IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
CIVIL APPEAL NO. 6774 of 2015
(@ SLP(C) NO. 16650 OF 2012)
Poonam ... Appellant
Versus
State of U.P. & Ors. ... Respondents
J U D G M E N T
Dipak Misra, J.
The appellant invoked the jurisdiction of the High Court of
Judicature at Allahbad under Article 226 of the Constitution praying, inter
alia, for issue of writ of certiorari for quashment of the order dated
2.3.2012 passed by the respondent no.2, Commissioner, Azamgarh Division,
Azamgarh in Appeal No. 85/109/153/334/M of 2008-12 and further seeking a
writ of Mandamus against the respondents not to interfere in the peaceful
functioning of fair price shop in Gram Sabha Ardauna, Tehsil Sadar,
District Mau.
2. The facts that formed the bedrock of the writ petition are that a
fair price shop being shop no. 2 was run by the 5th respondent in Gram
Sabha Ardauna, Tehsil Sadar, Block Ratanpura, District Mau, which was
allotted to him by allotment order dated 11.5.2001 and while he was
continuing, on various complaints being made against him pertaining to non-
distribution of essential commodities, Sub-Divisional Magistrate, Sadar,
District Mau ordered an enquiry and after obtaining the report, suspended
his licence and called for an explanation from him vide order dated
30.5.2008. As the factual matrix would depict vide order dated 3.6.2008
the shop of respondent no.5 was attached to another shop being run by one
Bhupendra Singh and the respondent no.5 handed over the charge of shop on
19.7.2008. On the said date the final enquiry report was placed before the
Deputy District Magistrate, Sadar, District Mau and the report reflected
that there was improper distribution of essential commodities in violation
of instructions and accordingly the competent authority by its order dated
23.7.2008 cancelled the allotment of the respondent no.5.
3. Being dissatisfied with the order of cancellation, the 5th Respondent
preferred an appeal before the Commissioner, Azamgarh assailing the order
dated 23.7.2008, along with an application for stay of the cancellation of
allotment, but the appellate authority declined to pass any interim
protective order. Eventually, the appeal preferred by the appellant was
allowed. May it be stated that the appellant herein had got herself
impleaded in the appeal on the ground that she had been allotted the shop
no.2 after cancellation of the allotment along with the licence granted in
favour of the original allottee, the appellant therein.
4. The appellate authority after hearing the appellant and the impleaded
party and upon perusal of the file, opined that the entire proceeding
against the original allottee was initiated on the basis of the oral
statements pertaining to the allegations made by some BPL card holders that
the shopkeeper had told them that their cards had been cancelled; and there
was no enquiry and investigation by the Deputy District Magistrate from the
official documents as regards the cancellation of original ration cards of
the BPL card holders; that the allottee was not provided the copy of the
investigation report and hence, he was deprived of opportunity to submit
his clarification and on the whole, there were serious procedural lapses;
and that on a careful scrutiny of number of aspects, it was perceptible
that the investigation carried out by the Block Development Officer was
absolutely faulty. Being of this view, the appellate authority by order
dated 2.3.2012, allowed the appeal of the appellant, restored the allotment
and cancelled the allotment of the subsequent allottee.
5. Aggrieved by the aforesaid order, the appellant herein who was the
subsequent allottee in respect of shop no.2 preferred C.M.W.P. No. 16390 of
2012 before the High Court which by the impugned order dated 3.4.2012
relied upon an earlier judgment in Sri Pal Yadav v. State of U.P. and
others[1] and dismissed the writ petition on the ground that she had no
right to continue the litigation being a subsequent allottee, for she had
no independent right.
6. Calling in question the legal defensibility of the order passed by
the writ court, it is submitted by Mr. Dushyant Parashar, learned counsel
for the appellant is that the approach of the High Court is absolutely
erroneous inasmuch as it had treated the allotment of the appellant in
respect of the fair price shop as a stop gap arrangement and she had
entered into the shoes of the original allottee and, therefore, her
allotment was subject to attainment of finality of cancellation order
totally remaining oblivious to the fact that she was appointed as a dealer
under Visually Handicapped quota. It is further urged by him that her
rights being independent in nature, she has a right to assail the appellate
order and the High Court could not have dismissed the writ petition without
adverting to the merits of the case.
7. Mr. Vikrant Yadav, learned counsel appearing for the State, per
contra, would contend that in the village Ardauna, two fair price shops
were in existence and one was allotted to Mr. Bhupinder Singh and the other
one to Mr. Arvind Kumar, the 5th respondent herein and on the basis of the
complaint made by the Gram Sabha, the Sub-Divisional Magistrate had
attached the shop of respondent no.5 to the shop of Bhupinder Singh, after
suspending his licence on 3.6.2008 and eventually, an order of cancellation
was passed; and when the order of cancellation was set aside in appeal,
the original allottee is entitled to get back his allotment in respect of
shop no.2. and hence, the appellant has no legal right to assail the order
passed by the appellate authority. Learned counsel for the State would
further submit that shop no.2 having become available and there being no
order that said shop is declared as the shop reserved for any kind of
quota, either vertical or horizontal, the present appellant cannot assert
any independent right in respect of the said shop.
8. At the very outset, we must unequivocally state that we are not
required to enter into the issue whether cancellation was justified or not
or the order passed by the appellate authority allowing the appeal is
defensible in the facts and circumstances of the case, for the High Court
has expressed its disinclination to enter into the said arena at the
instance of the present appellant on the foundation that she was an
allottee after the cancellation of the allotment who was the licencee to
run the fair price shop of the 5th respondent. Learned counsel for the
appellant has also rightly not advanced any argument in that regard except
emphasising on the facet that as the appellant had an independent right on
her own the High Court was under the lawful obligation to address itself
with regard to legal substantiality of the order passed by the appellate
authority on the touchstone of exercise of writ jurisdiction, however
restricted it may be. To bolster the said submission, immense emphasis is
placed on the nature of the allotment made in favour of the appellant.
9. Be it noted, before the appellate authority, the appellant had got
herself impleaded after coming to know that the 5th respondent had
preferred an appeal challenging the order of cancellation, and the
appellate authority had considered the submissions of the original allottee
as well as the present appellant. The thrust of the matter is whether the
appellant can be regarded as a person who is a necessary party to the lis
in such a situation and is entitled under law to advance the argument that
the order passed by the appellate forum being legally unsustainable, the
writ court was obliged to adjudicate the controversy on merits.
10. It is an admitted position that village Ardauna had initially two
shops. Shop no.2 was allotted in favour of the 5th respondent and he was
granted licence to run the fair price shop. On the basis of certain
complaints being received the competent authority after an enquiry had
cancelled the licence. The appellate authority after ascribing certain
reasons, has overturned the said order. The effect of the said order has
to be that the original allottee remains an allottee and his licence
continues. The appeal was preferred challenging the cancellation of
allotment and the order of licence. It is not a situation where the appeal
had been treated to have been rendered infructuous on the basis of any
subsequent event, such as, the shop in question has been demarcated for any
reserved category. In that event, such subsequent fact would have been
brought to the notice of the appellate authority and in that event,
possibly no relief could have been granted by the appellate authority to
the appellant except removing the stigma. The stand of the State is that
initially the shop no.2 was attached to the other licencee and thereafter
on the basis of the resolution passed by the Gram Sabha, it was allotted to
the present appellant though it was mentioned that it had been granted
under the visually impaired quota.
But the character of the shop remained the same.
11. At this juncture, it is obligatory on our part to refer to the
letter-circular dated 1.2.2009 issued by the Chief Secretary, which refers
to the Government Order dated 17.8.2002 in respect of the scheduled caste,
scheduled tribe and other backward classes. Thereafter, there is reference
to certain horizontal reservation which refers to the ladies of certain
reserved categories, family members of the army who had expired in the
concerned reserved category, ex-army personnel, freedom fighters of the
concerned reserved categories and their wives and the handicapped persons
of the concerned category. After so stating, the circular proceeds to
mention as under:-
“In this regard I was direction to say that for the allotment of FPS shop
in the rural and urban area, according to the above arrangement Horizontal
reservation is also approved, under which there is arrangement to give 02%
reservation to the candidate of handicapped persons. In view of the
problem of the blind persons after appropriate consideration, the
administration has decided that the blind handicapped be granted 1%
reservation under Horizontal reservation. In this manner now to the
handicapped person in place of 2% shall be approved 3% reservation and in
this manner 1% increased reservation shall be approved only for the
handicapped of blind persons. In this manner in para no.3 of the Govt
order sub para Gh adding para 3(d), the handicapped person shall be granted
1% reservation.
In this manner Horizontal reservation shall be 36% in place of 35% which is
under the total reservation category of 50%.”
12. After issue of the said circular, a further letter dated 12.8.2008
was issued which mentioned the subject granting priority to the blind
handicapped for completing the backlog in the vacant fair price shops under
the public distribution system in rural and urban area. It is relevant to
produce certain paragraphs of the said circular:-
“1. Through Govt. order no. 2715/29-6-02-162-Sa/01 dated 17th August, 2012
for the allotment of FPS shop for the implementation of reservation has
been issued guidelines and for the reservation of FPS shop also applied the
Horizontal arrangement. Under the above arrangement there is the provision
to grant 2% reservation to the handicapped. In the above horizontal there
was no clear arrangement for blind handicapped persons. Vide Govt. order
no. 311/29.06.08-162 SA/01 T.C. dated 01 February, 2008 amending the above
Govt. order granted one percent horizontal reservation to handicapped blind
person.
2. It came in the notice of the administration that in regard to the
reservation of blind handicapped persons vide Govt. order they are not
getting the representation. It is pertinent to mention here that in the
entire district of the state given the direction on the administration
level to complete the quota of reservation. The administration after
appropriate consideration has taken decision till then backlog cannot
completed for the present reservation of the blind, since then the blind
person should be granted first priority in the allotment of the shop, in
consideration they are fulfilling the prescribed condition issued by the
Govt for the allotment of the shop. In case that resident of gram Sabha,
who is entitled, the blind do not apply then the resident of concern Gram
Sabha block development area, other blind person shall be entitled to
apply. In the allotment of FPS shop under Public Distribution system on
the basis of total shop the reservation should be assessed. Up to the
completion of blind handicapped should not furnish the shop from any
category, under the public distribution system in regard to FPS shop time
to time issued Govt order should be treated amended up to this limit.”
[underling is ours]
13. Though, the narration of facts is reflective of a different contour
of controversy. i.e., allotment and grant of licence for a fair price shop,
the seminal issue, as noted hereinabove, would hinge on the answer to the
question pertaining to right to assail the order passed in appeal. The
appellant was not impleaded as a party in the appeal but she herself got
impleaded. Assuming the appellant authority would have decided the appeal
in favour of the original allottee in her absence, could the present
appellant, a subsequent allottee in respect of the same shop, have been
allowed in law to make a grievance by invoking the jurisdiction of any
statutory forum or for that matter the High Court under Article 227 of the
Constitution. In essence, whether she is a necessary party to the
litigation and entitled to contest the legal vulnerability of the order of
cancellation or in any manner advance the plea that her allotment would not
be affected despite the factum that the order of cancellation of the
earlier allottee has been quashed. To appreciate the said issue we will
dwell upon certain authorities though they may pertain to different
jurisprudence.
14. First, it is necessary to understand about the concept of necessary
and proper party. A Four-judge Bench in Udit Narain Singh Malpaharia v
Additional Member Board of Revenue, Bihar and another[2] has observed thus:-
“7. ....it would be convenient at the outset to ascertain who are necessary
or proper parties in a proceeding. The law on the subject is well
settled: it is enough if we state the principle. A necessary party is one
without whom no order can be made effectively; a proper party is one in
whose absence an effective order can be made but whose presence is
necessary for a complete and final decision on the question involved in
this proceeding. ”
15. In Vijay Kumar Kaul and others v. Union of India and others[3] the
court referred to the said decision and has opined thus:-
“36. Another aspect needs to be highlighted. Neither before the Tribunal
nor before the High Court, Parveen Kumar and others were arrayed as
parties. There is no dispute over the factum that they are senior to the
appellants and have been conferred the benefit of promotion to the higher
posts. In their absence, if any direction is issued for fixation of
seniority, that is likely to jeopardise their interest. When they have not
been impleaded as parties such a relief is difficult to grant.
37. In this context we may refer with profit to the decision in Indu
Shekhar Singh v. State of U.P.[4] wherein it has been held thus: (SCC p.
151, para 56)
“56. There is another aspect of the matter. The appellants herein were not
joined as parties in the writ petition filed by the respondents. In their
absence, the High Court could not have determined the question of inter se
seniority.”
38. In Public Service Commission v. Mamta Bisht[5] this Court while dealing
with the concept of necessary parties and the effect of non-impleadment of
such a party in the matter when the selection process is assailed observed
thus: (SCC pp. 207-08, paras 9-10)
“9. … in Udit Narain Singh Malpaharia v. Board of Revenue[6], wherein the
Court has explained the distinction between necessary party, proper party
and proforma party and further held that if a person who is likely to
suffer from the order of the court and has not been impleaded as a party
has a right to ignore the said order as it has been passed in violation of
the principles of natural justice. More so, proviso to Order 1 Rule 9 of
the Code of Civil Procedure, 1908 (hereinafter called ‘CPC’) provides that
non-joinder of necessary party be fatal. Undoubtedly, provisions of CPC are
not applicable in writ jurisdiction by virtue of the provision of Section
141 CPC but the principles enshrined therein are applicable. (Vide
Gulabchand Chhotalal Parikh v. State of Gujarat[7], Babubhai Muljibhai
Patel v. Nandlal Khodidas Barot[8] and Sarguja Transport Service v.
STAT[9].)
10. In Prabodh Verma v. State of U.P.[10] and Tridip Kumar Dingal v. State
of W.B.[11], it has been held that if a person challenges the selection
process, successful candidates or at least some of them are necessary
parties.”
16. At this juncture, it is necessary to state that in Udit Narain
(Supra) question arose whether a tribunal is a necessary party. Recently a
two-Judge Bench in Asstt. G.M State Bank of India v. Radhey Shyam
Pandey[12] referred to Hari Vishnu Kamath v. Ahmad Ishaque and Ors.[13] and
adverted to the concept of a tribunal being a necessary party and in that
context ruled that:-
“In Hari Vishnu Kamath (supra), the larger Bench was dealing with a case
that arose from Election Tribunal which had ceased to exist and expressed
the view how it is a proper party. In Udit Narain Singh (supra), the Court
was really dwelling upon the controversy with regard to the impleadment of
parties in whose favour orders had been passed and in that context observed
that tribunal is a necessary party. In Savitri Devi (supra), the Court
took exception to courts and tribunals being made parties. It is apposite
to note here that propositions laid down in each case has to be understood
in proper perspective. Civil courts, which decide matters, are courts in
the strictest sense of the term. Neither the court nor the Presiding
Officer defends the order before the superior court it does not contest.
If the High Court, in exercise of its writ jurisdiction or revisional
jurisdiction, as the case may be, calls for the records, the same can
always be called for by the High court without the Court or the Presiding
Officer being impleaded as a party. Similarly, with the passage of time
there have been many a tribunal which only adjudicate and they have nothing
to do with the lis. We may cite few examples; the tribunals constituted
under the Administrative Tribunals Act, 1985, the Custom, Excise & Service
Tax Appellate Tribunal, the Income Tax Appellate Tribunals, the Sales Tax
Tribunal and such others. Every adjudicating authority may be
nomenclatured as a tribunal but the said authority(ies) are different that
pure and simple adjudicating authorities and that is why they are called
the authorities. An Income Tax Commissioner, whatever rank he may be
holding, when he adjudicates, he has to be made a party, for he can defend
his order. He is entitled to contest. There are many authorities under
many a statute. Therefore, the proposition that can safely be culled out
is that the authorities or the tribunals, who in law are entitled to defend
the orders passed by them, are necessary parties and if they are not
arrayed as parties, the writ petition can be treated to be not maintainable
or the court may grant liberty to implead them as parties in exercise of
its discretion. There are tribunals which are not at all required to
defend their own order, and in that case such tribunals need not be arrayed
as parties.”
The principle that has been culled out in the said case is that a
tribunal or authority would only become a necessary party which is entitled
in law to defend the order.
17. The term “entitled to defend” confers an inherent right to a person
if he or she is affected or is likely to be affected by an order to be
passed by any legal forum, for there would be violation of natural justice.
The principle of audi alteram partem has its own sanctity but the said
principle of natural justice is not always put in strait jacket formula.
That apart, a person or an authority must have a legal right or right in
law to defend or assail.
18. We may first clarify that as a proposition of law it is not in
dispute that natural justice is not an unruly horse. Its applicability has
to be adjudged regard being had to the effect and impact of the order and
the person who claims to be affected; and that is where the concept of
necessary party become significant. In The General Manager, South Central
Railway, Secunderabad and another v. A.V.R. Siddhantti and Others[14] the
Court was dealing with an issue whether the private respondent therein had
approached the High Court under Article 226 of the Constitution for issue
of a writ of mandamus directing the General Manager, South Central Railway
and the Secretary, Railway Board to fix the inter se, seniority as per the
original proceedings, dated 16.10.1952, of the Railway Board and to further
direct them not to give effect to the subsequent proceedings dated
2.11.1957 and 13.01.1961 of the Board issued by way of “modification” and
‘clarification” of its earlier proceedings of 1952. The High Court
accepted the contentions of the private respondent and struck down the
impugned proceedings. A contention was canvassed before this Court that
the writ petitioners had not impleaded about 120 employees who were likely
to be affected by the decision and, therefore, there being non-impleadment
despite they being necessary parties, it was fatal to the decision.
Rejecting the said submission the court held:-
“As regards the second objection, it is to be noted that the decisions of
the Railway Board impugned in the writ petition contain administrative
rules of general application, regulating absorption in permanent
departments, fixation of seniority, pay etc. of the employees of the
erstwhile Grain Shop Departments. The respondents-petitioners are
impeaching the validity of those policy decisions on the ground of their
being violative of Articles 14 and 16 of the Constitution. The proceedings
are analogous to those in which the constitutionality of a statutory rule
regulating seniority of Government servant is assailed. In such proceedings
the necessary parties to be impleaded are those against whom the relief is
sought, and in whose absence no effective decision can be rendered by the
Court. In the present case, the relief is claimed only against the Railway
which has been impleaded through its representative. No list or order
fixing seniority of the petitioners vis-a-vis particular individuals,
pursuant to the impugned decisions, is being challenged. The employees who
were likely to be affected as a result of the re-adjustment of the
petitioner’s seniority in accordance with the principles laid down in the
Board’s decision of October 16, 1952, were, at the most, proper parties and
not necessary parties, and their non-joinder could not be fatal to the writ
petition.”
19. The court further agreed with the principle stated in B. Gopalaiah
and Ors v. Government of Andhra Pradesh[15], J.S. Sachdev and Ors. v.
Reserve Bank of India, New Delhi[16] and Mohan Chandra Joshi v. Union of
India and Ors.[17] In this context reference to the authority in State of
Himachal Pradesh and another v. Kailash Chand Mahajan and Others[18] would
be appropriate. In the said case a contention was raised that non-
impleadment of the necessary party was fatal to the writ petition. In
support of the said stand reliance was placed upon two decisions of two
different High Courts; one, State of Kerala v. Miss Rafia Rahim[19] and the
other in Padamraj v. State of Bihar[20]. The Court distinguished both the
decisions by holding thus:-
“The contention of Mr Shanti Bhushan that the failure to implead Chauhan
will be fatal to the writ petition does not seem to be correct. He relies
on State of Kerala v. Miss Rafia Rahim. That case related to admission to
medical college whereby invalidating the selection vitally affected those
who had been selected already. Equally, the case Padamraj Samarendra v.
State of Bihar, has no application. This was a case where the plea was
founded in Article 14 and arbitrary selection. The selectees were vitally
affected. The plea that the decision of the court in the absence of Chauhan
would be violative of principle of natural justice as any adverse decision
would affect him is not correct.”
The Court placed reliance on A. Janardhana v. Union of India[21] and
ultimately did not accept the submission that the writ petition was not
maintainable because of non-impleadment of the necessary party.
20. In this context the authority in Sadananda Halo and Others v. Momtaz
Ali Sheikh and Others[22] is quite pertinent. The Division Bench referred
to the decision in All India SC & ST Employees’ Assn. v. A. Arthur Jeen[23]
wherein this court had addressed the necessity in joining the necessary
candidates as parties. The Court referred to the principle of natural
justice as enunciated in Canara Bank v. Debasis Das[24]. We may profitably
reproduce the same:-
“Natural justice has been variously defined. It is another name for common
sense justice. Rules of natural justice are not codified canons. But they
are principles ingrained into the conscience of man. Natural justice is the
administration of justice in a common sense liberal way. Justice is based
substantially on natural ideals and human values. The administration of
justice is to be freed from the narrow and restricted considerations which
are usually associated with a formulated law involving linguistic
technicalities and grammatical niceties. It is the substance of justice
which has to determine its form. Principles of natural justice are those
rules which have been laid down by the courts as being the minimum
protection of the rights of the individual against the arbitrary procedure
that may be adopted by a judicial, quasi-judicial and administrative
authority while making an order affecting those rights. These rules are
intended to prevent such authority from doing injustice.”
And again:-
“Concept of natural justice has undergone a great deal of change in recent
years. Rules of natural justice are not rules embodied always expressly in
a statute or in rules framed thereunder. They may be implied from the
nature of the duty to be performed under a statute. What particular rule of
natural justice should be implied and what its context should be in a given
case must depend to a great extent on the facts and circumstances of that
case, the framework of the statute under which the enquiry is held. The old
distinction between a judicial act and an administrative act has withered
away. The adherence to principles of natural justice as recognised by all
civilised States is of supreme importance….”
21. We have referred to the aforesaid passages as they state the basic
principle behind the doctrine of natural justice, that is, no order should
be passed behind the back of a person who is to be adversely affected by
the order. The principle behind proviso to Order I Rule 9 that the Code of
Civil Procedure enjoins it and the said principle is also applicable to the
writs. An unsuccessful candidate challenging the selection as far as the
service jurisprudence is concerned is bound to make the selected candidates
parties.
22. In J.S. Yadav Vs State of U.P. & Anr[25] in Paragraph 31 it has been
held thus:-
“No order can be passed behind the back of a person adversely affecting him
and such an order if passed, is liable to be ignored being not binding on
such a party as the same has been passed in violation of the principles of
natural justice. The principles enshrined in the proviso to Order 1 Rule 9
of the Code of Civil Procedure, 1908 provide that impleadment of a
necessary party is mandatory and in case of non-joinder of necessary party,
the petitioner-plaintiff may not be entitled for the relief sought by him.
The litigant has to ensure that the necessary party is before the court, be
it a plaintiff or a defendant, otherwise the proceedings will have to fail.
In service jurisprudence if an unsuccessful candidate challenges the
selection process, he is bound to implead at least some of the successful
candidates in representative capacity. In case the services of a person
are terminated and another person is appointed at his place, in order to
get relief, the person appointed at his place is the necessary party for
the reason that even if the petitioner-plaintiff succeeds, it may not be
possible for the Court to issue direction to accommodate the petitioner
without removing the person who filled up the post manned by the petitioner-
plaintiff. (Vide Prabodh Verma V. State of U.P, Ishwar Singh Vs. Kuldip
Singh, Tridip Kumar Dingal Vs. State of W.B, State of Assam V. Union of
India and Public Service Commission V. Mamta Bisht). More so, the public
exchequer cannot be burdened with the liability to pay the salary of two
persons against one sanctioned post”.
23. To appreciate the said decision in a real perspective, it is
absolutely necessary to state the facts under which the decision was
rendered and such a statement of law was made. The issue that arose before
this Court related to an order passed by the High Court of Allahabad by
which it had dismissed the writ petition filed by the appellant challenging
the notification dated 28.05.2008 by which on the date of constitution of
the Uttar Pradesh State Human Rights Commission, the appellant was declared
to cease to hold the office as a member of the said commission. This Court
noted the facts which were relevant and germane for the disposal of the
appeal in paragraph 2. The appellant therein was appointed as a member of
the Commission on 29.06.06 for a period of five years. Certain provisions
of the Protection of Human Rights Act 1993, stood amended vide the
Protection of Human Rights (Amendment Act, 2006) which came into force on
23.11.2006. After completion of the tenure by Chairperson of the
Commission and other members in October 2007, the appellant remained the
lone working member of the Commission. The State Government issued the
notification on 28.05.2008 to the effect that the appellant had ceased to
hold the office as a Member of the Commission. The said notification was
challenged on the ground that he had been appointed for a tenure of five
years and that period could not be curtailed. The appellant had not
impleaded any of the members who had been appointed as members on
06.06.2008. Various contentions were raised on behalf of the appellant
and the said submissions were resisted by the State on two counts, namely,
that the appellant had not impleaded the newly appointed members as parties
and further he had suffered the disability by virtue of the operation of
the amended law. This court referred to the provision contained in
unamended Section 21(2) of the Act and the Amended Section 21(2) of the
Act. Prior to the amendment, the qualification prescribed for Member was
“a person who is or has been a District Judge in that State” and after the
amendment the qualification of the member was changed to the extent “he is
or has been a Judge of a High Court or District Judge in the State with a
minimum of 7 years experience as a District Judge”. The court referred to
Article 236(a) of the Constitution and Section 3(17) of the General Clauses
Act, 1897. Be it stated, the contention was advanced that a person who has
gained experience as an Additional District Judge, he would be entitled for
consideration as his experience is equivalent to that of a District Judge.
Repelling the said submission, the Court held:-
“12. The aforesaid submission seems to be very attractive but has no
substance for the reason that a cadre generally denotes a strength of a
service or a part of service sanctioned as a separate unit. It also
includes sanctioned strength with reference to grades in a particular
service. Cadre may also include temporary, supernumerary and shadow posts
created in different grades. The expressions “cadre”, “posts” and “service”
cannot be equated with each other. (See Union of India v. Pushpa Rani and
State of Karnataka v. K. Govindappa[26].) There is no prohibition in law to
have two or more separate grades in the same cadre based on an intelligent
differential. Admittedly, the post of District Judge and Additional
District Judge in the State of U.P. is neither interchangeable nor
intertransferable. The aforesaid Rules merely provide for an integrated
cadre for the aforesaid posts. Thus, the submission is liable to be
rejected being preposterous.
xxx xxx xxx
14. In such a fact situation, we do not see any cogent reason to take a
view contrary to the same for the reason that in case the legislature in
its wisdom has prescribed a minimum experience of seven years as a District
Judge knowing it fully well the existing statutory and constitutional
provisions, it does not require to be interpreted ignoring the legislative
intent. We cannot proceed with an assumption that legislature had committed
any mistake enacting the said provision. Clear statutory provision in such
a case is required to be literally construed by considering the legislative
policy. Thus, no fault can be found with the impugned judgment and order of
the High Court on this count.”
24. After so stating, the Court noted the fact that 2006 amendment was
not under challenge. However, it noted that the issue agitated by the
appellant was that the legislature never intended to apply the amended
provisions with retrospective effect and, therefore, it could not be
discontinued from the post, for his rights stood protected by the
provisions of Section 6 of the General Clauses Act. The Court referred to
the authorities in State of Punjab v. Bhajan Kaur[27], Sangam Spinners v.
Regl. Provident Fund Commr.[28], and Railway Board v. C.R.
Rangadhamaiah[29] and held as follows:-
“Thus, from the above, it is evident that accrued rights cannot be taken
away by repealing the statutory provisions arbitrarily. More so, the
repealing law must provide for taking away such rights, expressly or by
necessary implication.”
25. Thereafter, the Court proceeded to lay down as follows:-
“There is no specific word in the 2006 Amendment Act to suggest its
retrospective applicability. Rather the positive provisions of Section 1
suggest to the contrary as it reads:-
“1. Short title and commencement.—(1) ***
(2) It shall come into force on such date as the Central Government may, by
notification in the Official Gazette, appoint.”
Undoubtedly, the amended provisions came into force on 23-11-2006 vide S.O.
2002 (E), dated 23-11-2006, published in the Gazette of India, Extra Pt.
II, Section 3(ii) dated 23-11-2006. In fact, the date 23-11-2006 is the
pointer and puts the matter beyond doubt. Thus, in view of the above, we do
not have any hesitation to declare that the Notification dated 28-5-2008 is
patently illegal.”
26. After so stating, in paragraph 32 of the judgment, the Court held
thus:-
“The appellant did not implead any person who had been appointed in his
place as a Member of the Commission. More so, he made it clear before the
High Court that his cause would be vindicated if the Court made a
declaration that he had illegally been dislodged/restrained to continue as
a Member of the Commission. In view of the above, he cannot be entitled to
any other relief except the declaration in his favour which had been made
hereinabove that the impugned Notification dated 28-5-2008 is illegal.”
27. On a keen understanding of the aforesaid authority, two aspects are
clear. First, it had noted the fact what was pleaded before the High Court
that the selected members were not arrayed as parties. Thereafter, it had
proceeded to deal with the distinction between a District Judge and an
Additional District Judge, that is, for the purpose of meeting the
qualification under the amended Act. Thereafter, as is manifest, it
proceeded to analyse the retrospective applicability of the amended
provision and opined that the provision is not retrospectively applicable
and, therefore, notification is bad in law. Paragraph 31 of the decision
proceeded to state that unless necessary parties are arrayed, no relief can
be granted. Irrefragably, there can be no cavil over the said proposition
of law. Thereafter, the Division Bench proceeded to state that in case the
services of a person are terminated and another person is appointed in his
place, in order to get the relief, the person appointed at his place is the
necessary party for the reason that even if the petitioner succeeds, it may
not be possible for the Court to issue a direction to accommodate the
petitioner without removing the person who filled up the post manned by the
petitioner. To arrive at the said conclusion, five authorities have been
relied upon. We shall discuss at length the said decisions.
28. We shall deal with the authorities in seriatim. A three-judge Bench
decision in Prabodh Verma and Others v. State of Uttar Pradesh and
Others[30] requires to be addressed. The facts in the said case deserved
to be stated. In the said case the principal question that arose for
determination before this Court was the constitutional validity of two
Uttar Pradesh Ordinances, namely, (1) The Uttar Pradesh High Schools and
Intermediate Colleges (Reserve Pool Teachers) Ordinance, 1978 (U.P.
Ordinance 10 of 1978), and (2) The Uttar Pradesh High Schools and
Intermediate Colleges Reserve Pool Teachers) (Second) Ordinance, 1978 (U.P.
Ordinance 22 of 1978). The High Court on certain reasons had struck down
the ordinance. Be it noted, the writ petition was filed by the Uttar
Pradesh Madhyamik Shikshak Sangh. Apart from the question of validity, the
subsidiary question that arose before this Court is whether the termination
of the services of the appellants and the petitioner before this Court as
secondary school teachers and intermediate college lecturers following upon
the High Court judgment is valid and, if not, the relief to which they are
entitled. After narrating the facts, the Court observed that the writ
petition filed by the Sangh suffered from two serious, though not
incurable, defects. We think it appropriate to reproduce the statement of
facts as reproduced in the judgment.
“The first defect was that of non-joinder of necessary parties. The only
respondents to the Sangh’s petition were the State of Uttar Pradesh and its
concerned officers. Those who were vitally concerned, namely, the reserve
pool teachers, were not made parties — not even by joining some of them in
a representative capacity, considering that their number was too large for
all of them to be joined individually as respondents. The matter,
therefore, came to be decided in their absence. A High Court ought not to
decide a writ petition under Article 226 of the Constitution without the
persons who would be vitally affected by its judgment being before it as
respondents or at least by some of them being before it as respondents in a
representative capacity if their number is too large, and, therefore, the
Allahabad High Court ought not to have proceeded to hear and dispose of the
Sangh’s writ petition without insisting upon the reserve pool teachers
being made respondents to that writ petition, or at least some of them
being made respondents in a representative capacity, and had the
petitioners refused to do so, ought to have dismissed that petition for non-
joinder of necessary parties.”
29. Thereafter the Court proceeded to summarise its conclusion and the
relevant conclusion for the present purpose are reproduced below:-
“50 (1) A High Court ought not to hear and dispose of a writ petition
under Article 226 of the Constitution without the persons who would be
vitally affected by its judgment being before it as respondents or at least
some of them being before it as respondents in a representative capacity if
their number is too large to join them as respondents individually, and, if
the petitioners refuse to so join, then the High Court ought to dismiss the
petition for non-joinder of necessary parties.
(2) The Allahabad High Court ought not to have proceeded to hear and
dispose of Civil Miscellaneous Writ No. 9174 of 1978 — Uttar Pradesh
Madhyamik Shikshak Sangh v. State of Uttar Pradesh — without insisting upon
the reserve pool teachers being made respondents to that writ petition or
at least some of them being made respondents thereto in a representative
capacity as the number of the reserve pool teachers was too large and, had
the petitioners refused to do so, to dismiss that writ petition for non-
joinder of necessary parties.”
30. On a studied perusal of the aforesaid judgment, it is crystal clear
that this Court had opined that when the constitutional validity of a
provision is challenged and there are beneficiaries of the said provision,
some of them in a representative capacity have to be made parties failing
which the writ court would not be justified in hearing a writ petition in
the absence of the selected candidates when they are already appointed on
the basis of the provision which was under assail before the writ court.
31. In Ishwar Singh v Kuldip Singh and others[31], a two-Judge Bench was
dealing with the situation where the selection and consequent appointments
were challenged by unsuccessful candidates before the High Court primarily
on the ground that the interviews held for the said selection were a sham
affair. The High Court had quashed the selection and the appointments on
the foundation that the interviews held were neither fair nor proper
thereby vitiating the selection. This Court dislodged the order of the
High Court on a singular count which is to the following effect: -
“It is not disputed by the learned counsel for the parties that except
Ishwar Singh, no other selected candidate was impleaded before the High
Court. The selection and the appointments have been quashed entirely at
their back. It is further stated that even Ishwar Singh, one of the
selected candidates, who was a party, had not been served and as such was
not heard by the High Court. We are of the view that the High Court was
not justified in hearing the writ petition in the absence of the selected
candidates especially when they had already been appointed.”
32. The decision in the aforesaid case is graphically clear that the
selection was under challenge but the selectees were not made parties.
There can be no shadow of doubt that they were necessary parties and,
therefore, this Court expressed the view, which we have reproduced
hereinabove.
33. In Tridip Kumar Dingal and other v. State of West Bengal and
Others[32] an appeal was preferred by the appellants being aggrieved and
dissatisfied with the judgment and order passed by the High Court of
Calcutta. The facts giving rise to the appeal by special leave before this
Court were that the State of West Bengal in the Department of Health and
Family Welfare taking note of the acute shortage and non-availability of
adequate number of Medical Technologists, took an initiative to fill up the
requisite number of vacancies by taking up the matter with Employment
Exchange. A Memorandum was issued by the Assistant Director of Health
Services (Administration) to the Director of Employment Exchange for
sponsoring the names of candidates for the post of Medical Technologists.
Eventually, on the basis of the marks obtained in the oral interview, a
list was prepared. The candidates who could not get entry into the select
list challenged the same before the West Bengal Administrative Tribunal.
The tribunal granted liberty to the authorities to make appointments of the
candidates selected and empanelled subject to the result in the Original
Application. The matter at various times travelled to the High Court,
which directed for disposal of the Original Application. Eventually, the
tribunal directed for preparation of the fresh merit list on the basis of
marks obtained in the written examination and oral interview excluding
those who were already in service. The tribunal also observed that the
Committee had fixed 40% as pass marks in the oral interview and the said
standard should be applied on the total marks as pass marks and appointment
should be given from the fresh panel so prepared in order of merit subject
to reservation and filling up of vacant posts. The decision of the
tribunal was challenged before the High Court and the High Court opined
that the question of retaining those candidates who had been appointed must
be considered afresh by the tribunal since the tribunal had not assigned
any reason as to why they should be permitted to be continued in service.
The High Court had expressed the view that no sympathy should have been
shown to the candidates when the tribunal itself had expressed the opinion
that the selection process was vitiated. Various other reasons were also
ascribed by the High Court. After remit, the tribunal considering the
rivalised submissions and taking an overall view of the matter found that
the selection process was bona fide and in accordance with law and,
therefore, it requires to be approved. The tribunal further held that
appointments which had already been made by the authorities in respect of
190 candidates who had gained experience of more than three years of work
of investigation entrusted to them should not be disturbed. A direction
was issued to the State authorities to offer appointments to successful
candidates in the waiting list subject to the availability of vacancies
following medical examination and police verification. The said judgment
was challenged before the High Court which set aside the order of the
tribunal and directed a fresh panel of Medical Technologists to be prepared
by the State Government on the basis of the qualifying marks obtained both
in the written test as well as in the oral interview. Certain directions
were given by the High Court including the one if those candidates who had
already been appointed did not find place in the panel, consequential
orders would be made by the State Government but those who were in the
panel were accommodated if by reason of existing vacancies, they should be
accommodated. The said order became the subject matter of special leave
petition which was dismissed as withdrawn. As the order of the High Court
was not implemented, a contempt petition was filed. An unconditional
apology was offered on behalf of the contemners stating that they were
ready and willing to carry out the directions. At that juncture, the High
Court passed an interim order to the extent that Court was not inclined to
issue any direction for removal/termination of services of 66 persons who
were working since three to four years. The Court also directed the State
to report to the Court as regards the exact number of vacancies which were
available for the appointment of the panel to be prepared and to inform
whether nine vacancies which had become defunct could be revived. When the
matter was placed again on the next date, the High Court noted that a panel
of 586 candidates, had been prepared on the basis of 40% marks obtained by
candidates both in the written test as well as in the oral interview. It
also observed that 66 persons who had been appointed could be accommodated
by granting liberty to the State Government in the manner it thought best
without disturbing their seniority or continuity of service. It further
directed that remaining vacancies should be filled up on the basis of
seniority position from the panel of 586 candidates. With the aforesaid
directions, the contempt petition was disposed of and the said order was
assailed before this Court. After hearing the learned counsel for the
parties, this Court came to hold that the contention on behalf of the State
Government that written examination was held for shortlisting the
candidates and was in the nature of elimination test had no doubt
substance, for the said authorities regard being had to the large number of
applicants seeking appointment and small number of vacancies, had no other
option but to screen candidates by holding a written examination more so,
when there were no rules in that regard. This Court further opined that
it was an administrative decision and such a plea was raised by the State
in the first round of litigation before the tribunal which had held that
the action of State authorities to be wrong and the High Court upheld it
and State did not challenge the order before this Court and, therefore, in
the second round the High Court did not commit any error of law in
directing the authorities to prepare merit list on the basis of marks
obtained by the candidates in written examination as also in oral
interview. It was further held that in such a situation it was not open to
the State authorities to reiterate and reagitate the same ground on the
same occasion. A contention was raised on behalf of the appellant that
there cannot be more than 15% marks at the oral interview, which was not
accepted by this Court at that stage, for such a direction was issued as
early as in 2000 and the appellants were applicants before the Tribunal and
the petitioners before the High Court had accepted the said decision and
did not challenge the legality thereof by approaching this Court.
Thereafter, the Court proceeded to deal with the 66 candidates. In that
context it ruled as follows:-
“Regarding protection granted to 66 candidates, from the record it is clear
that their names were sponsored by the employment exchange and they were
selected and appointed in 1998-1999. The candidates who were unable to get
themselves selected and who raised a grievance and made a complaint before
the Tribunal by filing applications ought to have joined them (selected
candidates) as respondents in the original application, which was not done.
In any case, some of them ought to have been arrayed as respondents in a
“representative capacity”. That was also not done. The Tribunal was,
therefore, wholly right in holding that in absence of selected and
appointed candidates and without affording opportunity of hearing to them,
their selection could not be set aside.”
[Emphasis added]
34. We have referred to the said authority in a comprehensive manner to
understand the ratio. It is quite simple. If a non-selected candidate
challenges the selection, he is under legal obligation to implead the
selected candidates as they are necessary parties and there can be no two
opinions as regards such a proposition of law.
35. In State of Assam v. Union of India and Others[33] the State of
Assam, being aggrieved by the decision rendered in writ appeal and the
dismissal of the review application filed by it, had approached this Court.
The factual matrix as was presented before the Court was that Union of
India had introduced “Family Welfare Scheme” under its Family Planning
Programme and under the said Scheme, there was a provision for appointment
of Voluntary Female Attendants on a monthly honorarium of Rs.50/- per month
from the inception of the Scheme which was subsequently increased to
Rs.100/- per month, w.e.f. February, 2001. As the factual narration would
show a writ petition was filed claiming benefit from the respondents of the
pay of Rs.900/- per month, the minimum of the pay scale payable to the
Voluntary Female Attendants. A prayer was also made for regularisation. A
direction was given by the High Court that it was for the State Government
to consider the prayers in accordance with law. A similar writ was filed
by another female attendant wherein the Union of India and the State of
Assam were arrayed as respondents and the High Court disposed of the writ
petition relying on the earlier judgment. The Union of India being
aggrieved preferred a writ appeal in which it did not implead the State of
Assam as a party to those proceedings. The contention of the Union of
India was that the voluntary female attendants were not their employees
and, therefore, the Single Judge was not correct in issuing direction to
the Union of India for payment of minimum pay scale. It was urged that the
State of Assam had issued appointment letters to the said female
attendants. There was no mention in those appointment letters that they
were appointed under the centrally sponsored scheme. A prayer was made to
discharge them of their liability of any payment of wages to the private
respondents appointed by the State Government. The Division Bench accepted
the stand of the Union of India and held that the appointment letters had
nothing to link them with the centrally sponsored scheme of voluntary
workers at fixed honorarium. On the basis of the aforesaid analysis, the
Division Bench observed that the Union of India had no responsibility of
making the payment on the minimum of the pay scale to the voluntary female
attendants, and fixed the liability on the State of Assam. Being
aggrieved, the State of Assam had preferred the appeal by special leave.
The two-Judge Bench referred to the decision in Udit Narain (supra) and
opined thus:-
“15. In aid of his submission, the learned Senior Counsel has placed
reliance on the law laid down by this Court in Udit Narain Singh Malpaharia
v. Board of Revenue, wherein it was held that in proceedings for a writ of
certiorari, it is not only the tribunal or authority whose order is sought
to be quashed but also the parties in whose favour the said order is
issued, are necessary parties and that it is in the discretion of the court
to add or implead proper parties for completely settling all the questions
that may be involved in the controversy either suo motu or on the
application of a party to the writ or on application filed at the instance
of such proper party.
16. We respectfully agree with the observations made by this Court in Udit
Narain case and adopt the same. We may add that the law is now well settled
that a necessary party is one without whom, no order can be made
effectively and a proper party is one in whose absence an effective order
can be made but whose presence is necessary for a complete and final
decision of the question involved in the proceeding.
xxx xxx xxx
23. We are also unable to comprehend any possible reasons for the Union of
India to omit the State of Assam from the array of parties in the writ
appeals filed before the Division Bench of the High Court. The fact remains
that they were not made parties to the proceedings. The High Court, in our
view, while allowing the appeals filed by the Union of India and shifting
the liability of payment of salary/wages to the Voluntary Female Attendants
on the State of Assam, should have taken a little more care and caution to
find out whether the State of Assam is arrayed as a party to the
proceedings and whether they are served with the notice of the appeals and
in spite of service, whether they have remained absent. This is the least
that is expected from the Court. Without making this small verification,
the Division Bench of the High Court has fixed huge recurring financial
liability on the State Government. In our opinion, in matters of this
nature, even by mistake of the party, the proper parties were not arrayed
in the proceedings, it is the duty of the Court to see that the parties are
properly impleaded. It is well-settled principle consistent with natural
justice that if some persons are likely to be affected on account of
setting aside a decision enuring to their benefit, the Court should not
embark upon the consideration and the correctness of such decision in the
absence of such persons.”
36. The proposition of law stated hereinabove has to be understood in
proper perspective. There were two prayers in the writ petition. One was
for payment of salary, the other was for regularisation. Ultimately, the
Division Bench absolved the Union of India from liability of payment and
fastened it on the State. The State was not arrayed as a party to the lis.
That was an accepted fact. Needless to emphasise the State of Assam was a
necessary party and more so when the Union of India was taking the stand
that it was the State of Assam which had to bear the liability. The State
of Assam was entitled to resist the stand and stance put forth by the Union
of India in law.
37. In Public Service Commission, Uttranchal v. Mamta Bisht and
Others[34] it was held by a two-Judge Bench that the first respondent
therein wanted her selection against a reserved category vacancy and,
therefore, the last selected candidate in that category was a necessary
party and without impleading her the writ petition could not have been
entertained by the High Court, for if a person challenges a selection
process, successful candidates or at least some of them are to be arrayed
as parties they being necessary parties. To appreciate the controversy, we
must reproduce two paragraphs from the said authority:-
“9. In case Respondent 1 wanted her selection against the reserved category
vacancy, the last selected candidate in that category was a necessary party
and without impleading her, the writ petition could not have been
entertained by the High Court in view of the law laid down by nearly a
Constitution Bench of this Court in Udit Narain Singh Malpaharia v. Board
of Revenue, wherein the Court has explained the distinction between
necessary party, proper party and pro forma party and further held that if
a person who is likely to suffer from the order of the court and has not
been impleaded as a party has a right to ignore the said order as it has
been passed in violation of the principles of natural justice. More so,
proviso to Order 1, Rule 9 of the Code of Civil Procedure, 1908
(hereinafter called “CPC”) provides that non-joinder of necessary party be
fatal. Undoubtedly, provisions of CPC are not applicable in writ
jurisdiction by virtue of the provision of Section 141 CPC but the
principles enshrined therein are applicable. (Vide Gulabchand Chhotalal
Parikh v. State of Gujarat, Babubhai Muljibhai Patel v. Nandlal Khodidas
Barot[35] and Sarguja Transport Service v. STAT[36].)
10. In Prabodh Verma v. State of U.P. and Tridip Kumar Dingal v. State of
W.B., it has been held that if a person challenges the selection process,
successful candidates or at least some of them are necessary parties.”
38. The said decision, as we understand, clearly spells out that in the
absence of a necessary party, no adjudication can take place and, in fact,
the non-joinder would be fatal to the case.
39. The aforesaid decisions do not lay down as a proposition of law that
in every case when a termination is challenged, the affected person has to
be made a party. What has been stated is when one challenges a provision
as ultra vires the persons who are likely to be affected, some of them
should be made parties in a representative capacity. That has been the
consistent view of this Court in service jurisprudence. Some other
decisions, which have been relied upon are directly connected with regard
to the selection and selectees. On a perusal of the analysis made in J.S.
Yadav (supra), we are disposed to think that the Court has applied the
principle pertaining to the constitutional validity by equating it with the
interpretation of a provision, whether it is retrospective or prospective.
That apart, the Court, as is evident from paragraph 32 of the judgment, has
noted that the prayer made by the appellant only related to the declaratory
relief. The said decision has to be understood in the context. A ratio
of a decision has to be understood in its own context, regard being had to
the factual exposition. If there has been advertence to precedents, the
same has to be seen to understand and appreciate the true ratio. The
ratiocination in the said decision is basically founded on the
interpretation of the statutory provision and the relief claimed. The
Court has been guided by the fact that when the interpretation as regards
the provision whether it is retrospective or prospective, the selected
members are necessary parties.
40. In this regard, we may refer to the rule stated by Lord Halsbury in
Quinn v. Leathem[37]:-
“Every judgment must be read as applicable to the particular facts proved
or assumed to be proved, since the generality of the expressions which may
be found there are not intended to be expositions of the whole law but
govern and are qualified by the particular facts of the case in which such
expressions are to be found.”
41. A three-Judge Bench in Union of India and others v. Dhanwanti Devi
and others[38] while discussing about the precedent under Article 141 of
the Constitution, held that:-
“9. Before adverting to and considering whether solatium and interest
would be payable under the Act, at the outset, we will dispose of the
objection raised by Shri Vaidyanathan that Hari Krishan Khosla case[39] is
not a binding precedent nor does it operate as ratio decidendi to be
followed as a precedent and is per se per incuriam. It is not everything
said by a Judge while giving judgment that constitutes a precedent. The
only thing in a Judge’s decision binding a party is the principle upon
which the case is decided and for this reason it is important to analyse a
decision and isolate from it the ratio decidendi. According to the well-
settled theory of precedents, every decision contains three basic
postulates—(i) findings of material facts, direct and inferential. An
inferential finding of facts is the inference which the Judge draws from
the direct, or perceptible facts; (ii) statements of the principles of law
applicable to the legal problems disclosed by the facts; and (iii) judgment
based on the combined effect of the above. A decision is only an authority
for what it actually decides. What is of the essence in a decision is its
ratio and not every observation found therein nor what logically follows
from the various observations made in the judgment. Every judgment must be
read as applicable to the particular facts proved, or assumed to be proved,
since the generality of the expressions which may be found there is not
intended to be exposition of the whole law, but governed and qualified by
the particular facts of the case in which such expressions are to be found.
It would, therefore, be not profitable to extract a sentence here and there
from the judgment and to build upon it because the essence of the decision
is its ratio and not every observation found therein. The enunciation of
the reason or principle on which a question before a court has been decided
is alone binding as a precedent. The concrete decision alone is binding
between the parties to it, but it is the abstract ratio decidendi,
ascertained on a consideration of the judgment in relation to the subject-
matter of the decision, which alone has the force of law and which, when it
is clear what it was, is binding. It is only the principle laid down in the
judgment that is binding law under Article 141 of the Constitution. A
deliberate judicial decision arrived at after hearing an argument on a
question which arises in the case or is put in issue may constitute a
precedent, no matter for what reason, and the precedent by long recognition
may mature into rule of stare decisis. It is the rule deductible from the
application of law to the facts and circumstances of the case which
constitutes its ratio decidendi.
10. Therefore, in order to understand and appreciate the binding force of a
decision it is always necessary to see what were the facts in the case in
which the decision was given and what was the point which had to be
decided. No judgment can be read as if it is a statute. A word or a clause
or a sentence in the judgment cannot be regarded as a full exposition of
law. Law cannot afford to be static and therefore, Judges are to employ an
intelligent technique in the use of precedents......”
42. From the aforesaid, it is clear as day that what has been stated in
paragraph 31 in the case of J.S. Yadav (supra) does not even follow from
the authorities referred to therein. We have analysed the principle of
when and in what circumstances, a decision becomes a binding precedent. We
have also discussed the facts at length keeping in view the declaratory
relief made in the writ petition preferred before the High Court. The
context in which the observations have been made have to be kept in mind.
Regard being had to the factual scenario in entirety and further taking
note of the fact that the court was basically concerned with the
retrospective and prospective applicability of the provision, we are
disposed to think that it is not a binding precedent for the proposition
that in a case of termination or removal or dismissal, the person appointed
in the place of a terminated, removed or dismissed employee would be a
necessary party. That is how the said authority has to be understood, and
we so understand.
43. It has been held in Debasis Das (supra), the principles of natural
justice are to be determined in the context and it must depend to a great
extent on the facts and circumstances of that case. In this context, the
decision in Kailash Chand Mahajan (supra) becomes extremely apposite. May
it be noted, we have already referred to the said judgment but a detailed
analysis is necessary to understand the present controversy. In the said
case, the first respondent, after his retirement, was appointed as a Member
of the Himachal Pradesh State Electricity Board and thereafter as the
Chairman of the said Board. He was granted extensions from time to time.
The last extension was issued on June 12, 1989 for a period of three years
i.e., July 25, 1992. After the General Elections to the Legislative
Assembly which was held in January 1990, the Government issued a
notification on March 6, 1990 by which the earlier notification was
superseded and the appointment of the said respondent as Chairman was
extended from July 25, 1989 to March 6, 1990. Another notification was
issued on the same date directing that one R.S. Chauhan shall function as
the Chairman of the Board. The first respondent preferred a writ petition
assailing the validity of the notification by which his period was
curtailed and prayed for certiorari to quash the same. When the writ
petition was pending, a notification was issued terminating the appointment
of the writ petitioner. The High Court had passed a direction that no
appointment to the post of Chairman could be made till further orders of
the Court. That order was passed on 30th March, 1990. At the time of
conclusion of the hearing, the learned Advocate General after obtaining
instructions filed an undertaking to the effect that the notification dated
March 6, 1990 curtailing the period of the writ petitioner would be
withdrawn. Accepting the undertaking, the writ petition was disposed of.
On June 11, 1990, the Government withdrew both the notifications, i.e.,
March 6, 1990 and March 30, 1990. On June 11, 1990, a show cause notice
was issued to Kailash Chand Mahajan and eventually he was suspended and
R.S. Chauhan, a Member of the Board was allowed to function as the
Chairman. The issuance of the show cause notice and the order of
suspension were challenged in a writ petition. Various arguments were
advanced from both sides and the High Court eventually quashed the
notifications issued by the State. Be it noted, a contention was raised
before the High Court that R.S. Chauhan having been appointed as the
Chairman, he ought to have been impleaded as a party which was rejected by
the High Court. This Court, dwelling upon various facets, posed the
question whether the failure to implead R.S. Chauhan would be fatal to the
writ petition. Addressing the said issue, as stated earlier, this Court
distinguished the decision of Miss Rafia Rahim (supra) and Padamraj (supra)
and thereafter proceeded to state thus:-
“104. On the contrary, we think we should approach the matter from this
point of view, viz., to render an effective decision whether the presence
of Chauhan is necessary? We will in this connection refer to A. Janardhana
v. Union of India it is held as under:
“Approaching the matter from this angle, it may be noticed that relief is
sought only against the Union of India and the Ministry concerned and not
against any individual nor any seniority is claimed by anyone individual
against another particular individual and, therefore, even if technically
the direct recruits were before the court, the petition is not likely to
fail on that ground.”
105. What was the first respondent seeking in the writ petition? He was
questioning the validity of the Ordinance and the Act whereby he had been
deprived of his further continuance. What is the relief could he have asked
for against Chauhan? None. The first point is Chauhan came to be appointed
consequent to the suspension of the first respondent which suspension had
come to be stayed by the High Court on June 12, 1990. Then, again, as
pointed out by the High Court it was “till further orders”. Therefore, we
hold the failure to implead Chauhan does not affect the maintainability of
the writ petition.”
[Emphasis added]
The said decision, we are inclined to think is a binding precedent
for the purpose of understanding the concept of necessary party. The Court
has relied on the pronouncement in A. Janardhana (supra). What has been
really laid down is that R.S. Chauhan was not entitled in law to contest
the lis as Kailash Chand, the aggrieved party, was challenging the
ordinance as he had faced the curtailment of period of his tenure.
44. In this context, we may refer to certain other authorities where
there has been an expansion of the concept of necessary party. The
Constitution Bench in U.P. Awas Evam Vikas Parishad vs. Gyan Devi (Dead) by
LRs. & Ors.[40] has laid down that in a land acquisition proceeding, the
local authority is a necessary party in the proceedings before the
Reference Court and is entitled to be impleaded as a party in those
proceedings wherein it can defend the determination of the amount of
compensation by the Collector and oppose enhancement of the said amount and
also adduce evidence in that regard. That apart, it has also been stated
that in the event of enhancement of the amount of compensation by the
Reference Court, if the Government does not file an appeal, the local
authority can file an appeal against the award in the High Court after
obtaining leave of the Court. That apart, the Court also opined that in an
appeal by the person having an interest in the land seeking enhancement of
the amount of compensation awarded by the Reference Court, the local
authorities should be impleaded as a party and is entitled to be served
notice of the said appeal and that could apply to appeal in the High Court
as well as in the Supreme Court.
45. In Delhi Development Authority vs. Bhola Nath Sharma (Dead) by LRs
and Ors.[41], the question arose whether the Delhi Development Authority,
at whose instance land of the respondent and others had been acquired,
could be treated as a ‘person interested’ within the meaning of Section
3(b) of the Land Acquisition Act, 1894 and it was entitled to an
opportunity to participate in the proceedings held before the Land
Acquisition Collector and the Reference Court for determining the
compensation. The two-Judge Bench referred to U.P. Awas Evam Vikas
Parishat (supra) and relied upon a passage from SLP (C) No.1608 of 1999[42]
and eventually allowed the appeal and set aside the impugned judgment of
the High Court as well as that of the Reference Court and remitted the
matter to the Reference Court to decide the reference afresh after giving
opportunity of hearing to the parties which shall necessarily include
opportunity to adduce evidence for the purpose of determining the amount of
compensation.
46. We have referred to the aforesaid decisions with the purpose that the
company or the authority has been treated as a necessary party on the
foundation that it meets the criterion provided in the definition clause
and that apart ultimately it has to pay the compensation. Therefore, it
has a right in law to participate in the proceedings pertaining to
determination of the amount of compensation. Factual score, needless to
say, stands on a different footing.
47. Few examples can be given so that the position can be easily
appreciated. There are provisions in some legislations pertaining to Gram
Panchayat or Panchayat Samiti where on certain grounds the competent
authority has been conferred the power to remove the elected Sarpanch or
the Chairman, as the case may be on certain counts. Against the order of
the Collector, an appeal lies and eventually either a revision or a writ
lies to the High Court. After his removal, someone by way of indirect
election from amongst the members of the Panchayats or the Panchayat Samiti
is elected as the Sarpanch or the Chairman. The removed Sarpanch assails
his order of removal as he is aggrieved by the manner, method and the
reasons for removal. In his eventual success, he has to hold the post of
the Sarpanch, if the tenure is there. The question, thus, arises whether
the person who has been elected in the meantime from amongst the members of
the Panchayat Samiti or Sabha is a necessary party. The answer has to be a
categorical ‘no’, for he cannot oppose the order of removal assailed by the
affected Sarpanch nor can he defend his election because he has come into
being because of a vacancy, arising due different situation.
48. In the instant case, shop no.2 had become vacant. The appellant was
allotted the shop, may be in the handicapped quota but such allotment is
the resultant factor of the said shop falling vacant. The original
allottee, that is the respondent, assailed his cancellation and ultimately
succeeded in appeal. We are not concerned with the fact that the appellant
herein was allowed to put her stand in the appeal. She was neither a
necessary nor a proper party. The appellate authority permitted her to
participate but that neither changes the situation nor does it confer any
legal status on her. She would have continued to hold the shop had the
original allottee lost the appeal. She cannot assail the said order in a
writ petition because she is not a necessary party. It is the State or its
functionaries, who could have challenged the same in appeal. They have
maintained sphinx like silence in that regard. Be that as it may, that
would not confer any locus on the subsequent allottee to challenge the
order passed in favour of the former allottee. She is a third party to the
lis in this context. The decisions which we have referred to hereinbefore
directly pertain to the concept of necessary party. The case of Kailash
Chand Mahajan (supra) makes it absolutely clear. We have explained the
authority in J.S. Yadav’s case (supra) and opined that it has to rest on
its own facts keeping in view the declaratory relief made therein, and
further what has been stated therein cannot be regarded as a binding
precedent for the proposition that in a case of removal or dismissal or
termination, a subsequently appointed employee is a necessary party. The
said principle shall apply on all fours to a fair price shop owner whose
licence is cancelled. We may hasten to add, this concept will stand in
contradistinction to a case where the land after having vested under any
statute in the State have been distributed and possession handed over to
different landless persons. It is because of such allotment and delivery
of possession in their favour, that is required under the statute rights
are created in favour of such allottees and, therefore, they are necessary
parties as has been held in Ram Swarup & Ors. vs. S.N. Maira & Ors.[43]
The subtle distinction has to be understood. It does not relate to a post
or position which one holds in a fortuitous circumstance. It has nothing
to do with a vacancy. The land of which possession is given and the
landless persons who have received the Pattas and have remained in
possession, they have a right to retain their possession. It will be an
anarchical situation, if they are not impleaded as parties, whereas in a
case which relates to a post or position or a vacancy, if he or she who
holds the post because of the vacancy having arisen is allowed to be
treated as a necessary party or allowed to assail the order, whereby the
earlier post holder or allottee succeeds, it will only usher in the reverse
situation – an anarchy in law.
49. In this context, reference to the judgment in Ramesh Hirachand
Kundanmal vs. Municipal Corporation of Greater Bombay & Ors.[44] would be
fruitful. The two-Judge Bench was dealing with the concept of duminus
litis which relates to the plaintiff. The Court analysed the provision
contained in Order I Rule 10 and various sub-rules. The subject matter in
the case pertained to a dispute between the petitioner and the respondent
no.1 which centered on the demolition and unauthorized construction by the
competent authority under the Bombay Municipal Act. The respondent no.2
was the lessee in possession of the service station. The Municipal
Corporation had not issued any notice to the said respondent. It was
contended before the Court that the respondent no.2 was instrumental in the
initiation of the proceeding by the Municipal Corporation against him. The
court addressed to the issue whether the said respondent is a necessary or
proper party. In the said case, the appellant had instituted a case
against the third respondent for declaration that she was the lawfully
married wife of the third respondent who had entered context and admitted
the claim. An application for impleadment was sought by the respondent
nos.1 and 2 on the ground that they were respectively the wife and son of
the third respondent and they were interested in denying the appellant’s
status as wife and the children as the legitimate children of the third
respondent. The trial court had allowed the application and the said order
was confirmed by the High Court in its revisional jurisdiction. This Court
referred to the authority in Razia Begum vs. Anwar Begum[45] and came to
hold that there is a clear distinction between the suits relating to
property and those suits in which the subject matter of litigation is a
declaration as regards status or legal character. The Court observed that
in the former category, the rule of personal interest is distinguished from
the commercial interest which is required to be shown before a person may
be added as a party and accordingly held :-
“The only reason which makes it necessary to make a person a party to an
action is so that he should be bound by the result of the action and the
question to be settled, therefore, must be a question in the action which
cannot be effectually and completely settled unless he is a party. The line
has been drawn on a wider construction of the rule between the direct
interest or the legal interest and commercial interest. It is, therefore,
necessary that the person must be directly or legally interested in the
action in the answer, i.e., he can say that the litigation may lead to a
result which will affect him legally that is by curtailing his legal
rights.”
And again:-
“It is difficult to say that the rule contemplates joining as a defendant a
person whose only object is to prosecute his own cause of action. Similar
provision was considered in Amon v. Raphael Tuck & Sons Ltd.[46], wherein
after quoting the observations of Wynn-Parry, J. in Dollfus Mieg et
Compagnie S.A. v. Bank of England[47], that their true test lies not so
much in an analysis of what are the constituents of the applicants’ rights,
but rather in what would be the result on the subject matter of the action
if those rights could be established, Devlin, J. has stated:
“The test is ‘May the order for which the plaintiff is asking directly
affect the intervener in the enjoyment of his legal rights’.”
Eventually, the Court unsettled the order passed by the trial court
as well as by the High Court.
50. We have referred to the said decision in extenso as there is emphasis
on curtailment of legal right. The question to be posed is whether there
is curtailment or extinction of a legal right of the appellant. The writ
petitioner before the High Court was trying to establish her right in an
independent manner, that is, she has an independent legal right. It is
extremely difficult to hold that she has an independent legal right. It
was the first allottee who could have continued in law, if his licence
would not have been cancelled. He was entitled in law to prosecute his
cause of action and restore his legal right. Restoration of the legal
right is pivotal and the prime mover. The eclipse being over, he has to
come back to the same position. His right gets revived and that revival of
the right cannot be dented by the third party.
51. In view of the aforesaid premises, we do not perceive any merit in
this appeal and, accordingly, the same stands dismissed. There shall be no
order as to costs.
.............................J.
[Dipak Misra]
..........................., J.
[R. Banumathi]
New Delhi
October 29, 2015
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[1] 2008 (1) ADJ 718
[2] AIR 1963 SC 786
[3] (2012) 7 SCC 610
[4] (2006) 8 SCC 129
[5] (2010) 12 SCC 204
[6] AIR 1965 SC 786
[7] AIR 1965 SC 1153
[8] (1974) 2 SCC 706
[9] (1987) 1 SCC 5
[10] (1984) 4 SCC 251
[11] (2009) 1 SCC 768
[12] 2015 (3) SCALE 39
[13] AIR 1955 SC 233
[14] (1974) 4 SCC 335
[15] AIR 1969 AP 204
[16] ILR (1973) 2 Delhi 392
[17] C.W. No. 650 of 1970, decided by Delhi High Court
[18] 1992 Supp (2) SCC 251
[19] AIR 1978 Ker 176
[20] AIR 1979 Pat 266
[21] (1983) 3 SCC 601
[22] (2008) 4 SCC 619
[23] (2001) 6 SCC 380
[24] (2003) 4 SCC 557
[25] (2011) 6 SCC 570
[26] (2009) 1 SCC 1
[27] (2008) 12 SCC 112
[28] (2008) 1 SCC 391
[29] (1997) 6 SCC 623
[30] (1984) 4 SCC 251
[31] 1995 Supp (1) SCC 179
[32] (2009) 1 SCC 768
[33] (2010) 10 SCC 408
[34] (2010) 12 SCC 204
[35] (1974) 2 SCC 706
[36] (1987) 1 SCC 5
[37] (1901) AC 495, p. 506
[38] (1996) 6 SCC 44
[39] 1993 Supp (2) SCC 149
[40] (1995) 2 SCC 326
[41] (2011) 2 SCC 54
[42] Decided on 12.04.1999
[43] (1999) 1 SCC 738
[44] (1992) 2 SCC 524
[45] AIR 1958 SC 886
[46] (1954) 1 All ER 273
[47] (1950) 2 All ER 605, 611
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