Shubham Gupta vs Hindustan Petroleum Corporation ...
2023 Latest Caselaw 1677 ALL

HIGH COURT OF JUDICATURE AT ALLAHABAD
 
 

?Court No. - 40
 

 
Case :- WRIT - C No. - 12780 of 2020
 
Petitioner :- Shubham Gupta
 
Respondent :- Hindustan Petroleum Corporation Ltd. through its Regional Manager and another
 
Counsel for Petitioner :- Subodh Kumar,Udit Chandra
 
Counsel for Respondent :- C.S.C.,Komal Mehrotra,Vikas Budhwar
 

 
Hon'ble Mahesh Chandra Tripathi,J.

Hon'ble Vivek Kumar Singh,J.

1. Heard Shri Udit Chandra, learned counsel for the petitioner and Shri Komal Mehrotra, learned counsel for the respondents.

2. The petitioner has invoked the writ jurisdiction of this Court under Article 226 of the Constitution of India for quashing the order dated 31.7.2022 passed by the first respondent i.e. Head of Regional Office, Hindustan Petroleum Corporation Limited, Agra Retail Regional Office, Sanjay Place Agra with further request to issue direction in the nature of mandamus directing the first respondent to issue a Letter of Intent (LOI) in favour of the petitioner.

3. The Hindustan Petroleum Corporation Limited (in brevity, HPCL) had published an advertisement on 25.11.2018 inviting applications for award of RO dealership for various districts in the State of Uttar Pradesh including one at serial no.193 "Village-Arela, Block-Dataganj on Dataganj-Bareilly Road, District Budaun". The petitioner being fully qualified in terms of the advertisement had also applied online on 24.12.2018 for opening of RO dealership at serial no.193 of the advertisement under Group '1'. The said application was to be processed through draw of lots or in other words through lottery system and the petitioner was found successful to which a communication was made to the petitioner on 03.7.2019. In response to the said communication the petitioner had duly submitted the required documents on 09.7.2019. It is alleged that on account of local petty politics, certain complaints were made to the respondents. Consequently, the respondents had informed to the petitioner through letter dated 08.8.2019 that the Land Evaluation Committee (LEC) would visit and inspect the land. It is claimed that the LEC was fully satisfied with the offered land but the said report was not given to the petitioner. However, for the reason best known to the respondent authority, the LOI was not issued in favour of the petitioner. Therefore, in an abandon precaution the petitioner wrote a letter to the first respondent on 28.1.2020, wherein he had categorically stated that Gata No.179, which is alleged to be coming in between offered plot and Datagang, Bareilly Road, Budaun, is earmarked as "Nali Sadak" i.e. Drain Road. In the said letter, it is also claimed that certain documents were also appended namely (i) State register of Nagar Palika showing Gata No.179 as Drain road (ii) RTI reply dated 27.1.2017 by which the Nagar Palika Parishad specifically apprised that there is no obstruction between Dataganj Road and the offered plot and (3) RTI document from PWD dated 27.8.2019 & 20.11.2019 and NOC issued by the Additional District Magistrate, Badaun dated 13.12.2019, wherein it is specifically stated that there is no obstruction between the petitioner's plot i.e. Gata No.179 and the Dataganj Bareilly road.

4. In this backdrop, learned counsel for the petitioner has vehemently contended that the letter issued by the Public Works Department dated 27.8.2019 clearly gives an impression that no construction can be raised between the petitioner's plot i.e. Gata No.176 (offered land) and main road as leaving ROW, the total width of the PWD road is 35 meters and even the drain road/ROW is also within 35 meters, which is earmarked for road. He submits that there is no obstruction from the road to the offered plot. Moreover, the relevant papers were submitted to the respondents through letter dated 28.1.2020. By the impugned order dated 31.7.2020 the first respondent has rejected the petitioner's application in gross violation of the principles of natural justice and without affording an opportunity of hearing to the petitioner. Since the petitioner was a successful candidate, therefore, before rejecting his application, an opportunity should be given by the authorities to the petitioner. The impugned order has been passed without application of mind. The only reason assigned in the impugned order is that Gata No.179 falls between offered land and Dataganj, Bareilly Road. In the letter dated 28.1.2020 the petitioner has specifically stated that in Nagar Palika Register, Gata No.179 is registered as a Nali Sadak i.e. Drain Road and there is no blocking of ingress and egress for Gata No.176.In support of his submission, he has placed reliance on the judgement of Apex Court in Nagarjuna Construction Co. Ltd. vs. Govt. of Andhra Pradesh reported in 2009 AIR (SCW) 49 and Ramanna Dayaram Shetty vs. International Airport Authority, (1979) 3 SCC 4989 and the judgement of this Court in Ansar Ali vs. Union of India 2019 (8) ADJ 705, wherein the Division Bench of this Court has specifically held that prior to the passing of an order rejecting for cancelling the candidature of dealership an opportunity of hearing is necessary and without that the entire order needs to be set aside.

5. Per contra, learned counsel for the respondent Corporation, on the basis of counter affidavit, submits thatthe impugned order does not suffer from any illegality and tries to justify the passing of the impugned order.

6. Heard rival submissions and perused the record.

7. In the present case, we have occasion to peruse the material available on record. The petitioner, fulfilling all requisite conditions as mentioned in the brochure of HPCL, had applied for opening of RO dealership at serial no.193. The dispute is qua to the status of land. The pre-requisite conditions are elaborately mentioned under condition no.4 (V) (J) of Guidelines on Selection of Dealers for Regular & Rural Retail Outlets Through Draw of Lots/Bidding Process. The four conditions are (i) offered land is of required dimension and abutting the road boundary, after leaving Right of Way (ROW) line of road; (ii) the offered land is also not notified for acquisition; (iii) land owner is in possession of land from beginning/edge of ROW line and (iv) there is no other land including Govt. land between ROW and offered plot. We find that the aforesaid prerequisite condition for the land is with an object that there should not be any kind of hindrance in ingress and egress on the offered plot from the main road. So far as pleadings on record is concerned, it reflects that the petitioner fulfils the condition no.(i) as offered land is in required dimension. He also fulfils the condition no.(ii) as nothing contrary has been brought on record to indicate that the offered land is notified for acquisition and also fulfils condition no.(iii) as he is in possession of the land from the beginning to the end of ROW. So far as condition no.(iv) is concerned, though no land is there in between ROW and offered plot but the same is shown from the revenue record as drain road under the municipal register. In such situation, it can hardly be presumed that said situation would affect the ingress and egress between the offered land and Dataganj Bareilly Road. In fact, the said drain road, which is in front of the petitioner's offered land, would in fact help the smooth ingress and egress of vehicles during the rainy season as the rain water will not be blocking the way. We have also occasion to peruse the impugned order dated 31.7.2020, wherein the HPCL has informed to the petitioner that the Land Evaluation Committee has visited the site offered by the petitioner on 08.8.2019 and found that the same is not meeting the required norms and passed the impugned order in one line with following observation:-

"Offered land not abutting to road. Gata no.179 is present between offered land and Dataganj-Bareilly Road".

8. Considering the aforesaid rejection order, we find that the said order has been passed by the respondent Corporation without application of mind and without giving any kind of opportunity to the petitioner.

9. A fact finding authority is under statutory obligation to consider with due care every fact for and against the petitioner and to record its finding in a manner which would clearly indicate as to whether the facts on which the order was passed have been established. Absence of the findings to disclose reasons in an order in the manner indicated above would render the order to be indefensible/unsustainable. Reason is the heart beat of every conclusion. In the absence of reasons the order becomes lifeless. Non recording of reasons renders the order to be violative of principles of natural justice. Reasons ensures transparency and fairness in decision making. It enables litigant to know reasons for acceptance or rejection of his prayer. It is statutory requirement of natural justice. Thus, failure to give reasons amounts to denial of justice.

10. An order without valid reasons cannot be sustained. To give reasons is the rule of natural justice. Highlighting this rule, Hon'ble Supreme Court held in the case of The Secretary & Curator, Victoria Memorial v. Howrah Ganatantrik Nagrik Samiti and others, JT 2010(2)SC 566 para 31 to 33 as under :-

"31. It is a settled legal proposition that not only administrative but also judicial order must be supported by reasons, recorded in it. Thus, while deciding an issue, the Court is bound to give reasons for its conclusion. It is the duty and obligation on the part of the Court to record reasons while disposing of the case. The hallmark of an order and exercise of judicial power by a judicial forum is to disclose its reasons by itself and giving of reasons has always been insisted upon as one of the fundamentals of sound administration justice - delivery system, to make known that there had been proper and due application of mind to the issue before the Court and also as an essential requisite of principles of natural justice. The giving of reasons for a decision is an essential attribute of judicial and judicious disposal of a matter before Courts, and which is the only indication to know about the manner and quality of exercise undertaken, as also the fact that the Court concerned had really applied its mind. " [Vide State of Orissa Vs. Dhaniram Luhar (JT 2004(2) SC 172 and State of Rajasthan Vs. Sohan Lal & Ors. JT 2004 (5) SCC 338:2004 (5) SCC 573].

32. Reason is the heartbeat of every conclusion. It introduces clarity in an order and without the same, it becomes lifeless. Reasons substitute subjectivity by objectivity. Absence of reasons renders the order indefensible/unsustainable particularly when the order is subject to further challenge before a higher forum. [Vide Raj Kishore Jha Vs. State of Bihar & Ors. AIR 2003 SC 4664; Vishnu Dev Sharma Vs. State of Uttar Pradesh & Ors. (2008) 3 SCC 172; Steel Authority of India Ltd. Vs. Sales Tax Officer, Rourkela I Circle & Ors. (2008) 9 SCC 407; State of Uttaranchal & Anr. Vs. Sunil Kumar Singh Negi AIR 2008 SC 2026; U.P.S.R.T.C. Vs. Jagdish Prasad Gupta AIR 2009 SC 2328; Ram Phal Vs. State of Haryana & Ors. (2009) 3 SCC 258; Mohammed Yusuf Vs. Faij Mohammad & Ors. (2009) 3 SCC 513; and State of Himachal Pradesh Vs. Sada Ram & Anr. (2009) 4 SCC 422].

33.Thus, it is evident that the recording of reasons is principle of natural justice and every judicial order must be supported by reasons recorded in writing. It ensures transparency and fairness in decision making. The person who is adversely affected may know, as why his application has been rejected."

(Emphasis supplied)

11. Non recording of reasons, non consideration of admissible evidence or consideration of inadmissible evidence renders the order to be unsustainable. Hon'ble Supreme Court in the case of Chandana Impex Pvt. Ltd. Vs. Commissioner of Customs, New Delhi, 2011 (269) E.L.T. 433 (S.C.)(para 8) held as under :-

"8. Having bestowed our anxious consideration on the facts at hand, we are of the opinion that there is some merit in the submission of learned counsel for the appellant that while dealing with an appeal under Section 130 of the Act, the High Court should have examined each question formulated in the appeal with reference to the material taken into consideration by the Tribunal in support of its finding thereon and given its reasons for holding that question is not a substantial question of law. It needs to be emphasised that every litigant, who approaches the court for relief is entitled to know the reason for acceptance or rejection of his prayer, particularly when either of the parties to the lis has a right of further appeal. Unless the litigant is made aware of the reasons which weighed with the court in denying him the relief prayed for, the remedy of appeal will not be meaningful. It is that reasoning, which can be subjected to examination at the higher forums. In State of Orissa Vs. Dhaniram Luhar2 this Court, while reiterating that reason is the heart beat of every conclusion and without the same, it becomes lifeless, observed thus :

"8.......Right to reason is an indispensable part of a sound judicial system; reasons at least sufficient to indicate an application of mind to the matter before court. Another rationale is that the affected party can know why the decision has gone against him. One of the salutary requirements of natural justice is spelling out reasons for the order made;......."

(Emphasis supplied)

12. In the case of CCT Vs. Shukla & Bros. (2010) 4 SCC 785 ( paras 20, 24 to 27) Hon'ble Supreme Court held as under:-

"20. A Bench of Bombay High Court in the case of M/s. Pipe Arts India (P) Ltd. V. Gangadhar Nathuji Golamare (2008)6 Mah LJ 280, wherein the Bench was concerned with an appeal against an order, where prayer for an interim relief was rejected without stating any reasons in a writ petition challenging the order of the Labour Court noticed, that legality, propriety and correctness of the order was challenged on the ground that no reason was recorded by the learned Single Judge while rejecting the prayer and this has seriously prejudiced the interest of justice. After a detailed discussion on the subject, the Court held: (Mah LJ pp.283-87, paras 8,10 & 12-22) "8. The Supreme Court and different High Courts have taken the view that it is always desirable to record reasons in support of the Government actions whether administrative or quasi-judicial. Even if the statutory rules do not impose an obligation upon the authorities still it is expected of the authorities concerned to act fairly and in consonance with basic rule of law. These concepts would require that any order, particularly, the order which can be subject-matter of judicial review, is reasoned one. Even in the case of Chabungbambohal Singh v. Union of India 1995 Suppl (2) SCC 83, the Court held as under: (SCC pp. 85-86, para 8) '8. ...His assessment was, however, recorded as "very good" whereas qua the appellant it had been stated "unfit". As the appellant was being superseded by one of his juniors, we do not think if it was enough on the part of the Selection Committee to have merely stated "unfit", and then to recommend the name of one of his juniors. No reason for unfitness, is reflected in the proceedings, as against what earlier Selection Committees had done to which reference has already been made."

13. The principle of natural justice has twin ingredients; firstly, the person, who is likely to be adversely affected by the action of the authorities, should be given notice to show cause thereof and granted an opportunity of hearing and secondly, the orders so passed by the authorities should give reason for arriving at any conclusion showing proper application of mind. Violation of either of them could in the given facts and circumstances of the case, vitiate the order itself. Such rule being applicable to the administrative authorities certainly requires that the judgment of the Court should meet with this requirement with higher degree of satisfaction. The order of an administrative authority may not provide reasons like a judgment but the order must be supported by the reasons of rationality. The distinction between passing of an order by an administrative or quasi-judicial authority has practically extinguished and both are required to pass reasoned orders.

14. 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. In Common Law, the concept and doctrine of natural justice, particularly which is made applicable in the decision making by judicial and quasi- judicial bodies, has assumed different connotation. It is developed with this fundamental in mind that those whose duty is to decide, must act judicially. They must deal with the question referred both without bias and they must given to each of the parties to adequately present the case made. It is perceived that the practice of aforesaid attributes in mind only would lead to doing justice. Since these attributes are treated as natural or fundamental, it is known as 'natural justice'. The principles of natural justice developed over a period of time and which is still in vogue and valid even today were: (i) rule against bias, i.e. nemo iudex in causa sua; and (ii) opportunity of being heard to the concerned party, i.e. audi alteram partem. These are known as principles of natural justice. To these principles a third principle is added, which is of recent origin. It is duty to give reasons in support of decision, namely, passing of a 'reasoned order'."

15. In A.K. Kraipak and others Vs. Union of India and Others, reported in (1970) 1 SCR 457, Hon'ble Supreme Court held that the concept of natural justice has undergone a great deal of change in recent years. In the past it was thought that it included just two rules namely (i) no one shall be a Judge in his own cause (nemo dabet esse judex propria causa) and (ii) no decision shall be given against a party without affording him a reasonable hearing (audi alteram partem). Very soon thereafter a third rule was envisaged and that is that quasi-judicial enquiries must be held in good faith, without bias and not arbitrarily or unreasonably. But in the course of years many more subsidiary rules came to be added to the rules of natural justice." (P. 468-69).

16. In Shridhar Vs. Nagar Palika, Jaunpur AIR 1990 SC 307 the Supreme Court has held that it is elementary principle of natural justice that no person should be condemned without hearing. In paragraph 8 it was held:

" 8. The High Court committed serious error in upholding the order of the Government dated 13.2.1980 in setting aside the appellant's appointment without giving any notice or opportunity to him. It is an elementary principle of natural justice that no person should be condemned without hearing. The order of appointment conferred a vested right in the appellant to hold the post of Tax Inspector, that right could not be taken away without affording opportunity of hearing to him. Any order passed in violation of principles of natural justice is rendered void. There is no dispute that the Commissioner's order had been passed without affording any opportunity of hearing to the appellant, therefore, the order was illegal and void. The High Court committed serious error in upholding the Commissioner's order setting aside the appellant's appointment. In this view, order of the High Court and the Commissioner are not sustainable in law."

17. In Nagarjuna Construction Company Limited v. Government of Andhra Pradesh, (supra), the apex Court held as follows:

?The rule of law demands that the power to determine questions affecting rights of citizens would impose the limitation that the power should be exercised in conformity with the principles of natural justice. Thus, whenever a man?s rights are affected by decisions taken under statutory powers, the court would presume the existence of a duty to observe the rules of natural justice. It is important to note in this context the normal rule that whenever it is necessary to ensure against the failure of justice, the principles of natural justice must be read into a provision. Such a course is not permissible where the rule excludes expressly or by necessary intendment, the application of the principles of natural justice, but in that event, the validity of that rule may fall for consideration.?

18. The Hon'ble Supreme Court in the case of J. Ashoka Vs. University of Agricultural Sciences & Others, (2017) 2 SCC 609 has held as under:-

"22. In G. Durga Nageshwari, it was held as under:-

"9. The above case no doubt interpreted the Indian Administrative Service Regulations. Regulation 5(5) of the said Regulations required recording of reasons for supersession. But as can be seen from the above paragraph of the Judgment, the Supreme Court based its conclusion on the right to equality guaranteed under Articles 14 and 16(1) of the Constitution and observed that recording or reasons for overlooking the claim of a person who is above and select a person below was necessary. The said principle was applied by this Court in the case of T.K. Devaraju v. State of Karnataka, ILR 1988 KAR 2084. This Court pointed out that the Regulation 5(5) of the Indian Administrative Service Regulation was only for the purpose of giving effect to Article 14 and 16(1) of the Constitution and the position would be the same even in the absence of such a regulation because of recording of reasons is the only way to ensure obedience to the fundamental right guaranteed under Articles 14 and 16(1). Therefore, in our opinion, Clause (4) of Statute 30 must be read along with Articles 14 and 16(1) of the Constitution, for the reasons, the University of Agricultural Sciences is state as defined in Article 12 of the Constitution and hence bound by the Articles included in the Fundamental Rights Chapter. Therefore, when under Clause (2) of Statute 30, a Selection Committee constituted for making selection on the basis of the performance of the candidate at the interview recommends the names in the order of merit, the power of the Board of Regents to choose best among them means normally it should proceed in the order of merit as arranged by the Selection Committee, and if it is of the view that any person placed lower is the best, it can do so, but it has to record reasons. If reasons are recorded then it can be said that the provisions of Articles 14 and 16(1) are complied with. But if a person placed below is appointed without assigning any reason, there is no other alternative than to hold that such a selection and appointment is arbitrary and violative of Articles 14 and 16(1) of the Constitution.

10. In the present case, it is not disputed that no reasons had been recorded by the Board of Regents as to why the 2nd respondent was selected for appointment in preference to the petitioner though the petitioner was placed at Sl. No. 1 and the 2nd respondent was placed at Sl. No. 3. The learned Counsel for the University submitted that reasons were not recorded in view of the earlier decision of this Court in Keshayya's case in which it was held that the Board of Regents had the power to select any one of the persons whom it considers best and make the appointment. But the precise question raised in this case and which was not raised in Keshayya's case is as to whether the Board of Regents could do so without assigning any reason. As shown earlier, the recording of reasons is a must having regard to the right guaranteed to the citizens under Articles 14 and 16(1) of the Constitution. Therefore, we are of the view that whenever the Board of Regents considers that a person placed lower in merit in the list of selected candidates recommended by the Selection Committee, it can do so only by recording reasons as to why the case of the person placed above is being overlooked and the person below is considered the best for being appointed. In the present case, no reasons have been recorded, may be for the reason the Board considered that it was unnecessary as stated by the learned Counsel. He however submitted that the Board of Regents has stated that respondent-2 is more suitable than the petitioner. That is the conclusion and not the reason. That conclusion must be preceded by the reason which is wanting in this case"

19. Considering the aforesaid facts and circumstances, we are of the considered opinion that while passing the order impugned dated 31.7.2020 the authority has not factually evaluated the record and ground reality and in most arbitrary manner the authority has passed the aforesaid order which is contrary to the record which is placed before us.

20. For the reasons mentioned above, we find that the impugned order dated 31.07.2022 cannot be sustained in the eyes of law and it is, accordingly, quashed.

21. The matter is remanded back to the first respondent for deciding the matter afresh after furnishing opportunity of hearing to all the stake holders in the matter.

22. The writ petition is, accordingly, allowed.

Order Date :- 17.1.2023

S.Chaurisia/RKP