P. N. BHAGWATI, N. K. VAKIL, J. ( 1 ) THESE two appeals raise questions of considerable importance and complexity having impact alike in the field of administrative law as in the field of civil law. They arise out of proceedings in winding up of a company called Rajratna Naranbhai Mills Limited (hereinafter referred to as the Company ). The Company owned a textile mill in Petlad a town situate in Kaira District and by an order made by a Single Judge of this Court on 26th June 1967 the Company was ordered to be wound up by the Court on the ground that it was unable to pay its debts. On the making of the winding up order; the Official Liquidator attached to this Court took charge of the assets of the Company and commenced the winding up proceedings. The Official Liquidator after obtaining the sanction of the Company Judge disposed of some of the stocks and stores of the Company which were likely to deteriorate in value with the passage of time but he was obstructed in giving delivery of the goods by the workers who insisted that he should proceed to sell the textile mill so that it might be started by the purchaser and the workers might get employment. The Official Liquidator therefore made a report to the Company Judge on 5th March 1968 for directions in regard to the sale of the textile mill comprising land buildings plant etc. It may be mentioned at this stage that prior to the making of this report for directions on 26th December 1967 the Directors of the Company had made out and submitted to the Official Liquidator a statement as to the affairs of the Company as required by sec. 454 of the Companies Act 1956 and this statement showed the estimated value of the assets of the Company to be in the neighbourhood of rupees sixty-six lacs. 454 of the Companies Act 1956 and this statement showed the estimated value of the assets of the Company to be in the neighbourhood of rupees sixty-six lacs. The Official Liquidator in the report made by him pointed out this fact to the Company Judge and sought the directions of the Company Judge as to whether he should obtain valuation report in regard to the textile mill before issuing advertisements for sale of the textile mill or he should issue such advertisements without obtaining the valuation report and in the absence of the valuation report fix any offset price and whether he should demand any earnest money by way of deposit along with the application for offer On the report the necessary directions were given by the Company Judge on the same day namely 5 March 1968. The Company Judge directed that advertisements for sale of the textile mill should be given in two Gujarati newspapers namely Sandesh and Gujarat Samachar and two English newspapers namely Times of India Bombay Edition and Times of India Ahmedabad Edition without obtaining any valuation report no offset price need be fixed before issuing such advertisements and rupees twenty-five thousand should be demanded as earnest money by way of deposit along with the application for offer. Pursuant to these directions of the Company Judge the Official Liquidator issued advertisements in Times of India Bombay and Ahmedabad Editions and Sandesh and Gujarat Samachar inviting offers for purchase of the textile mill belonging to the Company 6 for running the mill. It was stated in the advertisements that the offers should be accompanied by earnest money of rupees twenty-five thousand and that the sale would be on as is and where is basis and would be subject to sanction of this Honble High Court and upon additional payment of 10% of the value offered within a week from the date of such intimation by the Official Liquidator. Six offers were received by the Official Liquidator in response to the advertisements but out of them three were not accompanied by the earnest money of rupees twenty-five thousand and they were therefore not eligible to be considered according to the directions given by the Company Judge. These three offers which were not accompanied by the earnest money of rupees twenty-five thousand were as under:- (1) Shri Purshottamdas H. Choksi Rs. 10 0 0 (2) Shri Dhaneshkumar Rameshchandra Rs. These three offers which were not accompanied by the earnest money of rupees twenty-five thousand were as under:- (1) Shri Purshottamdas H. Choksi Rs. 10 0 0 (2) Shri Dhaneshkumar Rameshchandra Rs. 9 25 0 (3) Shri Ishwarbhai R. Patel. Rs. 1 25 0the remaining three offers which were accompanied with the earnest money of rupees twenty-five thousand and which were therefore in order were from:- (1) Shri Vrajeshkumar A. Parekh for Rs. 11 12 111 (2) Shri Vitthalbhai P. Patel the second respondent for Rs. 12 50 0 (3) Shri Ambubhai K. Patel for Rs. 12 0 1 it may be pointed out that Shri Vrajeshkumar A. Parekh who made an offer of Rs. 11 12 111 was one of the Directors of the Company at the date when it was ordered to be wound up by the Court and he along with other Directors was a signatory to the Statement of Affairs filed under sec. 454 of the Act. On receipt of these offers the Official Liquidator made a report to Divan J. on 24th April 1968 placing these offers before the learned Judge and seeking his further directions on the points specified in the report. On the report the learned Judge made an order dated 25th April 1968 that it was not necessary to obtain any valuation report nor was it necessary to sell the textile mill of the Company by public auction and that the Official Liquidator should write to the second respondent the highest offered that his offer would be accepted provided he deposits ten per cent of the purchase price with the Official Liquidator within one week from the date of intimation from the Official Liquidator. Pursuant to these directions given by the learned Judge the Official Liquidator wrote to the second respondent stating that his offer would be accepted if he deposited ten per cent of the purchase price and calling upon him to pay the same within one week from the date of receipt of the letter. The second respondent accordingly deposited with the Official Liquidator a sum of Rs. The second respondent accordingly deposited with the Official Liquidator a sum of Rs. 1 25 0 by a demand draft forwarded along with his letter dated 30th April 1968 and on receipt of the amount of deposit the Official Liquidator addressed a letter dated 3rd May 1968 to the second respondent intimating to him that his offer for purchase of the textile mill of the Company was accepted. All that remained to be done thereafter was for the Official Liquidator to obtain confirmation of this sale in favour of the second respondent ( 2 ) BUT before the Official Liquidator could take any steps for the purpose of obtaining such confirmation one Manharlal Shah a creditor of the Company who had supported the appellant in the winding up petition preferred an appeal being Original Jurisdiction Appeal No. 2 of 1968 against the order of Divan J. dated 25th April 1968 sanctioning the sale in favour of the second respondent. The appeal was preferred on 3 May 1968 and immediately on the filing of the appeal interim order was obtained staying the operation of the order impugned in the appeal. The appeal was however dismissed by a Division Bench of this Court on 25 April 1968 on the ground that the appeal was not maintainable at the instance of Manharlal Shah since he was not a party to the proceeding in which the impugned order was passed by Divan J. Manharlal Shah thereupon applied for and obtained leave to appeal to the Supreme Court but subsequently he decided not to proceed further and the leave was therefore revoked. ( 3 ) SOMETIME thereafter on 7th October 1968 the appellant in these appeals took out a Judges summons being Company Application No. 76 of 1968 praying that the orders dated 5th March 1968 and 25th April 1968 passed by Divan J. and the proceeding taken by the Official Liquidator pursuant to those orders be set aside since those orders were passed by the learned Judge without issuing notice to the appellant and giving him an opportunity to be heard and they were therefore null and void. This summons was however subsequently by an order dated 12th December 1968 made by Divan J. allowed to be withdrawn by the appellant with liberty to adopt fresh proceedings if so advised in respect of the same subject matter and without prejudice to the rights and contention of the parties. ( 4 ) THE appellant did not thereafter adopt any fresh proceedings for setting aside the orders dated 5th March 1968 and 25th April 1968 but in the meantime the Official Liquidator took out a summons for directions in Company Application No. 3 of 1969 on 17th January 1969. By this summons for directions which we shall hereafter refer to as the first summons the Official Liquidator sought sanction of the Court in regard to the exercise of the power to sell the movable and immovable properties of the Company. Now obviously this summons was futile since the Official Liquidator had already agreed to sell the textile mill comprising all the assets of the Company to the second respondent after obtaining the directions of the Court and no other property of the Company remained to be sold but the summons was taken out by him ex abundanti cautela in view of a judgment given by a Division Bench of this Court in the meantime in a matter arising in the winding up of a company called Anant Mills Ltd. This Judgment to which we shall refer in some detail a little later decided that whenever the Official Liquidator wants to exercise the power to sell any property of the company under sec. 457 sub-sec. (1) clause (c) it is obligatory upon him to comply with the procedure set out in rule 139 and to take out a summons for directions as contemplated by that rule so that notice of the summons would go to the petitioning creditor and the petitioning creditor would have an opportunity of being heard before the Court gives directions in regard to the exercise of the power of sale and that the directions given by the Company Judge in that case on the report of the Official Liquidator without complying with the procedure set out in rule 139 were therefore liable to be set aside. The Official Liquidator probably felt in view of this judgment that the defect in the procedure followed by him in the present case should be remedied and therefore with a view to regularising the steps he had already taken he took out the first summons for directions. The appellant supported the prayer in the first summons for directions on the ground that the orders dated 5th March 1968 and 25th April 1968 were null and void since they had been passed by Divan J. without complying with the procedure set out in rule 139 and in any event in breach of the principles of natural justice and the entire proceedings being thus vitiated it was necessary to issue fresh directions to the Official Liquidator with regard to the sale of the properties of the Company. The second respondent was also joined as a party respondent to this summons for directions and his stand was that the entire assets of the Company having already been agreed to be sold to him by the Official Liquidator with the sanction of the Court nothing further remained to be done and the first summons for directions was therefore misconceived. ( 5 ) THE first summons for directions came up for hearing before D. A. Desai J. and at the hearing it was felt that the appropriate stage at which the objections against the validity of the sale in favour of the second respondent could be properly considered would be when the Official Liquidator moved the Court for confirmation of the sale under rule 272 of the Companies (Court) Rules 1959 and the first summons for directions was therefore adjourned in order to enable the Official Liquidator to take out a summons for directions for confirmation of the sale. The Official Liquidator accordingly took out another summons for directions in Company Application No. 23 of 1969 on 1st February 1969 for confirmation of the sale in favour of the second respondent. This summons for directions which we shall hereafter refer as the second summons was also addressed to the appellant and the second respondent. The appellant opposed the summons for directions while the second respondent supported it. This summons for directions which we shall hereafter refer as the second summons was also addressed to the appellant and the second respondent. The appellant opposed the summons for directions while the second respondent supported it. These two summons for directions were heard together by D. A. Desai J. and by an order dated 12/13th March 1969 the learned Judge rejected the contentions of the appellant and upheld the proposed sale in favour of the second respondent. The learned Judge held following the judgment of the Division Bench in Anant Mills case that the Official Liquidator had failed to comply with the mandatory provision of rule 139 which required that if the Official Liquidator wants to exercise his power to sell any property of the company under sec. 457 sub-sec (1) clause (c) he must take out a summons for directions with notice to the petitioning creditor. But observed the learned Judge this non-compliance did not have the effect of rendering the orders dated 5th March 1968 and 25th April 1968 void ab initio:- these orders were merely voidable at the discretion of the Court in properly constituted proceedings adopted by the appellant and since no proper proceedings had been adopted by the appellant to annul or set aside these orders they stood valid and could not be ignored by the Court as nullity in subsequent proceedings adopted by the Official Liquidator:- the learned Judge observed that these orders being judicial orders made by a single Judge of this Court they could not be disregarded unless they were set aside by adopting appropriate proceedings such as appeal or review and since no such proceedings were adopted by the appellant it was not competent to him to disregard these orders. The learned Judge then proceeded to consider whether the proposed sale in favour of the second respondent should be confirmed and after considering various relevant facts and circumstances bearing upon this question the learned Judge came to the conclusion that the price at which the textile mill of the Company was proposed to be sold to the second respondent was neither improper nor unduly low and there was no reason why the proposed sale should not be confirmed. The learned Judge in this view of the matter rejected the first summons for directions and granted the second by confirming the proposed sale in favour of the second respondent. The learned Judge in this view of the matter rejected the first summons for directions and granted the second by confirming the proposed sale in favour of the second respondent. The appellant thereupon preferred two appeals one in each summons for directions. ( 6 ) THE principal contention urged on behalf of the appellant in support of the appeals was that on a proper construction rule 139 required that if the Official Liquidator wants to sell any property of the company in liquidation in exercise of the power under sec. 457 sub-sec. (1) clause (c) he must take out a summons for directions and notice of the summons must be given to the petitioner on whose petition the winding up order is made and since this procedure was not followed in the present case and the mandatory requirement of rule 139 was infringed the orders dated 5th March 1968 and 25th April 1968 passed by Divan J. and all subsequent proceedings pursuant to those orders were null and void and the proposed sale in favour of the second respondent was not liable to be confirmed as claimed in the second summons for directions and fresh directions in regard to the sale of the textile mill of the Company were necessary to be given as prayed for in the first summons for directions. This contention was disputed on behalf of the second respondent on several grounds. The second respondent in the first place submitted that rule 139 had no application when the Official Liquidator wanted to exercise his power to sell any property of the company under sec. 457 sub-sec. (1) clause (c):- it did not oblige him to follow the procedure therein set out:- he could obtain necessary directions on a report without taking out a summons for directions. If contrary to this submission rule 139 was held applicable then said the second respondent it was directory and not mandatory and breach of it did not have any invalidating consequence. The second respondent also urged that if rule 139 was so construed as suggested by the appellant it went beyond sec. 643 which conferred rule making power on the Supreme Court and was therefore without authority and void. The second respondent also urged that if rule 139 was so construed as suggested by the appellant it went beyond sec. 643 which conferred rule making power on the Supreme Court and was therefore without authority and void. Even if rule 139 was held to be valid and obligatory in its mandate contended the second respondent a disregard of that rule did not have the effect of rendering the orders of Divan J. null and void:- it merely made them voidable in an appropriate proceeding and since no appropriate proceeding by way of appeal or review was taken by the appellant to have these orders quashed and set aside they stood valid and could not be ignored by D. A. Desai J. in disposing of the two summons for directions before him. It was also urged on behalf of the second respondent that in any event even if the orders of Divan J. were a nullity they were judicial orders of a superior Court and therefore unless they were set aside by adopting appropriate proceedings such as appeal or review they could not be ignored by the Court as nullity in subsequent proceedings and D. A. Desai J. was right in proceeding on the basis that they were valid and effective. The second respondent also urged in the last alternative that in any view of the matter the appellant had waived by each of the mandatory requirement of rule 139 and the orders of Divan J. were therefore not null and void and in any event the appellant was precluded from contending that they were so; ( 7 ) ON these rival contentions the first question which arises for consideration is as to whether rule 139 has any application when the Official Liquidator wants to exercise his power to sell any property of the company under sec. 457 sub-sec. (1) clause (c ). Is he obliged then to take out a summons for directions with notice to the petitioning creditor on pain of invalidity of the proceedings taken by him or is it competent to him to obtain directions of the Court on a report ? 457 sub-sec. (1) clause (c ). Is he obliged then to take out a summons for directions with notice to the petitioning creditor on pain of invalidity of the proceedings taken by him or is it competent to him to obtain directions of the Court on a report ? The learned Advocate General appearing on behalf of the second respondent contended that rule 139 is not applicable in such a case and it is not necessary for the Official Liquidator to take out a summons for directions under this rule if he wants to sell any property of the company in exercise of his power under sec. 457 sub-sec. (1) clause (c ). He pointed out that the occasion to exercise the power of sale may arise at any point of time in winding up proceedings and if rule 139 were construed to mean that whenever the Official Liquidator wants to sell any property of the company he must come under rule 139 that would make nonsense of the provision in the opening part of the rule which says that a summons for directions shall be taken out by the Official Liquidator as soon as practicable after the winding up order is made and in any event not later than seven days after filing his preliminary report under sub-sec. (1) of sec. 455. How can this prescription of the opening part of the rule fit in where the Official Liquidator proposes to sell any property of the company say three or four years after the winding up order is made? As a matter of fact in a majority of cases no question of selling any property of the company would arise until after various stages in the winding up have been taken by the Official Liquidator and that might take quite a long time. In such cases it would be impossible to comply with the requirement as to time set out in the opening part of rule 139. The learned Advocate General pointed out that the summons for directions contemplated in rule 139 is a summons which is required to be taken out by the Official Liquidator without unreasonable delay in order that the Court should have complete seizing of the winding up proceeding and the programme of winding up may be chalked out a the earliest so as to expedite the winding up proceedings and avoid unnecessary delay. This summons for directions contended the learned Advocate General is akin to a summons for directions which is required to be taken out in suits in City Civil Courts in order Ho fix in advance the various steps in the proceeding in the suit. Rule 139 said the learned Advocate General does not contemplate summonses for directions to be taken out from time to time in the course of winding up whenever the Official Liquidator wants to exercise any of his powers under sec. 457 sub-sec. (1) or requires directions of the Court on any matter arising in the winding up. This contention urged by the learned Advocate General on behalf of the second respondent might have required serious consideration by us if the construction of the rule were res integra but as held by D. A. Desai J. this contention is already concluded adversely to the second respondent by the decision of the Division Bench in Anant Mills case and it would therefore be futile on our part to examine its validity. What happened in Anant Mills case was that after the Anant Mills Ltd. was ordered to be wound up by the Court the Official Liquidator made a report dated 5th March 1968 to Divan J. seeking the same directions as in the present case. In fact the report was a common report in regard to both the companies and the order made by Divan J. on 5th March 1968 was also a common order applicable to both the companies. The same procedure was followed by the Official Liquidator as he did in the present case and Divan J. by an order dated 6th June 1968 made on the report submitted by the Official Liquidator directed him to accept the offer made by one Raojibhai Patel. The petitioning creditor thereupon preferred an appeal against the order dated 6th June 1968 after obtaining leave of the Court and this appeal came up for hearing before a Division Bench consisting of Bakshi and D. A. Desai JJ. The main contention in support of the appeal was that no directions could be given by the Court in regard to the exercise by the Liquidator of his power to sell any property of the company under sec. 457 sub-sec. The main contention in support of the appeal was that no directions could be given by the Court in regard to the exercise by the Liquidator of his power to sell any property of the company under sec. 457 sub-sec. (1) clause (c) unless a summons for directions was taken out by him and notice of the summons was given to the petitioning creditor as required by rule 139 and that the order dated 6th June 1968 not being in compliance with the mandatory requirement of rule 139 was therefore invalid. This contention was upheld by the Division Bench and the order dated 6th June 1968 was set aside. Bakshi J. speaking on behalf of the Division Bench said:-ON a plain reading of the rule its effect is that when any of the three matters mentioned above is to be considered and orders are to be taken in regard to it a summons for directions and a notice to the petitioning creditor are essential. The rule specifically refers to the taking out of a summons and the issuance of a notice and the words upon the hearing in the rule make it amply clear that such orders are intended to be passed after a hearing. The matters included within the scope of the rule are such that while passing orders in regard to them rights or interests of persons concerned and other similar questions of importance might have to be considered and it would be in consonance with the principles of justice that persons whose interests are likely to be affected should be heard before any orders were passed on matters in which they are likely to be concerned. In cases for example where it is proposed to grant permission to sell the property of the company several questions might arise which the Court might be required to consider whether the property should be sold wholly or in part whether the property should be leased out or used or dealt with in any other manner whether the sanction to sell should be general or restrictive. On all these and several other questions including the value the price of the assets it would be necessary for the Court to apply its mind. The exercise of powers mentioned in sub-sec. (1) of sec. On all these and several other questions including the value the price of the assets it would be necessary for the Court to apply its mind. The exercise of powers mentioned in sub-sec. (1) of sec. 457 by the Liquidator would be such a matter and in such cases it has been thought proper to make a specific rule to take out summons for directions and to issues notice to the petitioning creditors so that a hearing to the persons concerned may be given before the Court considers and applies its mind on the questions before it and the parties may be enabled to place their point of view before the Court. . . . When the Liquidator asks for permission to sell. . . . In such a case. . . . the provisions of rule 139 would be attracted and it would be necessary to take out summons for directions and to issue a notice to the petitioning creditor. . . . . Now rule 139 makes no exception and any matter which would be within its ambit would be governed by that rule and it would then be necessary to follow the procedure prescribed therein. When directions for the use of power of the Liquidator are to be obtained from the Court that is the rule which would apply and when directions relating to permission to sell are sought rule 139 would come into operation. . . . We are therefore of the view that when the Liquidator filed his report on 5th March 1968 seeking directions from the Court the provisions of rule 139 were attracted and it was necessary that a summons for directions was taken out and a notice was issued to the petitioning creditor. These observations apply wholly and completely in the present case and it must therefore be held that rule 139 was applicable and the Official Liquidator making a report to the Court for directions in regard to the exercise of the power to sell the textile mill of the Company under sec. 457 sub-sec. (1) clause (c) ought to have taken out a summons for directions and notice of the summons ought to have gone to the appellant as required by rule 139. These observations also conclude the contention of the second respondent that rule 139 is directory and not mandatory. 457 sub-sec. (1) clause (c) ought to have taken out a summons for directions and notice of the summons ought to have gone to the appellant as required by rule 139. These observations also conclude the contention of the second respondent that rule 139 is directory and not mandatory. Bakshi J. has emphasized at several places that the taking out of a summons for directions and giving notice of it to the petitioning creditor are essential which is the same thing as saying that they are mandatory. As a matter of fact if rule 139 were directory and not mandatory it is difficult to see how the Division Bench could have come to the conclusion that breach of it had the effect of invalidating the order dated 6th June 1968. We must therefore reject the contention of the learned Advocate General that rule 139 had no application when the Official Liquidator sought directions of the Court in regard to the sale of the textile mill of the Company and that in any event the provision enacted in it was directory and not mandatory. ( 8 ) THAT takes us to the next question whether rule 139 is outside the scope of the rule-making power conferred on the Supreme Court under sec. 643. That section provides:-643 (1) The Supreme Court after consulting the High Courts (a) shall make rules providing for all matters relating to the winding up of companies which by this Act are to be prescribed; and may make rules providing for all such matters as may be prescribed. . . . . (b) may make rules consistent with the Code of Civil Procedure 1908 (i) as to the mode of proceedings to be had for winding up of a company in High Courts and in Courts subordinate thereto;. . . . . . . . . . . . . . . . . . . . . . . . Clause (a) of sub-sec. (1) of sec. 643 confers power on the Supreme Court to make rules providing for all matters relating to winding up of companies which by the Act are to be prescribed. . . . . . . . . . . . . . . . . . . . . . . . Clause (a) of sub-sec. (1) of sec. 643 confers power on the Supreme Court to make rules providing for all matters relating to winding up of companies which by the Act are to be prescribed. Now rule 139 as interpreted by the Division Bench in Anant Mills case prescribes the manner in which the Official Liquidator should obtain directions of the Court with regard inter alia to the exercise of the power to sell the assets of the company under sec. 457 sub-sec. (1) clause (c ). The question is whether this rule can be said to be a rule providing for any matter relating to the winding up of companies which by the Act is to be prescribed. The sale of the assets of the company is certainly a matter relating to the winding up of the company and rule 139 is therefore a rule providing for a matter relating to the winding up of companies. But as the plain language of the section shows that is not enough. The matter must be one in relation to which rules are required to be prescribed by the Act. We must therefore turn to inquire whether there is any provision in the Act which prescribes making or rules in regard to sale of the assets of the company. The learned Advocate General contended that there is no such provision in the Act and he relied on the absence of any such provision in sec. 457 sub-sec. (1) and sec. 458 which are the sections providing for the exercise of the power to sell the assets of the company. But the search for such a provision cannot be limited to sec. 457 (1) and sec. 458. Sec. 460 sub-sec. (4) clearly enacts such a provision. It says that the Liquidator may apply to the Court in the manner prescribed if any for directions in relation to any particular matter arising in the winding up. But the search for such a provision cannot be limited to sec. 457 (1) and sec. 458. Sec. 460 sub-sec. (4) clearly enacts such a provision. It says that the Liquidator may apply to the Court in the manner prescribed if any for directions in relation to any particular matter arising in the winding up. The manner in which an application may be made by the Official Liquidator for directions in relation to the exercise of the power to sell the assets of the company is a matter which by this provision is to be prescribed and rule 139 is therefore clearly a rule providing for a matter relating to the winding up of companies which by the Act is required to be prescribed within the meaning of sec. 643 sub-sec. (1) clause (a ). Rule 139 as interpreted in Anant Mills case must therefore be held to be within the scope of the rule-making power of the Supreme Court under sec. 643 and the challenge to its validity must fail. ( 9 ) WE now pass on to consider the next question as to what is the effect of breach of the mandatory requirement of rule 139. Does it render the decision given in breach of it void or voidable ? Now in order to answer this question. it is necessary first to appreciate the distinction between void and voidable. As pointed out by Sir Fredrick Pollock in his Law of Contracts the words void and voidable are imprecise and apt to mislead and it is therefore all the more necessary that we should clear the ground by pointing out what exactly is the sense in which these words are used when we speak of a void decision or a voidable decision. There are two points of distinction between void and voidable acts. Firstly an act which is void is of no force and effect ab initio:- it never had any binding force. On the other hand an act which is voidable is valid and remains valid until the Court takes some action to avoid it:- it is voidable at the discretion of the Court so that the Court is not bound to quash it:- the Court has discretion to uphold or condemn the act and it may quash the act only if justice so requires:- where the Court question it its action is not declaratory but constitutive. Secondly the distinction between void and voidable acts depends on the method by which it is challenged. A voidable act can be invalidated only in certain kinds of proceedings:- these proceedings are especially formulated for the purpose of directly challenging such acts. Appellate proceedings constitute the classic instance of such a method of review. In such proceedings the disputed decision may be set aside or modified without affecting its essential validity prior to the appeal. Following American nomenclature these proceedings may be termed direct proceedings. On the other hand when an act is not merely voidable but void it is a nullity and can be disregarded and impeached in any proceedings before any Court or tribunal and whenever it is relied upon. In other words it is subject to collateral attack. Vide Benjafiold and Whitmore on Principles of Australian Administrative Law. With these prefatory remarks we shall now proceed to examine whether breach of the mandatory provision of rule 139 rendered the orders of Divan J. void or voidable. ( 10 ) NOW reading sec. 457 sub-sec. (1) clause (c) and rule 139 as interpreted by the Division Bench in Anant Mills case together it is clear that the Official Liquidator cannot take any steps for sale of the property of the company without obtaining the directions of the Court a view which also finds support from sec. 457 sub-sec. (3) which prescribes that the exercise by the Liquidator in a winding up by the Court of the powers conferred by sec. 457 sub-secs. (1) and (2) shall be subject to the control of the Court and the Court has no power to give such directions unless the Official Liquidator takes out a summons for directions notice of the summons is given to the petitioning creditor and if the petitioning creditor appears he is heard on the summons. The giving of notice of an summons for directions to the petitioning creditor and affording him an opportunity to be heard are matters of substance and not mere matters of form:- as we shall presently point out they constitute essentials of justice. Compliance with these requirements of rule 139 is a condition of exercise of the power to give directions in regard to sale of the property of the company by the Official Liquidator. Compliance with these requirements of rule 139 is a condition of exercise of the power to give directions in regard to sale of the property of the company by the Official Liquidator. If the condition is not satisfied the Court cannot exercise the power or in other words the Court would lack power and the purported exercise of the power would be no exercise at all:- it would be void and of no effect. This would appear to be the plain inevitable effect of the language used in rule 139 and no authority is needed to support it but we find that there are at least two decisions of high authority where identical approach has been adopted in construing similar statutory enactments. ( 11 ) THE first decision to which we may refer in this connection is the decision of the Privy Council in Raghunath Das v. Sundar Das 41 I. A. 251. In this case the judgment-debtor became insolvent pending attachment but no notice was given to the Official Assignee as required by Order 21 rule 22 of the Code of Civil Procedure and the property was sold in execution of the decree and the question was whether such a sale was a nullity. Now the jurisdiction or power to execute a decree is conferred on the Court which passed the decree by sec. 38 of the Code but Order 21 rule 22 prescribes that in cases falling within that rule the Court shall issue a notice to the person against whom execution is applied for calling upon him to show cause why the decree should not be executed against him. The Judicial Committee of the Privy Council held that the omission to give notice as required by Order 21 rule 22 rendered the sale absolutely void for want of jurisdiction or power and it was not a mere irregularity rendering the sale voidable. Referring to an earlier decision of the Calcutta High Court in Gopal Chunder Chatterjee v. Gunamoni Dasi (1892) I. L. R. 20 Cal. 370 the Judicial Committee said:-AS laid down in Copal Chunder Chatterjee v. Gunamoni Dasi a notice under sec. 248 of the Code (the present Order 21 rule 22) is necessary in order that the Court should obtain jurisdiction to sell property by way of execution as against the legal representative of a deceased judgment debtor. 370 the Judicial Committee said:-AS laid down in Copal Chunder Chatterjee v. Gunamoni Dasi a notice under sec. 248 of the Code (the present Order 21 rule 22) is necessary in order that the Court should obtain jurisdiction to sell property by way of execution as against the legal representative of a deceased judgment debtor. (Underlining is ours) this statement from the opinion of the Judicial Committee clearly shows that without service of notice under Order 21 rule 22 the Court would have no jurisdiction or power to sell the property of the judgment debtor in execution of the decree and the sale would be a nullity. The analogy of this decision applies wholly in the present case. There is no difference in substance between sec. 38 and Order 21 rule 22 of the Code and sec. 457 sub-sec. (1) clause (c) and rule 139 so far as the present question is concerned. ( 12 ) THE decision of the House of Lords in Ridge v. Baldwin (1964) A. C. 40 also supports the construction we are placing on rule 139. In that case the chief constable of Brighton was dismissed by the Watch Committee without complying with Regulation 1 of S. I. 1952 No. 1706 and the question was whether the dismissal was void or voidable. Sec. 191 sub-sec. (4) of the Municipal Corporation Act 1882 conferred power on the Watch Committee to dismiss any borough constable whom they think negligent in the discharge of his duties or otherwise unfit for the same. Regulation 1 of S. I. 1952 No. 1706 provided that if there is a report or allegation from which it appears that a chief constable may have committed an offence against the Discipline Code then the police authority must unless they are satisfied that he has not committed an offence inform him in writing of the report or allegation and ask him whether or not he admits that he has committed an offence and give him an opportunity if he so desires of making to the police authority any oral or written statement he may wish to make concerning the matter. Regulation 2 of S. I. 1952 No. 1706 as applied to chief constables by Regulation 18 carved out an exception from this rule and said that if the chief constable admits that he has committed an offence; the police authority may impose a punishment in accordance with regulation 11 of these regulations without the case being heard in accordance with the following provisions of these regulations. On a plain construction of these provisions Lord Morris of Borth-y-Gest observed:-THE power to dismiss for an offence was a power that could only be exercised if the procedure of the regulations was set in motion. A purported dismissal in complete disregard of them cannot be recognised as having any validity. AND concluded the discussion of this point by saying:- my Lords if the regulations were applicable in this case as in my judgment they were regulation 2 of S. I. 1952 No. 1706 to which I have referred above only gives a power to impose punishment without a hearing if a condition is satisfied namely if there is an admission of the commission of an offence. In the present case there was no such admission and the watch committee therefore lacked power to impose punishment for an offence without a hearing; in purporting to dismiss the appellant they acted without jurisdiction and their decision was a nullity. The power to dismiss was conferred on the Watch Committee by sec. 191 (4) of the Municipal Corporations Act 1882 There was a condition introduced by the Regulations which trenched on that power and qualified it so that on a combined reading the power to dismiss for an offence could be exercised by the Watch Committee only after a hearing and the Watch Committee had no power to impose punishment of dismissal for an offence without a hearing. This view taken by Lord Morris of Borth-y-Gest was shared by Lord Reid who observed:-THE other ground on which some of Your Lordships prefer to proceed is the respondents failure to act in accordance with the Police Regulations. I have had an opportunity of reading the speech about to be delivered by my noble and learned friend Lord Morris of Borth-y-Gest and I agree with his views about this. So also Lord Hodson expressed his agreement with the judgment of Lord Morris of Borth-y-Gest on this point. I have had an opportunity of reading the speech about to be delivered by my noble and learned friend Lord Morris of Borth-y-Gest and I agree with his views about this. So also Lord Hodson expressed his agreement with the judgment of Lord Morris of Borth-y-Gest on this point. This decision clearly supports the conclusion that the power to give directions under sec. 457 sub-sec. (1) and (3) could be exercised by the Court only after notice of the summons for directions to the petitioning creditor and after hearing him if he chose to appear on the summons and the Court lacked the power to give directions without complying with this procedure. The orders dated 5th March 1968 and 25th April 1968 passed by Divan J. in disregard of the mandatory requirement of rule 139 cannot therefore be recognized as having any validity and must be held to be nullity. ( 13 ) THIS question may also be looked at from a slightly different angle. It is a basic principle of natural justice enshrined in the Latin maxim audi alteram partem taken from the tag which Coke first quoted from Senecas media:- Boswells case that no order shall be passed to the prejudice of any person unless he has been given a fair and reasonable opportunity to make any relevant statement which he might desire to bring forward and to correct or controvert any relevant statement prejudicial to his view. It is a rule of fundamental importance basic to our system of administration of justice and hallowed and sanctified by three centuries of judicial decisions in England. As far back as 1723 holding the deprivation of Dr. Bentley of his degrees without notice to be illegal and invalid Fortescue J. proclaimed the rule in words which have become memorable; Besides the objection for want of notice can never be got over The Jaws of God and man both give the party an opportunity to make his defence if he has any. Willes J. in Cooper v. Wandsworth Board of Works (1863) 14 C. B. N. S. 180 described the rule as one of universal application and founded upon the plainest principles of justice. Willes J. in Cooper v. Wandsworth Board of Works (1863) 14 C. B. N. S. 180 described the rule as one of universal application and founded upon the plainest principles of justice. So also in Ridge v. Baldwin (supra) Lord Morris of Borth-y-Gest said of the rule:- My Lords here is something which is basic to our system:- the importance of upholding it far transcends the significance of any particular case. It is this rule which is embodied and incorporated in rule 139. Vide also the observations of Bakshi J. quoted above. The same consequence must therefore attach to a breach of rule 139 as would attach to a breach of audi alteram partem rule. That raises the question:- what is the effect of breach of audi alteram partem rule Does it render the decision void or voidable ? ( 14 ) NOW as pointed out by Lord Reid in Ridge v. Baldwin (supra) this point has been decided time and again and the consistent view taken by the Courts in England and India has always been that a decision given in breach of audi alteram partem rule is null and void and not voidable at the discretion of the Court. There are numerous decisions on the point but we will refer only to a few which directly illustrate the point we are making. One of the earliest cases in England in which this question came up for consideration was Bonaker v. Evans 83 Revised Reports 409 The Consistory Court issued sequestration without notice to the vicar why it should not issue. The sequestration having taken the profits an action of debt for money had and received was brought against him by the vicar. The action was held by the Queens Bench to be well-founded on the ground that the sequestration was made in breach of audi alteram partem rule and was therefore void. The Court said:- But then when the order was issued and disobeyed he should not have proceeded to punish the disobedience by sequestration without giving the plaintiff a fair opportunity of being heard:- and the omission to do so in our opinion renders the subsequent sequestration void. On the ground then that this sequestration was void for the reasons given before we think that the plaintiff was entitled to recover. On the ground then that this sequestration was void for the reasons given before we think that the plaintiff was entitled to recover. The sequestration was held void and was ignored in a collateral proceeding namely a suit to recover the profits taken by the sequestrate as moneys had been received. If the sequestration were voidable and not void it would have had to be set aside on appeal or in certiorari jurisdiction:- it could not have been challenged in a collateral proceeding. ( 15 ) THE question again came up for consideration in Hewitson And Milner v. Fabre 21 Q. B. D. 6. There Order 11 rule 6 provided that when the defendant is neither a British subject nor in British dominions notice of the writ and not the writ itself should be served upon him. The defendant was not a British subject nor was he resident in British dominions and yet contrary to the requirement of this rule he was served out of the jurisdiction with the writ instead of with notice of the writ. No appearance was entered on behalf of the defendant and the plaintiff accordingly signed judgment against him. The defendant thereupon took out a summons to set aside the judgment on the ground that the service of the writ was a nullity and Wills J. held that the service of the writ instead of notice in breach of Order 11 rule 6 was a nullity and not a mere irregularity and since there had been no service the proceeding were void ab initio. ( 16 ) WE may also refer to the decision of the English Court of Appeal in The King v. North Ex parte Oakey (1927) 1 K. B. 491. There the Consistory Court had made an order requiring the vicar to pay certain expenses and costs but had given him no opportunity of being heard in his defence. The vicar applied for a writ of prohibition when the order was sought to be enforced against him and since prohibition would issue only if there was lack or excess of jurisdiction the Court of Appeal was upon to consider whether the order of the Consistory Court was without jurisdiction on the ground that it was made in breach of audi alteram partem rule. All the three Lord Justices held that it was. Bankes L. J. said: -. . . All the three Lord Justices held that it was. Bankes L. J. said: -. . . and in my opinion the Chancellor had no jurisdiction to make an order for payment against any of them without a special citation informing them that damages and costs were being asked against them. Scrutton L. J. also pointed out:- In my opinion therefore the original proceedings in the Consistory Court were without jurisdiction and prohibition consequently would lie. Atkin L. J. too said to the same effect:- I think therefore that the Chancellor in this case had no jurisdiction to order the vicar to pay the expenses of the restoration or the costs of the proceedings. ( 17 ) THE next decision to which we refer is an important one for it is closely akin to the present case and that is the decision in Craig v. Kanssen 1943 K. B. 255. In this case a certain order was obtained by the plaintiff on a summons which was not served on the defendant. The defendant on coming to know of the making of the order took out a summons asking that the order should be set aside on the ground that the summons on which the order was made had not been served upon him as required by the rules of the Supreme Court. The question debated on the summons was whether the Court was entitled to set aside the order in its inherent jurisdiction or it was necessary for the defendant to prefer an appeal against it. Croom Johnson J. before whom the summons came for hearing on appeal from the Master took the view that the procedure adopted was not correct and the only way of getting the order set aside was by an appeal from the order and he accordingly rejected the summons. The defendant thereupon preferred an appeal and a very strong Bench consisting of Lord Green M. R. and Goddard L. J. reversed the judgment of Croom Johnson J. and held that failure to serve rendered null and void the order made against the party who should have been served and the Court could set aside such an order in its inherent jurisdiction and it was not necessary to appeal from it. Lord Green M. R. pointed out:-THE second argument was more serious in its nature. Lord Green M. R. pointed out:-THE second argument was more serious in its nature. It was that the order was a nullity and that therefore the defendant was entitled to have it set aside ex debito justitiae irrespective of Order LXX rule 1. AND after examining the relevant decisions on the point the learned Master of Rolls proceeded to state:- those cases appear to me to establish that a person who is affected by an order which can properly be described as a nullity is entitled ex debito justitiae to have it set aside. So far as procedure is concerned. it seems to me that the Court in its inherent jurisdiction can set aside its own order and that it is not necessary to Appeal from it. . . . . . it is beyond question that failure to serve process where service of process required goes to the root of our conceptions of the proper procedure in litigation. Apart from proper ex parte proceedings the idea that an order can validly be made against a man who has had no notification of any intention to apply for it has never been adopted in this country. It cannot be maintained that an order which has been made in those circumstances is to be treated as a mere irregularity and not as something which is affected by a fundamental vice the Master of Rolls accordingly held that the order was a nullity and Goddard L. J. expressed his agreement with this view. ( 18 ) REFERENCE may also be made in this connection to the decision of the Privy Council in Marsh v. Marsh (1945) A. C. 271. It is not necessary to state the facts of this case but it would be sufficient if we refer to the following observations from the judgment of Lord Goddard. Speaking of the distinction between void and voidable acts the learned Law Lord said:-THE practical difference between the two is that if the order is void the party to whom it purports to affect can ignore it and he who has obtained it will proceed thereon at his peril while if it be voidable only the party affected must get it set aside. No Court has ever attempted to lay down a decisive test for distinguishing between the two classes of irregularities nor will their Lordships attempt to do so here beyond saying that one test that may be applied is to inquire whether the irregularity has caused a failure of natural justice. (The underlining is ours ). If therefore the irregularity complained involves a failure of natural justice it would have the effect of rendering the order void and not voidable. ( 19 ) SO also in Ridge v. Baldwin (supra) Lord Reid Lord Hodson and Lord Morris of Borth-y-Gest clearly took the view that breach of audi alteram partem renders the decision a nullity though Lord Evershed and Lord Devlin who were in a minority held that the decision given in breach of audi alteram partem would not be a nullity but would be voidable at the discretion of the Court. There was some debate before us as to what exactly was the view taken by Lord Morris of Borth-y-Gest:- did he agree with Lord Reid and Lord Hodson that a decision in breach of audi alteram partem would be a nullity or did he hold with Lord Evershed and Lord Devlin that such a decision would be merely voidable and not void ? The learned Advocate General relying on certain observations of the Judicial Committee of the Privy Council in Durayappah v. Fernando (1967) 2 A. C. 337 contended that the view taken by Lord Morris of Borth-ygest was that the decision would be voidable and not a nullity and that view therefore represented the majority view as against the minority view held by Lord Reid and Lord Hodson but we do not think this contention is correct. It proceeds upon a misreading of the judgment of Lord Morris of Borth-y-Gest. It is difficult to see how Lord Morris of Borth-y-Gest can be taken to have supported Lord Evershed and Lord Devlin when he clearly and repeatedly held that the decision against the chief constable was void in the sense of nullity and would have been so even if there had been no express contravention of the police Regulations. Vide the observations of Lord Morris of Borth-y-Gest in the extract from his speech quoted above. Vide the observations of Lord Morris of Borth-y-Gest in the extract from his speech quoted above. It is clear from his judgment that he argued against the contention that the decision was only voidable in the sense understood by Lord Evershed and Lord Devlin by pointing out that all that voidable can mean in this context is that the issue must at some stage if the parties are irreconcilable be determined by the Court. But that was only to say that the decision of the Court was awaited and in no way affected the claim that the purported decision was no decision. It is therefore indisputable that the majority decision in Ridge v. Baldwin was that a decision given in breach of audi alteram partem rule is void and not voidable. ( 20 ) THE decision of the Judicial Committee of the Privy Council in Durayappah v. Fernando (supra) also supports the same view if it is closely examined. The Jaffna Municipality was dissolved by the Minister of Local Government by virtue of power conferred on him by sec. 277 of the Municipal Council Ordinance which authorised such action if it appeared to the Minister that a municipal council is not competent to perform or persistently makes default in the performance of any duty or duties imposed upon it. . . No opportunity was given to the Council to make representation to the Minister or even to the Commissioner who had investigated its affairs before making the order dissolving the Council. The Council did not take any action but the Mayor sought certiorari to quash the order of the Minister on the ground that it was made in breach of audi alteram partem rule. He also sought a declaration that he was still entitled to act as Mayor. Lord Upjohn giving the judgment of the Board held that the Minister in making the order was bound to observe audi alteram partem rule and this rule was admittedly violated by him. The learned Law Lord then proceeded to consider the effect of breach of this rule and observed:-APART altogether from authority their Lordships would be of opinion that this was a case where the Ministers order was voidable and not a nullity. The learned Law Lord then proceeded to consider the effect of breach of this rule and observed:-APART altogether from authority their Lordships would be of opinion that this was a case where the Ministers order was voidable and not a nullity. These observations were strongly relied upon by the learned Advocate General on behalf of the second respondent but we do not think that if they are properly read in their context they support his contention. The learned Law Lord used two words in these observations namely voidable and nullity and it is clear from the subsequent portion of his judgment that he used the word voidable contrast to nullity and by nullity what he meant was something absolutely void of which any person having a legitimate interest can take advantage. When the learned Law Lord used the word voidable he did not use it in the sense in which Lord Evershed and Lord Devlin used it in Ridge v. Baldwin. According to Lord Evershed and Lord Devlin voidable decision would be valid and of effect until set aside or quashed and that is the proper sense in which the word voidable is ordinarily used. But Lord Upjohn made it clear that that was not the sense in which he was using that word. He pointed out:-THEIR Lordships entirely agree. . . that if the decision is challenged by the person aggrieved on the grounds that the principle has not been obeyed he is entitled to claim that as against him it is void an initio and has never been of any effect. But it cannot possibly be right in the type of case which their Lordships are considering to suppose that if challenged successfully by the person entitled to avoid the order yet nevertheless it has some limited effect even against them until set aside by a Court of competent jurisdiction. Voidable as now conceived by the Judicial Committee therefore differs from nullity only in that its assertion is confined to the party directly affected. This decision of the Judicial Committee lays down only a limited proposition namely that a decision given in breach of audi alteram partem rule is not absolutely void in the sense that even a third party can set up its voidness but is only relatively void qua the party affected. . This decision of the Judicial Committee lays down only a limited proposition namely that a decision given in breach of audi alteram partem rule is not absolutely void in the sense that even a third party can set up its voidness but is only relatively void qua the party affected. . ( 21 ) THE same view as to the effect of audi alteram partem rule has also been consistently taken by Courts in India. In Collector of Customs v. A. H. A. Rehman A. I. R. 1957 Mad. 496 a Division Bench of the Madras High Court pointed out that where the Collector of Customs passed an order of confiscation or penalty without notice and without inquiry the order contravenes every principle of natural justice and must be held to be a nullity. So also in U. P. State v. Mohammad Noon A. I. R. 1958 S. C. 86 S. R. Das C. J. speaking on behalf of the majority observed:-IF an inferior Court or tribunal of first instance acts wholly without jurisdiction or patently in excess of jurisdiction or manifestly conducts the proceedings before it in a manner which is contrary to the rules of natural justice and all accepted rules of procedure and which offends the superior Courts sense of fair play the superior Court may we think quite properly exercise its power to issue the prerogative writ of certiorari to correct the error of the Court or tribunal of first instance even if an appeal to another inferior Court or tribunal was available and recourse was not had to it or if recourse was had to it confirmed what ex facie was a nullity for reasons aforementioned. (Italic is ours ). These observations clearly show that according to the Supreme Court an order passed in breach of the principles of natural justice would be ex facie. . . a nullity. On the strength of these observations a Division Bench of this Court also held in T. P. Kumaran v. R. Kothandaraman III G. L. R. 856 that if there is violation of the principles of natural justice such as want of notice it would render an order null and void. . . a nullity. On the strength of these observations a Division Bench of this Court also held in T. P. Kumaran v. R. Kothandaraman III G. L. R. 856 that if there is violation of the principles of natural justice such as want of notice it would render an order null and void. There the question was whether an order of removal passed against the petitioner by the Commissioner of Income-tax was liable to be quashed by this Court in exercise of its certiorari jurisdiction under Article 226 of the Constitution. The argument urged on behalf of the Commissioner of Income-tax was that the petitioner having preferred an appeal to the President against the order of removal and the President as the appellate authority having dismissed the appeal the order of dismissal passed by the Commissioner of Income-Tax had merged in the order of the President and that being so this Court had no jurisdiction to issue a writ either against the Union of India or even against the Commissioner. This argument necessitated an inquiry into the question whether the order of dismissal passed by the Commissioner of Income-Tax had merged in the order of the President. If the order of dismissal passed by the Commissioner of Income-tax was a nullity then obviously it could not merge in the appellate order passed by the President and in that event it would be competent to this Court to examine whether it was a nullity and was liable to be set aside but not so otherwise. The Division Bench was therefore called upon to consider whether the order of dismissal passed by the Commissioner of Income-tax was a nullity and it was in this connection that the Division Bench after referring to the decision of the Supreme Court in Mohammad Noons case pointed out:-IT is clear therefore that every defect in a proceeding does not make the order of the authority of the first instance a nullity. The defect must be concerning either want of jurisdiction or excess of jurisdiction or a patent violation of the principles of natural justice such as want of notice or inquiry. It is such a defect which would render an order null and void and which would take the case out of the principle of merger. The defect must be concerning either want of jurisdiction or excess of jurisdiction or a patent violation of the principles of natural justice such as want of notice or inquiry. It is such a defect which would render an order null and void and which would take the case out of the principle of merger. This was also reaffirmed by the Supreme Court in State of Orissa v Binapani A. I. R. 1967 S. C. 1269. Shah J. speaking on behalf of the Supreme Court observed:-IT there is power to decide and determine to the prejudice of a person duty to act judicially is implicit in the exercise of such power. If the essentials of justice be ignored and an order to the prejudice of a person is made the order is a nullity. That is a basic concept of the rule of law and importance thereof transcends the significance of a decision in any particular case. (Italic is ours ). It is impossible to accept the suggestion made on behalf of the second respondent that the word nullity was used by Shah J. in these observations in a loose sense and that by the use of this word the learned Judge did not mean to convey that the order would be void ab initio. ( 22 ) THESE decisions clearly establish that an order or decision given in breach of audi alteram partem rule is void and not voidable. It is no doubt true that some of these cases were concerned with the question of validity of orders or decisions of inferior Courts or tribunals and we are not concerned here with an order or decision of an inferior Court or tribunal. But the principle on which an order or decision of an inferior Court or tribunal in breach of audi alteram partem rule is held to be void and not voidable must equally apply when we are concerned with an order or decision of a superior Court given in breach of audi alteram partem rule. But the principle on which an order or decision of an inferior Court or tribunal in breach of audi alteram partem rule is held to be void and not voidable must equally apply when we are concerned with an order or decision of a superior Court given in breach of audi alteram partem rule. If the breach of audi alteram partem rule renders an order or decision of an inferior Court or tribunal void it should a fortiori have the same nullifying consequence in case of an order or decision of a superior Court as well for the duty to observe the principles of natural justice must necessarily rest more heavily on Courts which discharge judicial functions than on inferior tribunals where the functions are often quasi judicial in character. After all the principle governing the question is the same and if in one case it renders an order or decision void equally in the other case it should have the same effect. It is for this reason that we have referred to the decisions where an order or decision of an inferior Court or tribunal is called in question on the ground of breach of audi alteram partem rule. We may point out that Hewitsons case (supra) Craig v. Kanssen (supra) and Marsh v. Marsh (supra) were decisions relating to orders made by superior Courts and in those cases it was clearly held that where there is failure of natural justice by non-observance of audi alteram partem rule the order is a nullity and the party aggrieved is entitled to have it set aside ex debito justitiae in exercise of the inherent jurisdiction of the Court. ( 23 ) BUT quite apart from authority even on principle we do not see any reason why breach of audi alteram partem rule should be held to render an order or decision merely voidable and not void. If it is voidable in the sense in which that term was used by Lord Evershed and Lord Devlin in Ridge v. Baldwin (supra) it would be voidable at the discretion of the Court and it would be open to the Court to refuse to set it aside unless in the words of Lord Evershed there was real substantial miscarriage of justice. This view would introduce wide judicial discretion since only the Court could say in any given case whether miscarriage of justice was substantial enough to activate the law. It would also provoke wide judicial disagreement-one has only to read the nine judicial opinions given in Ridge v. Baldwin to see that there would be a deep divergence of view as to how this judicial discretion if it existed should be exercised. As observed by Professor Wade in his Administrative Law this would introduce dangerous uncertaint y one might say palm-trees injustice. Natural justice has for centuries been enforced as a matter of law and not of discretion and until we reach Ridge v. Baldwin there has never been a single case where discretion has played any part in refusing relief in case of failure of audi alteram partem rule. In the very first of the long line of classic cases there was an exceptionally unmeritorious but successful applicant in the person of Richard Bentley the great scholar but quarrelsome Master of Trinity College Cambridge. The audi alteram partem rule is indeed so vital and fundamental to the basic concept of justice that where it is infringed the Courts do not pause to inquire whether there has been any miscarriage of justice as a result of its breach. The breach of natural justice is itself miscarriage of justice which entitles the applicant 10 succeed. ( 24 ) ONE main objection which was put forward by the learned Advocate General against the acceptance of this view was that if an order or decision in breach of audi alteram partem were held to be void it would be a nullity for all purposes and even a third party would be entitled to set up its voidness in a collateral proceeding. If for example the Brighton constable were content to accept dismissal and his successor made an order regulating public processions under Public Order 1936 the organisers would be able to attack it on the ground that the predecessor was in law the chief constable and that the successor was not. But this said the learned Advocate General was clearly not the position and the order or decision could not therefore be held to be void. This argument in our opinion is without force. It proceeds on an assumption that when an order is void. But this said the learned Advocate General was clearly not the position and the order or decision could not therefore be held to be void. This argument in our opinion is without force. It proceeds on an assumption that when an order is void. it must be regarded as a nullity of which any person having legitimate interest can take advantage. This assumption is plainly incorrect. When we speak of voidness we must remember that there is no such thing as voidness in the absolute sense. Voidness like most legal concepts is relative rather than absolute. The question always is void against whom ? If an order is void only against a particular person a third party cannot challenge its validity but the person against whom it is void can always set up its voidness in a collateral proceeding for against him it is void ab initio and has never been of any effect:- it has always been a nullity so far as he is concerned. Vide the decision of the Privy Council in Durayappah v. Fernando (supra ). A decision given in breach of audi alteram partem would therefore be void as against the party affected but it would be valid as against the rest of the world. ( 25 ) IT was then contended that a breach of audi alteram partem and so also a breach of the requirement of rule 139-could be waived by the party affected and therefore an order or decision given in breach of it must be held to be voidable and not void. This contention was sought to be supported by reference to certain observations in the decision of the Supreme Court in Dhirendra Nath v. Sudhir Chandra Ghosh A. I. R. 1964 S. C. 1300. Subba Rao J. speaking on behalf of the Supreme Court pointed out in that case that a workable test for the purpose of determining when an act done in breach of a mandatory provision would be a nullity or an irregularity has been laid down by Justice Coleridge in Holmes v. Russell (1841) 9 Dowl. 487 namely: -. . . Subba Rao J. speaking on behalf of the Supreme Court pointed out in that case that a workable test for the purpose of determining when an act done in breach of a mandatory provision would be a nullity or an irregularity has been laid down by Justice Coleridge in Holmes v. Russell (1841) 9 Dowl. 487 namely: -. . . but the safest rule to determine what is an irregularity and what is a nullity is to see whether the party can waive the objection; if he can waive it amounts to an irregularity; if he cannot it is a nullity now this test as pointed out by the Supreme Court itself is merely a workable test and it would not be correct to regard it as an infallible test applicable in all circumstances. This test cannot be invoked for displacing the overwhelming weight of judicial authority which has consistently taken the view that breach of audi alteram partem renders the decision a nullity. Besides audi alteram partem does not require that the Court or tribunal must give to the person an opportunity to be heard even if he does not want it and is prepared to waive it. The principle of waiver ought to be implied as part and parcel of audi alteram partem rule. Where there is waiver on the part of the person concerned there is really no breach of audi alteram partem. It is only where the person concerned has not waived observance of audi alteram partem that it can be said that non-observance constitutes breach of the rule rendering the decision a nullity. Furthermore the test adopted by Justice Coleridge proceeds on an assumption that where a breach of a mandatory provision is incapable of being waived it would be one going to jurisdiction and therefore an act in breach of it would be a nullity and conversely where the breach is capable of being waived it cannot be one affecting jurisdiction and must consequently result only in irregularity and not nullity. This assumption is not well-founded. It is not correct to say that a defect cannot be waived if it goes to jurisdiction. It is undoubtedly true that where there is total lack of jurisdiction waiver cannot help for jurisdiction cannot / be conferred by consent. This assumption is not well-founded. It is not correct to say that a defect cannot be waived if it goes to jurisdiction. It is undoubtedly true that where there is total lack of jurisdiction waiver cannot help for jurisdiction cannot / be conferred by consent. But the fact that jurisdiction cannot be extended in one direction by consent does not necessarily mean that consent cannot extend jurisdiction in other directions. Many requirements have to be fulfilled before a tribunal has jurisdiction and there is no logical reason why consent should not be able to cure absence of some of those requirements even though it cannot cure absence of others. There may be contingent defects of jurisdiction which can be waived. Consequently the fact that audi alteram partem can be waived does not automatically prove that breach of it does not go to jurisdiction. Moreover in questions of this kind we must adopt a functional approach and we do not see why nullity should be made to depend on total lack of jurisdiction. Why can the law not regard a decision as nullity if it is arrived at in breach of a vital and basic principle of justice ? The question of waiver has no relevance to the question of nullity. A nullity may be capable of waiver:- it would be where the rule violated is one laid down in the interest of the parties but not where it is laid down in the interest of public policy. The circumstance that breach of audi alteram partem is capable of being waived cannot therefore deflect us from the view we are taking. To hold that breach of audi alteram partem is a mere irregularity like any other defect in procedure rendering an order or decision merely voidable by the Court in a properly constituted proceeding would be to ignore the great importance and sanctity which is attached to this principle. Such an attempt to pull down this vital and basic principle from the high pedestal which several generations of English Judges have assigned to it cannot meet with our approval and we must refuse to give our assent to it. Such an attempt to pull down this vital and basic principle from the high pedestal which several generations of English Judges have assigned to it cannot meet with our approval and we must refuse to give our assent to it. ( 26 ) BEFORE we part with this point we must refer to one other contention of the learned Advocate General namely that in any event the appellant had by his conduct waived the breach of rule 139 and the orders of Divan J. were therefore not null and void. But we do not think there is any factual foundation for this contention. The appellant according to the statement made by him in his affidavit did not know about the orders of Divan J. until some time in May or June 1968 but at that time the appeal preferred by Manharlal Shah was pending and he was therefore justified in considering it unnecessary to take any proceeding for quashing those orders. After the appeal of Manharlal Shah was dismissed and leave granted to him to appeal to the Supreme Court was revoked the appellant without any unreasonable delay took out a summons for directions for setting aside the orders of Divan J. and the subsequent directions. This summons was undoubtedly withdrawn by him on 12th December 1968 but the order allowing the summons to be withdrawn clearly shows that the withdrawal was without prejudice to the rights and contentions of the parties. The appellant it is true did not thereafter adopt any fresh proceedings for quashing the orders of Divan J. but it is apparent that he did not do so because the Official Liquidator was going to take out the first summons for directions. As soon as the first summons for directions was taken out the appellant immediately appeared in answer to the summons and took up the contention that by reason of breach of rule 139 the orders of Divan J. were nullity. It is difficult to imagine how in these circumstances the appellant could be said to have waived the breach of rule 139. ( 27 ) NOW if the orders of Divan J. were nullity it can hardly be disputed that their voidness could be set up by the appellant in any collateral proceeding. It is difficult to imagine how in these circumstances the appellant could be said to have waived the breach of rule 139. ( 27 ) NOW if the orders of Divan J. were nullity it can hardly be disputed that their voidness could be set up by the appellant in any collateral proceeding. The appellant was as pointed out in Hewitson and Milner v. Fabre (supra) Craig v. Kanssen (supra) and Marsh v. Marsh (supra) entitled to have these orders set aside in exercise of inherent jurisdiction of this Court and for this purpose it was not necessary that the appellant should make a separate application to the Court. It was sufficient for the appellant to assert the voidness of these orders when the Official Liquidator took out the two summonses for directions. D. A. Desai J. was therefore with the greatest respect to him not right in holding that these orders could not be disregarded or ignored by him as nullity in disposing of the two summonses for directions before him. If these orders were void as held by us then obviously the proposed sale in favour of the second respondent could not be confirmed and in that event fresh directions should have been given by the learned Judge to the Official Liquidator in connection with sale of the textile mill of the Company. [ The rest of the judgment is not material for the reports. ] .