Union of India, (1978) 1 SCC 248.]" 48. Pertinently on the issue, a five judge bench of this Court in CORE(supra) described the object of observing the principles of natural justice as under: "80. ...The object of observing the principles of natural justice is to ensure that "every person whose rights are going to be affected by the proposed action gets a fair hearing." The non-observance of natural justice is itself a prejudice to any person who has been denied justice depending upon the facts and ci....
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.... out their version and thereafter hold such enquiry as the Collector may deem necessary. This was also not done. This is all the more when only the appointment of the 14 candidates of the 249 appointees/candidates were set aside on the ground that 33 they were relatives and it was not a case of setting aside of the entire selection. It is well settled that in service matters when an unsuccessful candidate challenges the selection process, in a case like the present where the specific grievance was against 14 candidates under the category of relatives and when the overall figure was only 249, at least the candidates against whom specific allegations were made and who were identified ought to have been given notices and made a party. This Court has, even in cases where the selected candidates were too large, unlike in the present case, held that even while adjudicating the writ petitions at least some of the selected candidates ought to be impleaded even it is in a representative capacity. It has also been held that in service jurisprudence, if an unsuccessful candidate challenges the selection process the selected candidates ought to be impleaded. [See J.S. Yadav vs. State ....
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....pportunity of hearing: "40. Removal of office-bearers of Panchayat- (1) The State Government or the prescribed authority may after such enquiry as it may deem fit to make at any time, remove an office-bearer- (a) if he has been guilty of misconduct in the discharge of his duties; or (b) if his continuance in office is undesirable in the interest of the public: Provided that no person shall be removed unless he has been given an opportunity to show cause why he should not be removed from his office." [emphasis supplied] 54. In the absence of notice, the breach strikes at the fundamental core of procedural fairness, rendering the decision invalid unless exceptional circumstances justify such deviation. The vitiation of selection was not only a breach of the principles of natural justice but also contrary to the express statutory provision that required for an opportunity to show cause and an opportunity to provide self-defence. The prejudice theory must be understood as an exception to the general rule and cannot therefore be the norm. In view of the foregoing, a gross violation of the principle of audi alteram partem is noticed in the ....
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....as held that the proper course in such a situation would be to hear the matter afresh: "If one accepts the contention that a defect of natural justice in the trial body can be cured by the presence of natural justice in the appellate body, this has the result of depriving the member of his right of appeal from the expelling body. If the rules and the law combine to give the member the right to a fair trial and the right of appeal, why should he be told that he ought to be satisfied with an unjust trial and a fair appeal? Even if the appeal is treated as a hearing de novo, the member is being stripped of his right to appeal to another body from the effective decision to expel him. I cannot think that natural justice is satisfied by a process whereby an unfair trial, though not resulting in a valid expulsion, will nevertheless have the effect of depriving the member of a right of appeal when a valid decision to expel him is subsequently made. Such a deprivation is a powerful result to be achieved by what in law is a mere nullity; and it is no mere triviality that might be justified on the ground that natural justice does not mean perfect justice. As a general rule, at ....
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....ring: instead of fair trial followed by appeal., the procedure is reduced to an unfair trial followed by fair trial" 62. Professor Laurence Tribe Lawrence H. Tribe, 'American Constitutional Law' ((The Foundation Press 1978) had pertinently observed that whatever the outcome, a valued human interaction in which the affected person experiences atleast the satisfaction of participating in the decision that vitally concerns her is of utmost importance: "Both from the right to be heard and the right to be told why, are analytically distinct from the right to secre a different outcome; these rights to interchange express the elementary idea that to be a person, rather than a thing, is at atleast to be consulted about what is done with one." 63. In Institute of Chartered Accountants v. L. K. Ratna (1986) 4 SCC 537, the Indian Supreme Court endorsed the position adopted by Megarry J. Rejecting the argument that an appeal to the High Court under Section 22A of the Chartered Accountants Act, 1949, could rectify the initial defect, Pathak J. declared the order null, void, and of no effect. This ruling was consistent with two earlier Supreme Court decisions in State of U.P. v. M....