M/S Healthy Agro Enterprises Pvt. ... vs The State Of Andhra Pradesh,
2021 Latest Caselaw 4010 AP

    THE HON'BLE SRI JUSTICE M.SATYANARAYANA MURTHY

                WRIT PETITION NO.16458 OF 2021

ORDER:

This writ petition is filed under Article 226 of the Constitution

of India, claiming writ of mandamus, declaring the action of the

second respondent in issuing notice Rc.No.2203/2021-D5, dated

9.7.2021 invoking jurisdiction under Section 9 of Andhra Pradesh

Rights in Land and Pattadar Pass Books Act, 1971 (Act No. 26 of

1971) (for short ‗the Act'), alleging that an extent of Ac.94-45 cents in

Sy.No.1/1, Ac.4-83 cents in Sy.No.13 and Ac.2-06 cents in

Sy.No.227, totalling to an extent of Ac.103-21 cents of Perurupadu

Village, Bollapalli Mandal, which were mutated illegally in the web

land data base in the year 2015, as illegal, arbitrary, without

jurisdiction and violative of principles of natural justice and

consequently set-aside the same.

The petitioner is a company purchased various extents of land

in Sy.No.1/1, Sy.No.13 and Sy.No.227 of Perurupadu Village,

Bollapalli Mandal under registered sale deeds in the year 1998. The

petitioner purchased the property and the name of the company was

duly mutated in the revenue records in the year 1998 itself and

copies of the adangal were issued in the year 1998 which clearly

show the name of petitioner's vendor and the name of the petitioner

company. Pattadar passbooks and title deeds were also issued in

the name of the company. The revenue records discloses the name of

the petitioner company much prior to 2015.

It is further contended that, a perusal of the impugned notice

shows the allegation that the mutation was illegally made in the web MSM,J WP_16458_2021

land data base. The manual revenue records prior to creation of web

land data base disclose the name of the company and no notice was

issued by the second respondent prior to initiation of enquiry when

the petitioner's name was being reflected prior to 2015 in the

revenue records.

It is further contended that, Section 9 of the Act, but it cannot

be invoked after a long lapse of time. The revenue records in the year

1998 itself show the name of the petitioner company. After lapse of

more than 22 years suo-moto power is invoked by the second

respondent and that too, on the allegation that an illegality was

committed in the web land data base. Therefore, such power cannot

be exercised after long lapse of time and that too, without issuing

any notice before initiating proceedings under Section 9 of the Act,

thereby the impugned notice dated 09.04.2021 is illegal and without

jurisdiction and requested to set-aside the same.

Learned Assistant Government Pleader for Revenue placed on

written instructions on record dated Rc.No.2203/2021-D5 dated

06.08.2021, though not filed counter affidavit, since the dispute is

purely based on interpretation of powers of the Joint

Collector/second respondent herein under Section 9 of the Act, while

explaining the reason for invoking such jurisdiction under Section 9

of the Act.

It is specifically submitted that, one Sri K.V.R. Sivaram Prasad,

resident of Guntur Town has filed a complaint before the Hon'ble

Lokayukta making certain allegations against the then Revenue

Officials of Bollapalli Mandal and an adverse news published under MSM,J WP_16458_2021

caption "Kanche Chenu Mesindi" in the district Edition, Andhra

Jyothi, Daily newspaper dated 09.05.2017 and "Akramala Revenue"

in the District Edition, Andhra Jyothi Daily newspaper dated

10.05.2017 mentioning that several irregularities have been

committed while mutating names of petitioner in the revenue records

of the Villages of Mellavagu, Ayyannapalem, Perurapadu, Bollapalli,

Gummanampadu, Remidicherla, Sanginidipalem and Pamidipadu of

Bollapalli Mandal.

During the enquiry in the matter, the Sub Collector,

Narasaraopet has submitted a report to the District Collector,

Guntur and in the said report it was noticed that an extent of

Ac.94.45 cents in Sy.No.1/1, Ac. 4.83 cents in Sy.No.13 and Ac.2.06

cents in Sy.No.227, totally an extent of Ac. 103.21 cents was illegally

mutated in Webland record in favour of M/S Healthy Agro

Entriprises Limited in the year 2015 vide Khata No.1044 of

Perurupadu Village of Bollapalli Mandal.

The basis for coming to such conclusion is that, as per RSR of

Perurupadu Village, the Sy.No.1/1 consisting Ac.95-71 cents, is

classified as Government Poramboke as mentioned in Column No. 14

and in the Remarks Column it was recorded as Hill Lock" (Ralla

Gutta). The Sy.No.13 consisting Ac.8-31 cents, classified as Govt.

Poramboke, no Pattadar name was mentioned in Column No.14 and

in the remarks column it was recorded as "Stream" (Vagu). Further

the Sy.No.227 consisting Ac.2-60 cents, classified as Government

Poramboke, no Pattadar name was mentioned in Column No.14 and

in the remarks column it was recorded as "Path" (Puntha).

MSM,J WP_16458_2021

On noticing the entries in revenue recorded in the name of the

petitioner herein, the District Collector, Guntur took a decision to

resume the Government land. Before resumption of the Government

land, the entries already made in record of rights are to be cancelled

by following the procedure laid down in A.P. Rights in Land and

Pattadar Pass Books Act, 1971.

It is submitted that, for cancellation of any entries in record of

rights and as well as in the Pattadar Pass Books after long time as

contended by the Petitioner himself in the Writ, under Section 9 of

the Act, "the Collector may either suo motu or on an application

made to him, call for and examine the record of any Recording

Authority, Mandal Revenue Officer or Revenue Divisional Officer

under Section 3, 5, 5-A or 5-B in respect of any record of rights

prepared or maintained to satisfy himself as to the regularity,

correctness, legality or propriety of any decision taken, order passed

or proceedings made in respect thereof and if it appears to the

Collector that any such decision, order or proceedings should be

modified, annulled or reversed or remitted for reconsideration, he

may pass orders accordingly". As per Rule 23 (2) of A.P. Rights in

Land and Pattadar Pass Books Rules, 1989, "in case, a suo motu

revision is initiated, the grounds on which the revision is (initiated)

shall be communicated to the person or persons likely to be

adversely affected.

It is further submitted that, before taking up the matter for

resumption of Government land from the persons who had got

entries in record of rights the names of such persons shall be deleted

from the record of rights duly following the procedure laid down in MSM,J WP_16458_2021

the Act. Accordingly, the matter has been taken by the Revisional

Authority & Joint Collector (RB&R), Guntur to annul the entries in

the name of the Petitioner herein and a notice was issued in

Rc.No.2203/2021-D5, dated 09.07.2021 with a direction to appear

before the Revision Authority on 24.07.2021 in person or through an

Advocate with all necessary documents showing the title over the

subject lands, as a measure of giving opportunity to the Petitioner

under the provisions of Section 9 of the ROR Act and in compliance

of Rule 23 (2) of ROR Rules, 1989. Further, the Petitioner has not

attended before the Revision Authority on 24.07.2021 and the case

has been further posted to 31.07.2021, on which date also, the

petitioner or his counsel were not attended before the Revision

Authority. It is submitted that the case is further posted to

21.08.2021.

The Petitioner herein has averred that after a lapse of more

than 22 years, suo-motu powers cannot be invoked and on the

allegation that an illegality was committed in the web land data base.

In this connection, it is pertinent to mention that there is no

limitation to take up any matter as suo-motu revision of record of

rights under Section 9 of the Act and nothing prevent the petitioner

to submit his objection before the Revision Authority to consider the

same in accordance to the provisions of the Act. The Petitioner herein

also submitted that he got purchased the subject land by means of

several registered sale deeds and thereby acquired rights over the

land. It is pertinent to mention that any registrations made by the

private parties over the Government Land are null and void and even

for the registered sale deeds from the assigned lands, the provisions

of The Andhra Pradesh Assigned Land (Prohibition of Transfer) Act, MSM,J WP_16458_2021

1977 is also applicable. Before applying such provisions, it is the

primary action proposed to be taken by the Revenue Authorities to

delete the illegal entries made in the record of rights under Section 9

of ROR Act. Hence, there is no irregularity in issue of notice to the

petitioner herein to attend before the Revision Authority to take a

decision on the entries made in favour of the petitioner in Record of

Rights and the Writ Petition filed by the Petitioner herein deserves no

consideration and finally prayed for dismissal of the writ petition.

During hearing Sri C. Raghu, learned counsel for the petitioner

would strenuously submit that, exercise of power under Section 9 of

ROR Act, after lapse of 22 years without issuing any notice before

exercise of suo-motu power of revision is an illegality, though no time

is specified, a show cause notice is required to be issued to this

petitioner, since, it would unsettle the title to the property of this

petitioner, but no such show cause notice was issued to the

petitioners before exercising such power under Section 9 of ROR Act.

Even otherwise, the settled rights cannot be disturbed after

long lapse of 22 years, as it would deprive the right to enjoy the

property guaranteed under Article 300-A of the Constitution of India

and placed reliance on judgments of Apex Court in M/s. D.N. Roy v.

State of Bihar1, Joint Collector, Ranga Reddy District v. D.

Narsingh Rao and another2 and judgment of High Court of

Judicature at Hyderabad for State of Telangana and State of Andhra

Pradesh in Abdul Rafeeq s/o late Abdul Hameed v. The State of

Telangana, rep. by its Principal Secretary3. On the strength of the

principles laid down in the above three judgments, learned counsel

1971 AIR (SC) 1045

2015 AIR (SC) 1021

2017 (6) ALT 732 MSM,J WP_16458_2021

for the petitioner requested to declare the impugned notice as illegal,

arbitrary and without jurisdiction and consequently set-aside the

same.

Whereas, learned Assistant Government Pleader for Revenue

contended that, the power of the Joint Collector is unlimited and

such power of revision under Section 9 of ROR Act can be exercised

at any time and such timeless power is exercised by the Joint

Collector - second respondent herein in view of the serious fraud

committed by the then revenue officials in mutating the name of this

petitioner in the revenue records over the subject land, while placing

reliance on the judgment of the Apex Court in A.V. Papayya Sastry

v. Government of Andhra Pradesh4. On the strength of the

principle laid down in the above judgment, learned Assistant

Government Pleader would strenuously contend that, mutation of

the name of the petitioner, for the land which is classified as

‗government land' in RSR is nothing but playing fraud on the State

and thereby, making such entries is an illegality. In such case, the

second respondent can exercise suo motu power under Section 9 of

ROR Act and requested to dismiss the writ petition.

Considering rival contentions, perusing the material available

on record, the point that arose for consideration is as follows:

"Whether exercise of power under Section 9 of Andhra Pradesh Right in Land and Pattadar Pass Books Act, after long lapse of 22 years from the date of mutation of name of this petitioner in revenue records is permissible??. If so, whether issue of show cause notice prior to initiating such proceedings, exercising suo moto power of revision by the Collector under Section 9 of ROR Act is mandatory?.

(2007) 4 SCC 211 MSM,J WP_16458_2021

P O I N T:

The facts narrated above are not in dispute. Therefore, no

counter affidavit on behalf of the respondents is filed, but argued the

matter based on Section 9 of Act itself, since the issue is only about

interpretation of Section 9 of Act.

Section 9 of ROR Act deals Revision. The Collector may

either suo motu or on an application made to him, call for and

examine the record of any Recording Authority, Mandal Revenue

Officer or Revenue Divisional Officer under Sections 3, 5, 5-A or 5-B,

in respect of any record of rights prepared or maintained to satisfy

himself as to the regularity, correctness, legality or propriety of any

decision taken, order passed or proceedings made in respect thereof

and if it appears to the Collector that any such decision, order or

proceedings should be modified, annulled or reversed or remitted for

reconsideration, he may pass orders accordingly. Provided that no

such order adversely affecting any person shall be passed under this

Section unless he had an opportunity of making a representation.

A bare look at Section 9 of ROR Act, it is clear that, power of

revision can be exercised suo motu by the Collector. Therefore,

Section 9, as it permits exercise of suo motu power by the Joint

Collector at any time, in view of the language mentioned in Section 9

of ROR Act.

Before adverting to the law laid down by the Courts, I am of

the view that, it is appropriate to advert to the notice impugned in

the writ petition and the same is extracted herein for better

appreciation of the case.

MSM,J WP_16458_2021

Collector's office, Guntur.

Dated: 09.07.2021 Rc.No.2203/2021-D5

NOTICE

The Sub-Collector, Narasaraopet has furnished a report which shows that an extent of Ac.94.45 cents in Sy.No.1/1, Ac.4.83 cents in Sy.No.13 and Ac.2.60 cents in Sy.No.227 totalling an extent of 103.21 cents were mutated illegally in the Webland data base in favour of ―Healthy Agro Enterprise Limited‖ in the year 2015 vide Khata No.1044 of Perurupadu Village and action will be initiated as per due procedure laid down in the A.P. Rights in Land and Pattadar Pass Books Act, 1971.

The matter of "illegal mutation" and issuance of Pattadar Pass Books to an extent of Ac.103.21 cents of govt. land in favour of M/S Healthy Agro Enterprises Limited has been taken up as a suo motu Revision case under Section 9 of the ROR Act and the case is posted for hearing on 17.07.2021 at 11:00 A.M.

You are therefore, directed to appear before the Joint Collector & Addl. District. Magistrate, Guntur on the above date either in person or through an Advocate with all necessary documents showing your title over the subject lands, if any available. If you fail to appear at the hearing, the matter will be decided ex-party as per the records available.‖

The reason for initiating the proceedings under Section 9 by

the second respondent is clear that, the mutation is illegal and

pattadar passbooks were issued illegally for an extent of Ac.103.21

cents of government land in favour of this petitioner. Hence, taken

up the suo motu revision under Section 9 of ROR Act and posted the

matter to specific date, calling upon this petitioner to appear either

in person or through an advocate, as such, it is clear from the notice

that initiation of proceedings is only on account of ―illegality in

mutating‖ the name of the petitioner in the revenue records and

issue of pattadar passbooks.

Who committed illegality in mutation and how illegality was

committed was not explained, except stating that the land is

registered in the name of government in RSR, mutated in the name

of this petitioner, no other details were disclosed informing this

petitioner to appropriate defense in the proceedings initiated by the MSM,J WP_16458_2021

Collector under Section 9 of ROR Act. It is not the case of State that,

fraud was played on the authorities by this petitioner or the then

revenue officials of Bollapalli Mandal played fraud on the State,

mutated the name of this petitioner in the revenue records. Hence, it

is obvious that, fraud is not the ground for initiation of the

proceedings by exercising power under Section 9 of ROR Act, but, it

is an illegality.

Sri C. Raghu, learned counsel for the petitioner would contend

that, when proceedings are sought to be initiated by exercising suo

motu power under any enactment, the authorities who are exercising

such power has to issue show cause notice expressing their opinion

to submit their explanation, expressing their intentions to initiate

suo motu proceedings under any specific enactment. But, no such

show cause notice was issued to the petitioner and thereby the

notice is vitiated by illegality.

No doubt, proceedings were initiated suo motu by the second

respondent exercising statutory power under Section 9 of ROR Act,

as no time limit is prescribed to exercise such power. Whether such

power is to be exercised at any time is to be examined by this Court.

However, in M/s. D.N. Roy v. State of Bihar (referred supra), the

Supreme Court considered an identical question, under Mineral

Concession Rules, 1949. In the facts of the above judgment, on

June 24, 1959, the Deputy Commissioner Santal Parganas caused a

notice dated June 20, 1959 published in the Bihar Gazette in

accordance with the provisions of Rule 67 of the Mineral Concession

Rules, 1949, of the availability for regrant of mining rights in respect

of fireclay over the whole of village Palasthali No. 39, situate in MSM,J WP_16458_2021

Thana Nala, Block Kasta, Sub-Division Jamtara in the District of

Santal Parganas. He announced in that notice that the said area will

be available for regrant with effect from August 1, 1959 and invited

applications for grant of mining lease in respect of that area in

accordance with the provisions of Mineral Concession Rules, 1949.

The appellant, a partnership firm applied for that lease on June 24,

1959 itself. Thereafter other persons including the 5th respondent

Nankhu Singh also applied for obtaining the lease in question. The

State Government of Bihar granted the lease to the appellant on

March 31, 1962. In pursuance of that grant a written agreement was

entered into between the State Government and the appellant and

the same was duly registered. The State Government rejected the

applications of the other applicants. Even during the pendency of the

applications before the State Government, the 5th respondent moved

the Central Government under Rule 54 of the Mineral Concession

Rules, 1960 which had replaced the 1949 Rules. Therein he prayed

that the grant of the lease in favour of the appellant, if it had been

made, should be cancelled and that he should be granted the

mineral lease in question. The Central Government served a copy of

that petition on the appellant and called for its comments. At the

same time it called for the comments of the State Government as

well. After receiving the comments of the State Government, the

same were passed on to the appellant as well as to the 5th

respondent and their further comments were called for. After

examining the representation made by the parties and the comments

offered by the State Government, the Central Government passed

orders and dismissed the petition made by the 5th respondent on

September 30, 1964. The order passed by the Central Government MSM,J WP_16458_2021

would show that the Central Government in exercise of their

revisionary power conferred by Rule 55 of Mineral Concession Rules,

1960 and all other powers enabling in this behalf hereby set aside

the order of the State Government granting Mining lease to M/s. D.

N. Roy and S. K. Banerjee and further direct them to open the area

again under Rule 58(1) of Mineral Concession Rule 1960 for re-grant.

The same was challenged before the Apex Court by M/s. D. N. Roy

and S. K. Banerjee.

Upon hearing argument of both the counsel, the Apex Court

held that the impugned order of the Central Government does not

show that it was made in the exercise of its suo motu power.- It is

purported to have been made on the basis of the application made by

the 5th respondent under Rule 54 of the Mineral Concession Rules,

1960. In paragraph 3 of that order it says "in view of the position

explained above the Central Government in exercise of their

revisionary power conferred by Rule 55 of Mineral Concession Rules,

1960 and all other powers enabling in this behalf hereby set aside

the order of the State Government contained in their letter No.

A/MM/4031/62-1789M, dated March 31, 1962". It is true that the

order in question also refers to "all other powers enabling in this

behalf". But in its return to the writ petition the Central Government

did not plead that the impugned order was passed in exercise of its

suo moto powers. ―We agree that if the exercise of a power can be

traced to an existing power even though that power was not

purported to have been exercised, under certain circumstances, the

exercise of the power can be upheld on the strength of an

undisclosed but undoubted power. But in this case the difficulty is

that at no stage the Central Government intimated to the appellant MSM,J WP_16458_2021

that it was exercising its suo moto power. At all stages it purported

to act under rules 54 and 55 of the Mineral Concession Rules, 1960.

If the Central Government wanted to exercise its suo moto power it

should have intimated that fact as well as the grounds on which it

proposed to exercise that power to the appellant and given him an

opportunity 'to show cause against the exercise of suo moto power as

well as against the grounds on which it wanted to exercise its power.

Quite clearly the Central Government had not given him that

opportunity. The High Court thought that as the Central Government

had not only intimated to the appellant the grounds mentioned in

the application made by the respondent but also the comments of

the State Government, the appellant had adequate opportunity to

put forward his case. This conclusion in our judgment is untenable.

At no stage, the appellant was informed that the Central Government

proposed to exercise its suo moto power and asked him to show

cause against the exercise of such a power. Failure of the Central

Government to do so, in our opinion, vitiates the impugned order.‖

For better appreciation, Rule 54 of Mineral Concession Rules,

1960 is extracted hereunder:

Rule 54: Application for revision.

(1) Any person aggrieved by any order made by the State Government or other authority in exercise of the powers conferred on it by the Act or these rules may, within three months of the date of communication of the order to him, apply to the Central Government in triplicate in Form N, for revision of the order. The application should be accompanied by a Bank Draft for five thousand rupees on a nationalised bank in the name of ‗Pay and Accounts Officer, Department of Mines' payable at New Delhi or through a treasury challan for five thousand rupees under the Head of Account--Non-ferrous Mining and Metallurgical Industries--Mineral Concession Fees, Rents and Royalties, Provided that any such application may be entertained after the said period of three months if the applicant satisfies the Central Government that he had MSM,J WP_16458_2021

sufficient cause for not making the application within time.

(2) In every application under sub-rule (1) against the order of a State Government refusing to grant a prospecting licence or a mining lease, any person to whom a prospecting licence or mining lease was granted in respect of the same area or for a part thereof, shall be impleaded as party.

(3) Along with the application under sub-rule (1), the applicant shall submit as many copies thereof as there are parties impleaded under sub-rule (2).

(4) On receipt of the application and the copies thereof, the Central Government shall send a copy of the application to each of the parties impleaded under sub-rule (2) specifying a date on or before which he may make his representations, if any, against the revision application.

A bare look at Rule 54 of Mineral Concession Rules, 1960, it is

clear that, no show cause notice is contemplated before initiation of

proceedings. But, the Full Bench of Apex Court held that, such

notice is required to show cause as to why suo motu proceedings

should not be initiated against this petitioner intimating the grounds

for initiation of such proceedings.

Rule 54 of Mineral Concession Rules, 1960 though not

identical to Section 9 of ROR Act. If, the principle laid down in

M/s. D.N. Roy v. State of Bihar (referred supra) is applied directly,

a show cause is required to be issued before initiation of

proceedings, exercising suo motu power under Section 9 of ROR Act.

But, no such show cause notice was issued.

Learned counsel for the petitioner also drawn attention of this

Court to judgment of the Apex Court in Joint Collector, Ranga

Reddy District v. D. Narsingh Rao and another (referred supra),

wherein the Court considered the scope of interference by the

authorities under Section 9 of ROR Act, while exercising suo motu

power of revision and held as follows:

MSM,J WP_16458_2021

―To sum up, delayed exercise of revisional jurisdiction is frowned upon because if actions or transactions were to remain forever open to challenge, it will mean avoidable and endless uncertainty in human affairs, which is not the policy of law. Because, even when there is no period of limitation prescribed for exercise of such powers, the intervening delay, may have led to creation of third party rights, that cannot be trampled by a belated exercise of a discretionary power especially when no cogent explanation for the delay is in sight. Rule of law it is said must run closely with the rule of life. Even in cases where the orders sought to be revised are fraudulent, the exercise of power must be within a reasonable period of the discovery of fraud. Simply describing an act or transaction to be fraudulent will not extend the time for its correction to infinity; for otherwise the exercise of revisional power would itself be tantamount to a fraud upon the statute that vests such power in an authority.‖

Following the above judgment, learned single Judge of

Telangana High Court in S. Surendhar Reddy v. State of

Telangana, rep. by its Principal Secretary, Revenue Department,

Hyderabad5 held that, when there is no semblance of explanation for

inordinate delay and latches and the prayer, if accepted, will result

in upsetting settled position dating back the year 1960. In the facts

of the above judgment, the delay was about 60 years in prosecuting

the grievance and there is inordinate and unexplained delay in

prosecuting such grievance. The Court held that, exercise of suo

motu power of revision under Section 9 of ROR Act is illegal and set-

aside the same.

Inordinate delay would cause serious prejudice to the parties

whose name is recorded in the revenue records, as there is a

possibility of entering into several transactions and such

transactions cannot be trampled unsettling the rights in immovable

property. Undoubtedly, entries in revenue records do not create any

title or confer any right on the person whose name is entered in the

revenue records. However, it is a presumptive title under Section 6 of

ROR Act. Till such presumption is rebutted, the person whose name

2021 (5) ALT 49 (TS) MSM,J WP_16458_2021

is entered in the revenue record is presumed to be a rightful owner of

the property. Therefore, such mutation by itself would not unsettle

the possession. However, in view of the presumption under Section 6

of ROR Act, there is a possibility of creating third party rights. In

those circumstances, exercise of suo motu power by the second

respondent on the ground of illegality is irregular.

Whereas the respondent in support of his contention

contended that, when a serious fraud or illegality is committed in

mutation, the authorities can exercise such power at any time.

Learned Assistant Government Pleader for Revenue placed

reliance on the judgment of the Apex Court in A.V. Papayya Sastry

v. Government of Andhra Pradesh (referred supra), where the

Supreme Court held that, such power of revision under Section 9 of

ROR Act can be exercised at any stage, more particularly, when the

entries were made in the revenue records by playing fraud. In the

facts of the above judgment, the Apex Court limited its discussion on

the powers of Collector under Section 9 to exercise suo motu power.

In Indian Bank v. Satyam Fibres (India) Pvt. Ltd6, referring

to Lazarus Estates and Smith v. East Elloe Rural District

Council7: the Apex Court held as follows:

"The judiciary in India also possesses inherent power, specially under Section 151 C.P.C., to recall its judgment or order if it is obtained by Fraud on Court. In the case of fraud on a party to the suit or proceedings, the Court may direct the affected party to file a separate suit for setting aside the Decree obtained by fraud. Inherent powers are powers which are resident in all courts, especially of superior jurisdiction. These powers spring not from legislation but from the nature and the Constitution of the Tribunals or Courts themselves so as to enable them to maintain their dignity, secure obedience to its process and rules, protect its officers from indignity and wrong and to punish unseemly behaviour. This power is necessary for the orderly administration of the Court's business".

(1996) 5 SCC 550

(1956) 1 All ER 855 MSM,J WP_16458_2021

In United India Insurance Co. Ltd. v. Rajendra Singh & Ors8

by practising fraud upon the Insurance Company, the claimant

obtained an award of compensation from the Motor Accident Claims

Tribunal. On coming to know of fraud, the Insurance Company

applied for recalling of the award. The Tribunal, however, dismissed

the petition on the ground that it had no power to review its own

award. The High Court confirmed the order. The Company

approached this Court. Allowing the appeal and setting aside the

orders, this Court stated:

"Itis unrealistic to expect the appellant company to resist a claim at the first instance on the basis of the fraud because appellant company had at that stage no knowledge about the fraud allegedly played by the claimants. If the Insurance Company comes to know of any dubious concoction having been made with the sinister object of extracting a claim for compensation, and if by that time the award was already passed, it would not be possible for the company to file a statutory appeal against the award. Not only because of bar of limitation to file the appeal but the consideration of the appeal even if the delay could be condoned, would be limited to the issues formulated from the pleadings made till then.

Thus, the Apex Court concluded that, fraud vitiates everything

and the order obtained from the competent authority or tribunal.

Therefore, the authority under Section 9 of Act can exercise such suo

motu power to revise the orders passed by the competent authority.

Here, it is not the case of fraud, but it is a case of illegality. That can

be traced from the allegations made in the notice. The competent

authority under the Act did not specify any other grounds to exercise

such power, whereas, fraud and illegality are totally different and

distinct. The judgments of the Apex Court in Joint Collector, Ranga

Reddy District v. D. Narsingh Rao and another (referred supra)

and A.V. Papayya Sastry v. Government of Andhra Pradesh

(2000) 3 SCC 581 MSM,J WP_16458_2021

(referred supra) are judgments of Division Bench consisting of Two

Judges, but, the judgment of the Apex Court in M/s. D.N. Roy v.

State of Bihar (referred supra) is of three Judges and it will have

presidential value over the judgments of Division Benches. Further,

the judgment of A.V. Papayya Sastry v. Government of Andhra

Pradesh (referred supra) is directly relating to Section 9 of ROR Act,

whereas, judgment of M/s. D.N. Roy v. State of Bihar (referred

supra) is relating to exercise of suo motu power by the Central

Government under Mineral Concession Rules, 1960. In view of the

language employed in Section 9 of the Act, the principle laid down by

the Full Bench of the Apex Court in M/s. D.N. Roy v. State of Bihar

(referred supra) is applicable to the present facts of the case.

Applying the said principle to the present facts and circumstances of

the case, notice to show cause as to why suo motu proceedings

should not be initiated is required to be issued before initiating

exercise of such power under Section 9 of ROR Act by the second

respondent.

In the instant case, no such show cause notice was issued

before initiating revision proceedings by exercising suo motu power

of revision under Section 9 of ROR Act, but served notice after

initiating revision proceedings, exercising power under Section 9 of

ROR Act. Therefore, the impugned notice issued to this petitioner

calling upon him to appear before the second respondent on

17.07.2021 at 11:00 A.M is contrary to the principle laid down in

M/s. D.N. Roy v. State of Bihar (referred supra). Hence, the notice

impugned in this writ petition is illegal, arbitrary and contrary to the

principle laid down by the Full Bench of the Apex Court in M/s. D.N.

Roy v. State of Bihar (referred supra), though it is in consonance MSM,J WP_16458_2021

with Section 9 of ROR Act. Hence, the notice impugned in this writ

petition i.e. Rc.No.2203/2021-D5 dated 09.07.2021 is declared as

illegal, arbitrary and contrary to the principle laid down by the Full

Bench of the Apex Court in M/s. D.N. Roy v. State of Bihar

(referred supra) and set-aside the same, while permitting the second

respondent to follow the directions issued in M/s. D.N. Roy v. State

of Bihar (referred supra) issue show cause notice prior to initiation

of proceedings, exercising power of suo motu revision under Section

9 of ROR Act and take appropriate action.

In the result, writ petition is allowed, declaring the notice in

Rc.No.2203/2021-D5 dated 09.07.2021 as illegal, arbitrary and

contrary to the principle laid down by the Full Bench of the Apex

Court in M/s. D.N. Roy v. State of Bihar (referred supra) and set-

aside the same, while permitting the second respondent to follow the

directions issued in M/s. D.N. Roy v. State of Bihar (referred supra)

to issue show cause notice prior to initiation of proceedings,

exercising power of suo motu revision under Section 9 of ROR Act

and take appropriate action. This order will not preclude the second

respondent to take appropriate action, in accordance with law, by

following the law laid down by the Full Bench of the Apex Court in

M/s. D.N. Roy v. State of Bihar (referred supra). No costs.

Consequently, miscellaneous applications, pending if any,

shall also stand closed.

__________________________________________ JUSTICE M. SATYANARAYANA MURTHY Date:08.10.2021

SP