M/S Shiva Stone Crusher vs Ut Of J&K & Ors
2021 Latest Caselaw 603 j&K

                                                           Sr. No.114
                                                          Before Notice
       IN THE HIGH COURT OF JAMMU AND KASHMIR
                      AT JAMMU

                    (THROUGH VIRTUAL MODE)

                           WP(C)No.930/2021
                            CM(3898/2021)
                            CM(3899/2021)

M/S SHIVA STONE CRUSHER                               ...PETITIONER(S)

          Through: Mr. Parag Sharma, Advocate.

                                   Vs.
UT of J&K & Ors.                                   ....RESPONDENT(S)

Through: Mr. F. A. Natnoo, AAG.

CORAM: HON'BLE MR. JUSTICE SANJEEV KUMAR, JUDGE

(ORDER)(ORAL) 04.06.2021 CM No.3899/2021 Instant application seeking extension of time for annexing/

depositing the requisite court fee etc. with the writ petition, in view of

the grounds urged therein, is allowed. The petitioner shall deposit the

requisite court fee with the Registry of this Court within a period of one

week from the date Registry resumes normal functioning.

WP(C) No.930/2021 CM No.3898/2021

1. Petitioner is a stone crushing unit owned by one Shri Sunil

Bharti and is aggrieved of an order of District Mineral Officer, Geology

& Mining Department, Jammu, the respondent No.3, issued vide his

No.DMO/J/Illegal-Extraction/2021-22/466-69 dated 27th of April,

2021, whereby a fresh penalty to the tune of Rs.951280/ has been imposed. The petitioner has also sought a direction to respondent No.1

to 3 to allow him to operate his stone crusher in view of S.O. 60 dated

23rd of February, 2021, whereby the Jammu and Kashmir Stone

Crushers/Hot and Wet Mixing Plants Regulation Rules, 2021, have

been promulgated.

2. Learned counsel for the petitioner at the outset would submit that

the second relief prayed in the writ petition has been rendered

infructuous in view of the respondents having permitted the petitioner

to operate his stone crusher as per the provisions of S.O. 60 of 23 rd

February, 2021. He, however, would assail the impugned order of

penalty, primarily, on the ground that for the same offence, the

petitioner has been vexed twice which is not permissible in law. It is

submitted that with regard to the same omission/offence earlier also, a

penalty of Rs.2255000/ has been imposed by the respondents, which is

subject matter of appeal before the Appellate Authority.

3. It is argued by Mr. Sharma, learned counsel for the petitioner,

that assuming though not admitting that the respondents are entitled in

law to issue the fresh order of penalty on the basis of actual

consumption of electricity in the petitioner unit, yet no such order could

have been passed by the respondents without affording an opportunity

of being heard to the petitioner.

4. It is the grievance of the petitioner that by issuing the impugned

order of penalty, the petitioner has been condemned unheard and, therefore, the impugned order falls foul of Article 14 of the

Constitution of India.

5. Mr. F. A. Natnoo, learned AAG, appearing for the respondents,

has filed objections and has contradicted the position projected by Mr.

Sharma. He would submit that fresh penalty has been imposed on the

basis of fresh material. It is sought to be clarified that the earlier

penalty was imposed on the basis of a report submitted by a Committee

constituted by the Divisional Commissioner, Jammu, whereas the

impugned order of fresh penalty has been passed on the basis of actual

consumption of electricity by the petitioner unit. It is submitted that the

record of the Power Development Department shows that a huge

amount of electricity was consumed even during the period the unit

was sealed and non-operational. It is, however, not disputed by Mr.

Natnoo that before issuing the impugned order, no opportunity of being

heard was ever given to the petitioner.

6. Having heard learned counsel for the parties and perused the

record, I am of the considered view that the order impugned visits the

petitioner with serious civil consequences and the same could not have

been passed without complying with the principle of audi alteram

partem.

7. After the judgment of A.K.Kraipak v. Union of India. (1969) 2

SCC 262, a thin line of distinction between an administrative power

and a quasi judicial power is virtually obliterated. In paragraph 20 of

A. K. Kraipak (supra), the Supreme Court held thus:-

"20. The aim of the rules of natural justice is to secure justice or to put it negatively to prevent miscarriage of justice. These rules can operate only in areas not covered by any law validly made. In other words they do not supplant the law of the land but supplement it. 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: (1) no one shall be a judge in his own case (Nemo debet esse judex propria causa) and (2) 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 added to the rules of natural justice. Till very recently it was the opinion of the courts that unless the authority concerned was required by the law under which it functioned to act judicially there was no room for the application of the rules of natural justice. The validity of that limitation is now questioned. If the purpose of the rules of natural justice is to prevent miscarriage of justice, one fails to see why those rules should be made inapplicable to administrative enquiries. Often times it is not easy to draw the line that demarcates administrative enquiries from quasi-judicial enquiries. Enquiries which were considered administrative at one time are now being considered as quasi- judicial in character. Arriving at a just decision is the aim of both quasi-judicial enquiries as well as administrative enquiries. An unjust decision in an administrative enquiry may have far more reaching effect than a decision in a quasi-judicial enquiry. What particular rule of natural justice should apply to a given case must depend to a great extent on the facts and circumstances of that case, the framework of the law under which the enquiry is held and the constitution of the Tribunal or body of persons appointed for that purpose. Whenever a complaint is made before a court that some principle of natural justice had been contravened the court has to decide whether the observance of that rule was necessary for a just decision on the facts of that case."

8. The principles of natural justice have been designed to ensure

fairness in action by the State and public bodies and, therefore, an important facet of Article 14 of the Constitution of India. One of the

principles of natural justice i.e. the principle of audi alteram partem

has been explained by the Supreme Court in numerous judgments

handed down by the Supreme Court from time to time. Mohinder

Singh Gill v. Election Commission of India, (1978) 1 SCC 405,

Smt. Maneka Gandhi v. Union of India, AIR 1978 SC 597 and

Swadeshi Cotton Mills v. Union of India, AIR 1981 SC 818, Union

of India v. Tulsiram Patel, (1985) 3 SCC 398 to cite the few.

9. In paragraph No.95 and 96 of Tulsiram Patel (supra), the

Supreme Court beautifully concertized law on the subject, which for

facility of reference are reproduced hereunder.

"95. The principles of natural justice have thus come to be recognized as being a part of the guarantee contained in Article 14 because of the new and dynamic interpretation given by this Court to the concept of equality which is the subject-matter of that Article. Shortly put, the syllogism runs thus violation of a rule of natural justice results in arbitrariness which is the same as discrimination; where discrimination is the result of state action, it is a violation of Article 14: therefore, a violation of a principle of natural justice by a State action is a violation of Article 14. Article 14, however, is not the sole repository of the principles of natural justice. What it does is to guarantee that any law or State action violating them will be struck down. The principles of natural justice, however, apply not only to legislation and State action but also where any tribunal, authority or body men, not coming within the definition of "State" in Article 12, is charged with the duty of deciding a matter. In such a case, the principles of natural justice require that it must decide such matter fairly and impartially.

The rule of natural justice with which we are concerned in these Appeals and Writ Petitions, namely, the audi alteram partem rule, in its fullest amplitude means that a person against whom an order to his prejudice may be passed should be informed of the allegations and charges against him, be given an opportunity of submitting his explanation thereto, have the right to know the evidence, both oral or documentary, by which the matter is proposed to be decided against him, and to inspect the documents which are relied upon for the purpose of being used against him, to have the witnesses who are to give evidence against him examined in his presence and have the right to cross-examine them, and to lead his own evidence, both oral and documentary, in his defence. The process of a fair hearing need not, however, conform to the judicial process in a court of law, because judicial adjudication of causes involves a number of technical rules of procedure and evidence which are unnecessary and not required for the purpose of a fair hearing within the meaning of audi alteram partem rule in a quasi-judicial or administrative inquiry. If we look at clause (2) of Article 311 in the light of what is stated above, it will be apparent that clause is merely an express statement of the audi alteram partem rule which is implicitly made part of the guarantee contained in Article 14 as a result of the interpretation placed upon that Article by recent decisions of this Court. Clauses (2) of Article 311 requires that before a government servant is dismissed, removed or reduced in rank, an inquiry must be held in which he is informed of the charges against him and given a reasonable opportunity of being heard in respect of those charges. The nature of the hearing to be given to a government servant under clauses (2) of Article 311 has been elaborately set out by this Court in Khem chand's case in the passages from the judgment extracted above. Though that case related to the original clause (2) of Article 311, the same applies to the present clause (2) of Article 311 except for the fact that now a government servant has no right to make any representation against the penalty proposed to be imposed upon him but, as pointed out earlier, in the case of Suresh Koshy George v. The University of Kerala and others, such an opportunity is not the requirement of the principles of natural justice and as held in Associated Cement Companies Ltd. v. T. C. Shrivastava and others neither the ordinary law of the land nor industrial law requires such an opportunity to be given. The Opportunity of showing cause against the proposed penalty was only the result of the interpretation placed by the Judicial Committee of the Privy Council in Lall's Case upon section 240(3) of the Government of India, 1935, which was accepted by this Court in Khem Chand's Case. If, therefore, an inquiry held against a government servant under clause (2) of Article 311 is unfair or biased or has been conducted in such a manner as not to give him a fair or reasonable opportunity to defend himself, undoubtedly, the principles of natural justice would be violated, but in such a case the order of dismissal, removal or reduction in rank would be held to be bad as contravening the express provisions of clause (2) of Article 311 and there will be no scope for having recourse to Article 14 for the purpose of invalidating it."

10. From the aforesaid enunciation of law, it is trite that the

principles of natural justice constitute basic element of fair hearing

having their roots in the innate sense of man for fair play and justice.

The audi alteram partem rule in its complete sense would mean that a

person against whom an order to his prejudice may be passed should be

informed of the allegation and charges against him, be given adequate

opportunity of submitting his explanation thereto both oral and

documentary, and shall have the right to know the material by which

the matter is proposed to be decided against him. Any action by the

State or a public body which visits a person with civil consequences is

to be taken in compliance with the principles of audi alteram partem.

It is true that audi alteram partem rule is not rigid and inflexible

principle to be applied in all situations. As rightly observed in

Tulsiram Patel (supra) that they are not cast in a rigid mould nor can

they be put in a legal straight jacket. They do not apply in the same

manner to two situations, which are not alike. Their applicability can be

excluded by express words of statute or by necessary intendment. Similarly, in the case of Smt. Maneka Gandhi (supra), it has been

observed that even where there is no specific provision for showing

cause, yet in a proposed action which affects the right of an individual,

it is duty of the authority to give reasonable opportunity of being heard.

This duty is said to be implied to nature of functions to be performed

by authorities having power to take punitive or damaging action.

11. Delhi Transport Corporation v. DTC Mazdoor Congress,

1991 Supp. (1) SCC 600, is another Constitution Bench judgment,

which throws considerable light on the observance of principles of

natural justice in particular audi alteram partem rule. In the aforesaid

case, it has been held that the audi alteram partem rule, which, in

essence, enforces the equity clause of Article 14 of the Constitution, is

applicable not only to quasi judicial orders but to administrative orders

affecting prejudicially the party in question unless application of rule

has been expressly excluded by Act or regulation or rule. The rule of

principles of natural justice does not supplant but supplement the rules

and regulations and it is the demand of the rule of law, which

permeates our constitution that the rule is observed both substantially

and procedurally. It is, thus, trite that any action prejudicial to a citizen,

which is taken by the State or public authority without affording him an

opportunity of being heard would be unfair and arbitrary. An action

which is unfair and arbitrary would fall foul of rule of equality, which

is soul and spirit of Article 14 of the Constitution. It is only in

exceptional cases like where there is no prejudice caused to a person against whom an order is passed or the compliance of principles of

natural justice particularly the rule of audi alteram partem, even if

observed would not change the position and would be a mere useless

formality, its strict adherence is excluded.

12. Recently the Supreme Court in the case of State of U.P. v.

Sudhir Kumar Singh, 2020 SCC Online SC 847 elaborately dealt

with the scope and applicability of audi alteram partem rule. Hon'ble

the Supreme Court after surveying the entire case law, in paragraph

No.39 held thus:-

"39. An analysis of the aforesaid judgments thus reveals:

(1) Natural justice is a flexible tool in the hands of the judiciary to reach out in fit cases to remedy injustice. The breach of the audi alteram partem rule cannot by itself, without more, lead to the conclusion that prejudice is thereby caused.

(2) Where procedural and/or substantive provisions of law embody the principles of natural justice, their infraction per se does not lead to invalidity of the orders passed. Here again, prejudice must be caused to the litigant, except in the case of a mandatory provision of law which is conceived not only in individual interest, but also in public interest.

(3) No prejudice is caused to the person complaining of the breach of natural justice where such person does not dispute the case against him or it. This can happen by reason of estoppel, acquiescence, waiver and by way of non-challenge or non-denial or admission of facts, in cases in which the Court finds on facts that no real prejudice can therefore be said to have been caused to the person complaining of the breach of natural justice.

(4) In cases where facts can be stated to be admitted or indisputable, and only one conclusion is possible, the Court does not pass futile orders of setting aside or remand when there is, in fact, no prejudice caused. This conclusion must be drawn by the Court on an appraisal of the facts of a case, and not by the authority who denies natural justice to a person.

(5) The "prejudice" exception must be more than a mere apprehension or even a reasonable suspicion of a litigant. It should exist as a matter of fact, or be based upon a definite inference of likelihood of prejudice flowing from the non-observance of natural justice.

13. Applying the aforesaid principles to the instant case, it is

abundantly clear that the imposition of huge penalty that too on the

basis of material not shared with the petitioner has resulted in serious

breach of audi alteram partem rule in its entirety. The petitioner has

been condemned unheard and the impugned order has visited him with

serious civil consequences. Had the respondents put the petitioner on

notice and supplied to him all the material relied upon for drawing the

order impugned, the petitioner would have got an opportunity to

explain, rebut or contradict the same. A serious prejudice has been

caused to the petitioner by denying them an opportunity of being heard

and by passing an ex-parte order. As is apparent from reading of the

averments made in the writ petition, the petitioner has set up a fairly

probable case in his defense but has been disabled to put it up before

the respondents because of unilateral and behind the back action of the

respondents. I have, therefore, no doubt in my mind that in the instant

case by not complying with the audi alterlam partem rule, the

respondents have caused serious prejudice to the petitioner and have acted in a manner, which is unfair and arbitrary and, therefore, violative

of Article 14 of the Constitution.

14. In the instant case, the respondents, based upon the input

received from the Power Development Department with regard to

actual consumption of electricity in the petitioner unit, unilaterally

came to the conclusion that the petitioner unit had indulged in illegal

activity of operating the stone crusher by using the material procured

through illegitimate sources. May be or may be not, it is true, however,

before coming to such conclusion, it was incumbent upon the authority

concerned to put the petitioner on notice and provide him an adequate

opportunity to explain his position vis-à-vis the consumption of

electricity in the unit. There ought to have been an enquiry in the matter

to ascertain true facts. All this has not been done and the respondent

No.3, of its own and without associating the petitioner, has worked out

huge penalty. The impugned order, which is passed in clear violation of

principle of natural justice, cannot be sustained in law.

15. Mr. Natnoo, learned AAG, appearing for the respondents, could

not justify a unilateral exparte order, as the impugned order is.

16. For all these reasons, I am inclined to accept the writ petition to

the extent aforesaid. The impugned order bearing No.DMO/J/Illegal-

Extraction/2021-22/466-69 dated 27th of April, 2021, is quashed,

leaving it open to the respondents to pass a fresh order only after

providing an adequate opportunity of being heard to the petitioner and

holding a proper enquiry into the matter. Needless to say that on being put on notice, the petitioner shall be entitled to raise all available pleas

in his defence including those elaborately pleaded in this writ petition.

(Sanjeev Kumar) Judge

Jammu;

04.06.2021 "Bhat Altaf, PS"

                   Whether the order is speaking:         Yes/No
                   Whether the order is reportable:       Yes/No