Research › Search › Judgment

Jharkhand High Court · body

2019 DIGILAW 1081 (JHR)

V. R. Minerals v. State of Jharkhand

2019-05-17

SUJIT NARAYAN PRASAD

body2019
ORDER : 1. The writ petition is against the order dated 29.09.2018 by which a demand of Rs.2,25,52,619.83/- has been casted upon the petitioner on the basis of the audit report in consequence of the mining operation excess to its entitlement. 2. It is the specific case of the petitioner that after the report submitted by audit team, show cause notice has been issued to him regarding the extra liability and in pursuance to the said show cause, he has submitted his reply but it is evident from the face of the order that there is no consideration of the response submitted by the petitioner and therefore, the said order cannot be said to be justifiable in the eye of law. 3. Ms. Aparajita Bhardwaj, learned AC to learned AG has submitted that it is the admitted case of the petitioner that he has carried out the mining operation excess of its stipulation made in the terms of the license and the same was found to be confirmed by the audit team, in consequence thereof, a liability of sum of Rs.2,25,52,619.83/- has been casted upon the petitioner and show cause notice has been issued and after considering the content of the show cause notice when it is found to be not satisfactory, the said order has been passed directing the petitioner to make payment within a period of 07 (seven) days, therefore, there is no infirmity in the said order. 4. Having heard the learned counsel for the parties and on appreciation of their rival submissions, the factual aspect which is not in dispute in this case is that the petitioner has been issued four mining leases by the competent authority and he is carrying out the mining operation but in course of an audit conducted with respect to the operation of the mining work as to whether the mining operation is excess to the lease hold area, it has been found that the mining operation is excess to the lease hold area, therefore, liability has been casted upon the petitioner and before holding the petitioner entitled to make payment, a show cause notice has been issued. 5. 5. The petitioner has responded to the said show cause as would be evident from the order dated 29.09.2018 but it is evident there from that the said show cause notice has been found to be not satisfactory and in consequence thereof, the petitioner has been directed to make payment of Rs.2,25,52,619.83/-, to be paid within a period of 07 days failing which appropriate case shall be instituted against the petitioner. 6. The petitioner has assailed the said order on the ground that there is no consideration of the show cause reply dated 04.09.2018 submitted by the petitioner. 7. Before delving with the legality and proprietory of the order and its consideration, this Court thinks it proper to make reference of the judgment rendered in the case of Commissioner of Police, Bombay vs. Gordhandas Bhanji, reported in (1952) SC 16 pr.9 which reads hereunder as:- “9. We are clear that public orders, publicly made, in exercise of a statutory authority cannot be construed in the light of explanations subsequently given by the officer making the order of what be meant, or of what was in his mind, or what he intended to do. Public orders made by public authorities are meant to have public effect and are intended to affect the actings and conduct of those to whom they are addressed and must be construed objectively with reference to the language used in the order itself.” In the case of Mohinder Singh Gill and Anr. vs. The Chief Election Commissioner, New Delhi and Ors., reported in (1978)1 SCC 405 pr.8, which reads hereunder as:- “8. The second equally relevant matter is that when a statutory functionary makes an order based on certain grounds, its validity must be judged by the reasons so mentioned and cannot be supplemented by fresh reasons in the shape of affidavit or otherwise. Otherwise, an order bad in the beginning may, by the time it comes to Court on account of a challenge, get validated by additional grounds later brought out. We may here draw attention to the observations of Bose, J. in Gordhandas Bhanji. Public orders, publicly made............itself.” In the case of East Coast Railway and Anr. Vs. Mahadev Appa Rao and Ors., reported in (2010) 7 SCC 678 pr.9, which reads hereunder as:- “9. We may here draw attention to the observations of Bose, J. in Gordhandas Bhanji. Public orders, publicly made............itself.” In the case of East Coast Railway and Anr. Vs. Mahadev Appa Rao and Ors., reported in (2010) 7 SCC 678 pr.9, which reads hereunder as:- “9. There is no quarrel with the well-settled proposition of law that an order passed by a public authority exercising administrative/executive or statutory powers must be judged by the reasons stated in the order or any record or file contemporaneously maintained. It follows that the infirmity arising out of the absence of reasons cannot be cured by the authority passing the order stating such reasons in an affidavit filed before the court where the validity of any such order is under challenge. The legal position in this regard is settled by the decision of this Court in Commr. of Police v. Gordhandas Bhanji wherein this Court observed: Public orders, publicly made.................................itself.” In the case of United Air Travel Services through its proprietor A.D.M. Anwar Khan vs. Union of India through Secretary (Ministry of External Affairs), reported in (2018) 8 SCC 141 pr.11, which reads hereunder as:- “11. The learned counsel for the petitioner has, thus, rightly drawn our attention to the Constitution Bench judgment of this Court in Mohinder Singh Gill v. Chief Election Commr. to submit that such a plea cannot be accepted. We may note that this is a well-settled legal position in many judicial pronouncements of this Court, but it is not necessary to revert to the same. In para 8 of the aforesaid judgment, V.R. Krishna Iyer, J., in his inimitable style states as under: “8. The second equally relevant matter is that when a statutory functionary makes an order based on certain grounds, its validity must be judged by the reasons so mentioned and cannot be supplemented by fresh reasons in the shape of affidavit or otherwise. Otherwise, an order bad in the beginning may, by the time it comes to court on account of a challenge, get validated by additional grounds later brought out. We may here draw attention to the observations of Bose, J. in Gordhandas Bhanji:- Public orders, publicly made......................................itself.”” It is evident from the aforesaid judgment that the reason if not reflected in the decision then it cannot be supplemented by one affidavit. 8. We may here draw attention to the observations of Bose, J. in Gordhandas Bhanji:- Public orders, publicly made......................................itself.”” It is evident from the aforesaid judgment that the reason if not reflected in the decision then it cannot be supplemented by one affidavit. 8. It is also the proposition of law that if a show cause is being issued, the same cannot be said to be a formality and if it is being responded, the consideration is to be made by the concerned authority. 9. The word 'consider' is the subject matter in a case before the Hon'ble Apex Court in the case of Chairman, Life Insurance Corporation of India and Ors. vs. A. Masilamani, reported in (2013) 6 SCC 530 pr.19, which reads hereunder as:- “19. The word “consider” is of great significance. The dictionary meaning of the same is, “to think over”, “to regard as”, or “deem to be”. Hence, there is a clear connotation to the effect that there must be active application of mind. In other words, the term “consider” postulates consideration of all relevant aspects of a matter. Thus, formation of opinion by the statutory authority should reflect intense application of mind with reference to the material available on record. The order of the authority itself should reveal such application of mind. The appellate authority cannot simply adopt the language employed by the disciplinary authority and proceed to affirm its order.” It is evident from the aforesaid stipulation made by Hon'ble Apex Court in the aforesaid paragraph as quoted here in above, the consideration means that the active application of mind, thus, the active application of mind would only come if there would be appreciation of the factual aspect. 10. The question of the factual aspect would only come and if reflected from the face of the order and if the said reason is not there showing the application of mind, the order will be said to be non-speaking and if the order is without any reason it will contrary to the principles of natural justices as has been held by Hon'ble Apex Court in the case of The Siemens Engineering & Manufacturing Co. of India ltd. vs. The Union of India and Anr., reported in (1976) 2 SCC 981 pr.6, which reads hereunder as:- “6. of India ltd. vs. The Union of India and Anr., reported in (1976) 2 SCC 981 pr.6, which reads hereunder as:- “6. Before we part with this appeal, we must express our regret at the manner in which the Assistant Collector, the Collector and the Government of India disposed of the proceedings before them. It is incontrovertible that the proceedings before the Assistant Collector arising from the notices demanding differential duty were quasi-judicial proceedings and so also were the proceedings in revision before the Collector and the Government of India. Indeed, this was not disputed by the learned Counsel appearing on behalf of the respondents. It is now settled law that where an authority makes an order in exercise of a quasi-judicial function, it must record its reasons in support of the order it makes. Every quasi-judicial order must be supported by reasons. That has been laid down by a long line of decisions of this Court ending with N.M. Desai v. Testeels Ltd. But, unfortunately, the Assistant Collector did not choose to give any reasons in support of the order made by him confirming the demand for differential duty. This was in plain disregard of the requirement of law. The Collector in revision did give some sort of reason but it was hardly satisfactory. He did not deal in his order with the arguments advanced by the appellants in their representation dated December 8, 1961 which were repeated in the subsequent representation dated June 4, 1965. It is not suggested that the Collector should have made an elaborate order discussing the arguments of the appellants in the manner of a Court of law. But the order of the Collector could have been a little more explicit and articulate so as to lend assurance that the case of the appellants had been properly considered by him. If courts of law are to be replaced by a administrative authorities and tribunals, as indeed, in some kinds of cases,with the proliferation of Administrative Law, they may have to be so replaced, it is essential that administrative authorities and tribunals should accord fair and proper hearing to the persons sought to be affected by their orders and give sufficiently clear and explicit reasons in support of the orders made by them. Then alone administrative authorities and tribunals exercising quasijudicial function will be able to justify their existence and carry credibility with the people by inspiring confidence in the adjudicatory process. The rule requiring reasons to be given in support of an order is, like the principle of audi alteram partem, a basic principle of natural justice which must inform every quasi-judicial process and this rule must be observed in its proper spirit and mere pretence of compliance with it would not satisfy the requirement of law. The Government of India also failed to give any reasons in support of its order rejecting the revision application. But we may presume that in rejecting the revision application, it adopted the same reason which prevailed with the Collector. The reason given by the Collector was, as already pointed out, hardly satisfactory and it would, therefore, have been better if the Government of India had given proper and adequate reasons dealing with the arguments advanced on behalf of the appellants while rejecting the revision application. We hope and trust that in future the customs authorities will be more careful in adjudicating upon the proceedings which come before them and pass properly reasoned orders, so that those who are affected by such orders are assured that their case has received proper consideration at the hands of the Customs Authorities and the validity of the adjudication made by the Customs Authorities can also be satisfactorily tested in a superior tribunal or court. In fact, it would be desirable that in cases arising under customs and excise laws an independent quasi-judicial tribunal, like the Income Tax Appellate Tribunal or the Foreign Exchange Regulation Appellate Board, is set up which would finally dispose of appeals and revision applications under these laws instead of leaving the determination of such appeals and revision applications to the Government of India. An independent quasi-judicial tribunal would definitely inspire greater confidence in the public mind.” In the case of S.N. Mukherjee vs. Union of India, reported in (1990) 4 SCC 594 pr.39, which reads hereunder as:- 39. The object underlying the rules of natural justice “is to prevent miscarriage of justice” and secure “fair play in action”. An independent quasi-judicial tribunal would definitely inspire greater confidence in the public mind.” In the case of S.N. Mukherjee vs. Union of India, reported in (1990) 4 SCC 594 pr.39, which reads hereunder as:- 39. The object underlying the rules of natural justice “is to prevent miscarriage of justice” and secure “fair play in action”. As pointed out earlier the requirement about recording of reasons for its decision by an administrative authority exercising quasi-judicial functions achieves this object by excluding chances of arbitrariness and ensuring a degree of fairness in the process of decision-making. Keeping in view the expanding horizon of the principles of natural justice, we are of the opinion, that the requirement to record reason can be regarded as one of the principles of natural justice which govern exercise of power by administrative authorities. The rules of natural justice are not embodied rules. The extent of their application depends upon the particular statutory framework where under jurisdiction has been conferred on the administrative authority. With regard to the exercise of a particular power by an administrative authority including exercise of judicial or quasi-judicial functions the legislature, while conferring the said power, may feel that it would not be in the larger public interest that the reasons for the order passed by the administrative authority be recorded in the order and be communicated to the aggrieved party and it may dispense with such a requirement. It may do so by making an express provision to that effect as those contained in the Administrative Procedure Act, 1946 of U.S.A. and the Administrative Decisions (Judicial Review) Act, 1977 of Australia whereby the orders passed by certain specified authorities are excluded from the ambit of the enactment. Such an exclusion can also arise by necessary implication from the nature of the subject matter, the scheme and the provisions of the enactment. The public interest underly-ing such a provision would outweigh the salutary purpose served by the requirement to record the reasons. The said requirement cannot, therefore, be insisted upon in such a case. In the case of Workmen of Meenakshi Mills Ltd. etc. vs. Meenakshi Mills Ltd. and Anr., reported in AIR 1994 SC 2696 pr.42, which reads hereunder as:- “42.............We have already dealt with the nature of the power that is exercised by the appropriate Government or the authority while refusing or granting permission under sub-sec. In the case of Workmen of Meenakshi Mills Ltd. etc. vs. Meenakshi Mills Ltd. and Anr., reported in AIR 1994 SC 2696 pr.42, which reads hereunder as:- “42.............We have already dealt with the nature of the power that is exercised by the appropriate Government or the authority while refusing or granting permission under sub-sec. (2) and have found that the said power is not purely administrative in character but partakes exercise of a function which is judicial in nature. The exercise of the said power envisages passing of a speaking order on an objective consideration of relevant facts after affording an opportunity to the concerned parties. Principles or guidelines are insisted with a view to control the exercise of discretion conferred by the statute. There is need for such principles or guidelines when the discretionary power is purely administrative in character to be exercised on the subjective opinion of the authority. The same is, however, not true when the power is required to be exercised on objective considerations by a speaking order after affording the parties an opportunity to put forward their respective points of view..............” In the case of Chairman, Disciplinary Authority, Rani Lakshmi Bai Kshetriya Gramin Bank vs. Jagdish Sharan Varshney and Ors., reported in (2009) 4 SCC 240 pr.8, which reads hereunder as :- “8. The purpose of disclosure of reasons, as held by a Constitution Bench of this Court in S.N. Mukherjee v. Union of India, is that people must have confidence in the judicial or quasi-judicial authorities. Unless reasons are disclosed, how can a person know whether the authority has applied its mind or not? Also, giving of reasons minimises the chances of arbitrariness. Hence, it is an essential requirement of the rule of law that some reasons, at least in brief, must be disclosed in a judicial or quasi-judicial order, even if it is an order of affirmation.” 11. Also, giving of reasons minimises the chances of arbitrariness. Hence, it is an essential requirement of the rule of law that some reasons, at least in brief, must be disclosed in a judicial or quasi-judicial order, even if it is an order of affirmation.” 11. This case although has been listed under the heading for fresh filing although the prayer for time has been made on behalf of learned AC to learned AG but question herein is that even if this Court would allow the prayer of the respondent-State for filing a counter affidavit, then also, there will be no change in the legal position as has been held in the judgment referred in the case of Commissioner of Police, Bombay vs. Gordhandas Bhanji (supra) as because even if anything would be brought on record by way of counter affidavit, the same would amount to improve the impugned order and that would not be permissible in pursuance to the law as per the judgment referred hereinabove since if reason is not in the impugned order the same cannot be developed by way of an affidavit. 12. This Court after keeping the aforesaid legal position in consideration and taking into consideration the impugned decision dated 29.09.2018 whereby and where under there is no consideration of show cause rather in one word the show cause has been rejected by saying that it is not satisfactory therefore, there is no reason as to what led the authority by holding the show cause as not satisfactory and question of satisfaction or dissatisfaction would come only if the reason would have been reflected from the face of the order. 13. In view thereof, the impugned decision dated 29.09.2018 cannot be said to be in consonance with the legal position and in pursuance to the principles of natural justice, therefore, the same is not sustainable in the eye of law, accordingly, the same is quashed. 14. 13. In view thereof, the impugned decision dated 29.09.2018 cannot be said to be in consonance with the legal position and in pursuance to the principles of natural justice, therefore, the same is not sustainable in the eye of law, accordingly, the same is quashed. 14. It is also settled position of law that on technicality no one can take advantage therefore, since this Court is quashing the impugned decision dated 29.09.2018 as such justice demand that the matter be looked into by Deputy Commissioner, Deoghar by calling for the entire records from the office of the District Mining Officer, Deoghar and to take fresh decision on the basis of the reply already submitted by the petitioner dated 04.09.2018 by passing a speaking order within a period of four weeks from the date of receipt of copy of the order. 15. In view thereof, the writ petition stands disposed of.