Saturday, 14 May 2016

What is term “entitled to defend” and its connection with principles of natural justice?

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 
2015 (3) SCALE 39 referred
to Hari Vishnu Kamath v. Ahmad Ishaque and
 Ors.AIR 1955 SC 233
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.
Reportable
IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
CIVIL APPEAL NO. 6774 of 2015
(@ SLP(C) NO. 16650 OF 2012)
Poonam
 V
State of U.P. & Ors
Citation;(2016) 2 SCC779
Dipak Misra, J.
Dated;October 29, 2015

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 thePage 2
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
5
th 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
2Page 3
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
3Page 4
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
others1
 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.
1
2008 (1) ADJ 718
4Page 5
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
5Page 6
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
6Page 7
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
7Page 8
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
5
th 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
8Page 9
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, exarmy
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
9Page 10
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
10Page 11
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
11Page 12
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
12Page 13
of Revenue, Bihar and another2 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 others3
 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)
2 AIR 1963 SC 786
3
(2012) 7 SCC 610
4
(2006) 8 SCC 129
13Page 14
“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 Bisht5
this Court while dealing with the concept of
necessary parties and the effect of nonimpleadment
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 Revenue6
, 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 Gujarat7
,
Babubhai Muljibhai Patel v. Nandlal Khodidas
Barot8
 and Sarguja Transport Service v. STAT9
.)
10. In Prabodh Verma v. State of U.P.10 and
Tridip Kumar Dingal v. State of W.B.11, it has been
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
14Page 15
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 Pandey12 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
12 2015 (3) SCALE 39
13 AIR 1955 SC 233

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 Others14 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
14 (1974) 4 SCC 335

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,
18Page 19
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 nonjoinder
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 Pradesh15
,
J.S. Sachdev and Ors. v. Reserve Bank of India, New
Delhi16 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 Others18 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 Rahim19 and the other in Padamraj v. State of
Bihar20
. The Court distinguished both the decisions by
holding thus:-
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
19Page 20
“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 India21 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 Others22 is quite
pertinent. The Division Bench referred to the decision in
All India SC & ST Employees’ Assn. v. A. Arthur Jeen23
wherein this court had addressed the necessity in joining
21 (1983) 3 SCC 601
22 (2008) 4 SCC 619
23 (2001) 6 SCC 380
20Page 21
the necessary candidates as parties. The Court referred to
the principle of natural justice as enunciated in Canara
Bank v. Debasis Das24
. 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
24 (2003) 4 SCC 557
21Page 22
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. & Anr25 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
25 (2011) 6 SCC 570
22Page 23
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
23Page 24
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
24Page 25
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:-
25Page 26
“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. Govindappa26.)
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.”
26 (2009) 1 SCC 1
26Page 27
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 Kaur27
, Sangam Spinners v. Regl. Provident
Fund Commr.28, and Railway Board v. C.R.
Rangadhamaiah29 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) ***
27 (2008) 12 SCC 112
28 (2008) 1 SCC 391
29 (1997) 6 SCC 623
27Page 28
(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
28Page 29
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.
29Page 30
28. We shall deal with the authorities in seriatim. A threejudge
Bench decision in Prabodh Verma and Others v.
State of Uttar Pradesh and Others30 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
30 (1984) 4 SCC 251
30Page 31
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.”
31Page 32
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
32Page 33
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 others31
, 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.”
31 1995 Supp (1) SCC 179
33Page 34
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 Others32 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
32 (2009) 1 SCC 768
34Page 35
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
35Page 36
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
36Page 37
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
37Page 38
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
38Page 39
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:-
39Page 40
“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 Others33
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
33 (2010) 10 SCC 408
40Page 41
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
41Page 42
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:-
42Page 43
“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
43Page 44
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.
44Page 45
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 Others34 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 vio-
34 (2010) 12 SCC 204
45Page 46
lation 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 Barot35 and Sarguja
Transport Service v. STAT36.)
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
35 (1974) 2 SCC 706
36 (1987) 1 SCC 5
46Page 47
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.
47Page 48
40. In this regard, we may refer to the rule stated by Lord
Halsbury in Quinn v. Leathem37:-
“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 others38 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 case39 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
37 (1901) AC 495, p. 506
38 (1996) 6 SCC 44
39 1993 Supp (2) SCC 149
48Page 49
(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
49Page 50
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
50Page 51
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
51Page 52
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
52Page 53
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
53Page 54
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
54Page 55
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.
40 (1995) 2 SCC 326
55Page 56
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 199942 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
41 (2011) 2 SCC 54
42 Decided on 12.04.1999
56Page 57
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
57Page 58
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
58Page 59
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
59Page 60
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
43 (1999) 1 SCC 738
60Page 61
Greater Bombay & Ors.44 would be fruitful. The twoJudge
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
44 (1992) 2 SCC 524
61Page 62
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 Begum45 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.,
45 AIR 1958 SC 886
62Page 63
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 England47, 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 ques-
46 (1954) 1 All ER 273
47 (1950) 2 All ER 605, 611
63Page 64
tion 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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