ABBREVIATION

1) AC «««««««««««««««.«.. Law Reports, Appeal Cases (Third Series) 2) AIR ««««««««««««««...«««««««««««.. All India Reporter 3) All. «««««««««««««««««««««««««««««.. Allahabad 4) Anr. ««««««««««««««««««««««««««««...«. Another 5) Bom. «««««««««««««««..««««««««««««««. Bombay 6) ch. «««««««««««««««««««««...«««««««««. Chapter 7) Co. «««««««««««««««««««.««««««««««.. Company 8) DLR ««««««««««««««««««««««..«. Dominion Law Reports 9) E.C.R. ««««««««««««««««.«««« European Commission Report 10) E.g. ««««««««««««««««««««««««««««...«. Example 11) ICR. ««««««««««««««««««««...««« Industrial Cases Reports 12) J. «««««...«««««««««««««««««««««««««« Justice 13) L Ed. «««««««««...« United States Supreme Court Reports, Lawyers' Edition 14) Mad. «««««««««««««««..«««««««««««.«««.. Madras 15) Ors. ««««««««««««««««««««««..««««««««.. Others 16) p. ««««««««««««««««««««««...««««««««.«.. Page 17) Pat. «««««««««««««««««««««««««««««««.. Patna 18) R. ««««««««««««««««««««««« The Reports in all the Courts 19) SC «««««««««««««««««««««««««..««.. Supreme Court 20) SCC «««««««««««««««««...««««««« Supreme Court Cases 21) Sec. «««««««««««««««««««««««««««..««« Section 22) Supp «««««««««««««««««««««««««..«... Supplementary 23) v. «««««««««««««««««««««««««««««««« versus 24) Vol. ««««««««««««««««««««««««««««««. Volume 25) W.L.R. ««««««««««««««««««««««...«. Weekly Law Reports

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LIST OF AUTHORITIES CASES 1) Steel Authority of India Limited v. S.T.O., (2008) 9 SCC 407 2) Union of India v. E. G. Nambudiri, AIR 1991 SC 1216 3) Glaxo Laboratories v. A. V. Venkateswaran, AIR 1959 Bom. 372 4) Mir Mohamed Bahauddin v. Mujee Bunnisa Begam, AIR 1952 Mad. 276 5) S.P. Gupta v. Union of India, 1981 Supp SCC 87 6) High School & I.E. Board v. Bagleshwar, AIR 1966 SC 875 7) Pradeep Singh v. Lucknow University, AIR 1983 All. 427 8) Kesava Mills Co. Ltd. and another vs. Union of India and others, AIR 1973 SC 389 9) Madhusudhan Paswan v. State, AIR 1989 Pat. 106 10) Ravi S Naik Sanjay Bandekar vs. Union of India AIR 1994 SC 1558 11) Som Datt Datta v. India, AIR 1969 SC 414 12) S.N. Mishra v. India, AIR 1980 SC 1984 13) Sardari Lal v. India, AIR 1987 SC 2016 14) Harinagar Sugar Mills Ltd. vs. Shyam Sunder Jhunjhunwala and others, AIR 1961 SC 1669 15) Bhagat Raja vs. Union of India and others, AIR 1967 SC 1606 16) M/s. Mahabir Prasad Santosh Kumar vs. State of U.P and others, AIR 1970 SC 1302 17) M/s. Woolcombers of India Ltd. vs. Woolcombers Workers Union and another, AIR 1973 SC 2758 18) Siemens Engineering and Manufacturing Co. of India Ltd. v. Union of India and another, AIR 1976 SC 1785 19) Maneka Gandhi v. Union of India, AIR 1978 SC 597 20) Gurdial Singh Fijji vs. State of Punjab and Ors., (1979) 2 SCC 368 21) Shri Swamiji of Shri Admar Mutt etc. etc. vs. The Commissioner, Hindu Religious and Charitable Endowments Dept. and Ors., AIR 1980 SC 1 22) Maharashtra State Board of Secondary and Higher Secondary Education vs. K.S. Gandhi, (1991) 2 SCC 716 23) Union of India v. Mohan Lal Capoor and others, AIR 1974 SC 87
2

24) M.L. Jaggi vs. Mahanagar Telephones Nigam Limited and others, (1996) 3 SCC 119 25) Chairman, Rani Lakshmi Bai Kshetriya Gramin Bank vs. Jagdish Sharan Varshney & Ors., (2009) 4 SCC 240 26) Sri Goutam Singha and others v. The Principal Secretary, Land & Land Reforms Department Govt. of West Bengal & Ors., W.P.L.R.T. 44 of 2010 27) M/S Kranti Asso. Pvt. Ltd. & Anr. v. Masood Ahmed Khan & Ors., (2010) 9 SCC 496 28) Padfield v. Minister of Agriculture, Fisheries and Food (1968), [1968] AC 997 29) Alexander Machinery (Dudley) Ltd. v. Crabtree, [1974] ICR 120 30) R v. Secretary of State for Trade and Industry ex parte Lonrho (1989), [1989] 1 W.L.R. 525 31) R v, Minister of Housing and Local Government exparte Chichester RDC, [1960] 1 W.L.R. 587 32) Pure Spring Co. Ltd. v. Minister of National Revenue, [1947] 1 DLR 501 33) .D.R. Construction Ltd. And Rent Review Commission, [1983] 139 DLR 168 34) Re Yarmouth Housing Ltd. And Rent Review Commission, [1983] 139 DLR (3d) 544 35) Phelps Dodge Corporation v. National Labour Relations Board, [1940] 85 L Ed. 1271 36) Securities and Exchange Commission v. Chenery Corporation, [1942] 87 L Ed. 626 37) Beus (5/67) [1968] E.C.R. 83 38) Germany v. Commission (24/62) [1963 E.C.R. 63 39) Meroni v. High Authority (9/56) [1958] E.C.R. 133 40) Wachauf v. Germany (5/88) [1989] E.C.R. 2609

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RESEARCH METHODOLOGY

AIMS AND OBJECTIVES

This project aims to secure an understanding of the law relating to Reasoned Decision and its scope in India. This is sought to be achieved by looking into past decisions of Indian Judiciary on the matter and the existing statutes and their operations in other nations.

SCOPE OF THE PROJECT

The scope of the project is limited to the various case laws, precedents and observations made by eminent jurist. The existence of Reasoned Decision in India has been examined in the light of judicial treatment given to them in various pronouncements. Also, the Provisions relating to Reasoned Decision in various foreign constitution and statutes has been dealt with the help of judicial rulings.

MODE OF CITATION

A uniform mode of citation has been followed throughout the project.

SOURCES

Sources include basically books on Administrative law, case law reporters, and case law journals.

4

INTRODUCTION

"Reason is heart beat of every conclusion. It introduces clarity and without the same, it becomes lifeless.´1 Transparency is a hallmark of any good administrative body and a trait cherished by a democratic country like ours. The ongoing practice in all nations governed by rule of law and constitutional governance is to give reasons for its decision and is the life blood of any judicial action. But the most pertinent question is about the legal position when there are no statutory obligations to give reasons. Does the principle of public law require that reasons should be given for administrative action? The principle of giving a reasoned decision has slowly taken its root as one of the principles of natural justice. The doctrine of giving reasons has been incorporated in our judiciary in the Code of Civil Procedure. But the same principle is yet to be codified in case of decisions given by Administrative bodies and other such tribunals. The 14th Law Commission has recommended for a statutory provision for giving reasons in judicial and quasi-judicial acts of Administration but the Parliament is still to act on it. Also, it has been increasingly realized that for good governance reasons need to be given and omission might lead to injustice. Procedural laws ensure fair decision making. They do not contain any guarantee of fair laws or fair rules. Unless the laws are fair and are fairly implemented, there cannot be justice in the true sense. And procedural safeguards do not necessarily ensure a fair outcome. Thus, to safeguard the interest of the concerned persons, the administrative tribunals and other similar bodies must apply the principles incorporated in the principle of natural justice in a balanced way according to the circumstances of each case. The considerable body of case law indicates that this is not always easy or obvious. Also, the increasing burden on the already overinflated courts in India can be considerably reduced if our tribunals give intelligible and adequate reasons for their decisions. It may protect the courts from unjustified challenges, because those adversely affected are more likely to accept a decision if they know why it has been taken. A reasoned decision will not only reduce the burden of the court but also fulfill the reason for its establishment i.e. imparting justice. A decision backed by reason is a reflection of application of mind and reduces the possibility of mindless and arbitrary action by the administrative authority.
1

Steel Authority of India Limited v. S.T.O, (2008) 9 SCC 407

5

The principle of audi alteram partem is the basic concept of principle of natural justice which means that every person must be given an opportunity to defend himself. Principles of µfair hearing¶ are recognized as being indispensable in all judicial proceedings. These are the standards of fairness that must be followed when a judicial or administrative authority is entrusted with the function of determining the rights and liabilities of parties in a lis before it. The principle of natural justice has twin ingredients; firstly, the person who is likely to be adversely affected by the action of the authorities should be given notice to show cause thereof and granted an opportunity of hearing and secondly, the orders so passed by the authorities should give reason for arriving at any conclusion showing proper application of mind. Violation of either of them could in the given facts and circumstances of the case, vitiate the order itself. Such rule being applicable to the administrative authorities certainly requires that the judgment of the Court should meet with this requirement with higher degree of satisfaction. The order of an administrative authority may not provide reasons like a judgment but the order must be supported by the reasons of rationality. The only requirement of this principle is that the order must entail a reason which should be adequate and rational. If there is an error on the face of the decision but it is backed by reason, it can be challenged and corrected by the appellate authority. The appellate authority, then on the basis of the reasons given, will be able to adjudicate on the matter in a better manner than when there were no reasons because he will be able to identify the lis and correct in a better manner. In cases where the appellate authority is satisfied with the decision and reasons given by the tribunal all it has to do is to state that it concurs with the decision of the tribunal while giving no further reason. But where he comes to the conclusion that the tribunal has erred and gives a contrary decision, they proper reasons need to be laid down. The mandate of giving reasons or passing a reasoned order or giving a reasoned decision is not only a part of natural justice but it is a safeguard against arbitrariness. When an adjudicator is obliged to give his reasons for conclusions, it will make it necessary for him to consider the matter carefully. The compulsion to give reasons introduces clarity in the order and minimizes chances of irrelevant considerations from entering a decisional process. In fact, recording of reasons ensures that the authority has applied its mind to the case and the reasons that compelled the authority to take a decision in question are germane to the contents and scope of power

6

vested in the authority. Therefore, in the absence of a speaking order, Courts would not be able to understand the application of mind to the facts and issues raised in the case Giving reasons is also a self-disciplining exercise. Decisions are more likely to be correct if they are carefully considered and properly articulated. Writing brings clarity and precision to thought. Reasons also provide a check on arbitrary decision-making. They avoid allegations of maladministration. There is also the factor that, in the absence of reasons, if all other known facts and circumstances appear to point overwhelmingly in favor of a different decision, the court will draw the inference that the decision-maker had no good reason for the decision.

7

NEED TO GIVE REASONS

Reasons are the link between the order and mind of the maker. Any decision of the administrative authority affecting the rights of the people without assigning any reason tantamount to violation of principles of natural justice. The requirement of stating the reasons cannot be under emphasized as its serves the following purpose: 1. It ensures that the administrative authority will apply its mind and objectively look at the facts and evidence of the case. 2. It ensures that all the relevant factors have been considered and that the irrelevant factors have been left out. 3. It satisfies the aggrieved party in the sense that his view point¶s have been examined and considered prior to reaching a conclusion and not arbitrary in nature. 4. The appellate authorities and courts are in a better position to consider the appeals on the question of law. In Union of India v. E. G. Nambudiri2, the court has stressed that ³right to reason is an indispensable part of a sound system of judicial review. Under our Constitution an administrative decision is subject to judicial review if it affects the right of the citizen.´3 The High Court of Bombay in the case of Glaxo Laboratories v. A. V. Venkateswaran4 held that, µwhen a law confers a right of appeal, the Legislature intends that that right should be an effective right and that right can only be an effective right if the officer or the authority from whose order an appeal lies gives reasons for his decision. It is only then that the appellate Court can properly discharge its function.´5 5. To demonstrate good practice and compliance with International standards. In short, reasons reveal the rational nexus between the facts considered and the conclusions reached. However, mere recording of reasons serves no purpose unless the same are communicated either orally or in writing to the parties. In fact mere communication of reasons has no meaning unless the corrective machinery is in place.
2 3 4 5

AIR 1991 SC 1216 Ibid, at 1219 AIR 1959 Bom. 372 Ibid, at 380

8

REASONED DECISION IN INDIA

In 1952, Subba Rao J. as a pusine judge of the Madras High Court articulated: ³From the standpoint of fair name of the tribunals and also in the interest if the public, they should be expected to give reasons when they set aside an order of an inferior tribunal. If reasons for an order are given, there will be less scope for arbitrary exercise of powers and the order µex facie¶ will indicate whether extraneous circumstances were taken into consideration by the tribunal in passing the order. The public should not be deprives of this only safeguard, unless the Legislature expressed otherwise. The order of a tribunal exercising judicial functions should ex facie show reasons in a succinct form for setting aside the orders of the subordinate tribunals.´6 While the common law rule that there is no general duty to give reasons still remains intact, in India the situation is quite different. The courts in India have shown a great deal of activism. The Principle of Natural Justice demands that the adjudicatory body give reasons for their decisions have been incorporated in administrative law thereby making it obligatory for the administrative authorities and tribunals to give reasons for their decisions. The courts have also imposed duty to give reason by linking the provision the provision of reasons to fairness itself. The court will consider the nature of the decision-maker, the context in which it operates and whether the provision reason is required on the grounds of fairness.

Though there is no statutory provision in the Indian Constitution like the one in South Africa (Chapter 2 of the Constitution of Republic of South Africa incorporate Bill of Rights and Article 33(2) provides that µeveryone whose rights have been affected by administrative action has the right to be given written reasons.¶), the obligation to give reasons has been given a constitutional sanction by the Supreme Court of India in its landmark decision in S.P. Gupta v. Union of India.7In this case, the court deduced the citizen¶s right to know and the right to obtain information from the constitutional guarantee of free speech and from the concept of open government inherent in a democratic system. Accordingly, it is the constitutional obligation of the authorities and adjudicators to disclose reasons for their orders.
6 7

Mir Mohamed Bahauddin v. Mujee Bunnisa Begam, AIR 1952 Mad. 276 at 280 1981 Supp SCC 87

9

I.

ADEQUATE REASON

The reasons should be recorded in proper spirit and mere pretence of it would not satisfy the requirements of law.8A mere repetition of the statutory language in the order does not make the order a reasoned one. A reason such as the ³entire examination of the year 1982 is cancelled´ cannot be regarded as adequate. This statement only speaks about the punishment without stating the reason or cause thereof.9 At times the courts show some flexibility in favour of an administrative order, depending upon the facts, even though the reasons may be scrappy. The only requirement in these circumstances is that the report should indicate application of mind by the concerned authority. In High School & I.E. Board v. Bagleshwar10, it was held that that the enquiry committee did not write an elaborate report but it did not mean that it did not consider all the relevant material before it before coming to the conclusion that the student had used unfair means. The question of sufficiency of reasons in a particular case remains uncertain. The nature and elaboration of reasons depends upon the facts of the case. The Supreme Court has stated that it is not necessary for the authority to ³write out a judgment as courts of law are supposed to do. However, at least ³outline of process´ of reasoning must be given. It seems that it will satisfy the requirement of ³giving reasons´ if relevant reasons have been given for the order, though the authority has not set out all the reasons or some of the reasons which were argued before the court have not been expressly considered by the authority.11

II.

NON SPEAKING ORDER

The expression `speaking order' was first coined by Lord Chancellor Earl Cairns in a rather strange context. The Lord Chancellor, while explaining the ambit of Writ of Certiorari, referred to orders with errors on the face of the record and pointed out that an order with errors on its face

8 9

AIR 1990 SC 1984. Jain. Cases. Ch IX, Sec. G, 776 Pradeep Singh v. Lucknow University, AIR 1983 All. 427 AIR 1966 SC 875 Jain. Administrative Law. 372.

10 11

10

is a speaking order.12 Principle of speaking order it is the heart and soul of every judicial and administrative order so that the party may know the reasons which otherwise comes under the domain of right to reason. Under ordinary conditions, a non speaking order given by a tribunal should be declared null and void as it violates the principle of natural justice and the constitutional sanction laid down by the Supreme Court in various cases. But, it has been seen in a few cases that the courts make compromise and avoid at time times to declare a non-speaking order invalid. In case of Tripathi13, even when reasons were not stated, the Supreme Court sustained the order of dismissal of an employee by a statutory corporation. The court instead stated that the reason was implicit in the order. Also, in the case of Ranganath v. Daulatrao14, the court refused to intervene where the authority passed an order adversely affecting the individual on the ground that the matter did not involve adjudication of facts but rested on the point of law about which there was no error according to the court.15 But in Madhusudan16, the court taking a different view quashed a non-speaking order cancelling the examination of a candidate.

III.

CONSTITUTIONAL PROVISIONS

Under Article 311(2) (b), when a person is being dismissed without an enquiry, reasons are to be recorded by the disciplinary authority for not holding the inquiry. It has been held that of such reasons are not recorded the order dispensing with the enquiry would be void. But the communication of these reasons to the civil servant is not obligatory, though it is desirable to do so with a view to avoiding an allegation that the reasons were concocted later on.17 Asking for reasons ensures that decisions are not just ipse dixit of the decision maker. It is in this context that Article 14 of the Constitution must also be looked at because Article 14 has been interpreted
12

1878-97. Vol. 4 Appeal Cases 30 at 40 of the report; Kesava Mills Co. Ltd. and another vs. Union of India and

others, AIR 1973 SC 389
13 14 15 16 17

AIR 1984 SC 274 AIR 1975 SC 2146 Jain, Cases, p. 690 Madhusudhan Paswan v. State, AIR 1989 Pat. 106 Sardari Lal v. India, AIR 1987 SC 2016; Tulsiram Patel, Ch. IX, note 228

11

as a protection against arbitrary action. Right to information and right to be informed about a reason of any decision is within the domain of Article 19(1) read with Article 21 of the Constitution of Indian terms of the views expressed by the Apex Court in the case Ravi S Naik Sanjay Bandekar vs. Union of India.18

IV.

RELEVANT CASE LAWS

The Constitutional Bench of Supreme Court in the case of Som Datt Datta v. India19, took a restrictive view. This case basically related to Army Act. Mr. Justice Ramaswami delivering the judgment for the unanimous Constitution Bench held that ³provisions of Sections 164 and 165 of the Army Act do not require an order confirming proceedings of Court Martial to be supported by reasons. Apart from any requirement imposed by the statute or statutory rule either expressly or by necessary implication, there is no legal obligation that the statutory tribunal should give reasons for its decision for its decision. There is also no general principle or any rule of natural justice that a statutory tribunal should always and in every case give reasons in support of its decision´ The Court held that an order confirming such proceedings does not become illegal if it does not record reasons. Instead of confining itself to the present Act made a sweeping judgment regarding giving decisions and somehow tried to introduce English Common Law position with regards to giving of reason20 in India. In a landmark case of S.N. Mishra v. India21, the Supreme Court asserted again the importance of giving reason. It stated that ³the requirement that the reasons be recorded should govern the decisions of an administrative authority exercising quasi-judicial functions irrespective of the fact whether the decision is subject to appeal, revision or judicial review.´ But in the same case the unanimous Constitution Bench speaking through Justice S.C. Agrawal confirmed its earlier decision in Som Datt in para 47 at page 2000 of the report and held reasons are not required to be recorded for an order confirming the finding and sentence recorded by the Court Martial.
18 19 20 21

AIR 1994 SC 1558. AIR 1969 SC 414 Page 6 AIR 1980 SC 1984

12

Time and again, the need to give reasons has been emphasized by the Supreme Court. Reasoned decision in India can be traced back to the case of Harinagar Sugar Mills Ltd. vs. Shyam Sunder Jhunjhunwala and others22where even though the decision was administrative in nature, the Court insisted on the requirement of recording reason and further held that in exercising appellate powers, the Central Government acted as a tribunal in exercising judicial powers of the State and such exercise is subject to Article 136 jurisdiction of this Court. Such powers, this Court held, cannot be effectively exercised if reasons are not given by the Central Government in support of the order. In the case of Bhagat Raja vs. Union of India and others23, the Constitution Bench of this Court examined the question whether the Central Government was bound to pass a speaking order while dismissing a revision and confirming the order of the State Government. The Court insisted on reasons being given for the order when the State Government gives a number of reasons some of which are good and some are not, and the Central Government merely endorses the order. In M/s. Mahabir Prasad Santosh Kumar vs. State of U.P and others24, while dealing with U.P. Sugar Dealers License Order under which the license was cancelled, the Supreme Court held that such an order of cancellation is quasi-judicial and must be a speaking one. The Court further held that merely giving an opportunity of hearing is not enough and further pointed out where the order is subject to appeal, the necessity to record reason is even greater. In M/s. Woolcombers of India Ltd. vs. Woolcombers Workers Union and another25, the Court while considering an award under Section 11 of Industrial Disputes Act insisted on the need of giving reasons in support of conclusions in the Award. The Court held that the very requirement of giving reason is to prevent unfairness or arbitrariness in reaching conclusions. The second principle is based on the jurisprudential doctrine that justice should not only be done, it should also appear to be done as well. The learned Judges said that a just but unreasoned conclusion does not appear to be just to those who read the same.

22 23 24 25

AIR 1961 SC 1669 AIR 1967 SC 1606 AIR 1970 SC 1302 AIR 1973 SC 2758

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In Siemens Engineering and Manufacturing Co. of India Ltd. v. Union of India and another26, the court held that the rule requiring reasons in support of a quasi- judicial order is as basic as following the principles of natural justice. And the rule must be observed in its proper spirit. A mere pretence of compliance would not satisfy the requirement of law. One of the most important decisions to come up in this principle of reasoned decision in India is probably Maneka Gandhi v. Union of India27. In this particular case, the authorities under section 10(5) of the Passport Act need to record reasons and furnish a copy of the same to the concerned individual but the reasons for impounding can be refused on the grounds that it was not in the interest of the general public and the same was applied on her. The order was challenged in the Supreme Court. The court looking at the reasons given by the authority ruled that the authority cannot by itself be the final authority to determine the question of non-disclosure of reasons in particular cases in public interest. Bhagwati, J., stressed that ³giving of reasons is a healthy check against abuse or misuse of power as the order impounding the passport can be quashed if the reasons for doing so are extraneous or irrelevant. The court would be very slow in accepting the claim of the passport authority that it would not be in public interest to disclose the reasons. The authority would have to satisfy the Court by placing relevant material giving reasons which would be ³clearly and indubitably´ against the interest of the general public. If the court is not so satisfied it would require the authority to disclose the reasons. Maneka thus represents the high watermark of judicial insistence on adjudicatory authorities to give reasons for their decisions.´ In Gurdial Singh Fijji vs. State of Punjab and Ors.28, this Court, dealing with a service matter, relying on the ratio in Capoor29, held that "rubber-stamp reason" is not enough and virtually quoted the observation in Capoor to the extent that reasons "are the links between the materials on which certain conclusions are based and the actual conclusions."

26 27 28 29

AIR 1976 SC 1785 AIR 1978 SC 597 (1979) 2 SCC 368 Union of India v. Mohan Lal Capoor and others, AIR 1974 SC 87

14

In a Constitution Bench decision of this Court in Shri Swamiji of Shri Admar Mutt etc. etc. vs. The Commissioner, Hindu Religious and Charitable Endowments Dept. and Ors.,30while giving the majority judgment Chief Justice Y.V. Chandrachud referred to Broom's Legal Maxims 31 "Ces-sante Ratione Legis Cessat Ipsa Lex.´ The English version of the said principle given by the Chief Justice is that "reason is the soul of the law, and when the reason of any particular law ceases, so does the law itself." In Maharashtra State Board of Secondary and Higher Secondary Education vs. K.S. Gandhi32 and others, the Court held that even in domestic enquiry if the facts are not in dispute nonrecording of reason may not be violative of the principles of natural justice but where facts are disputed necessarily the authority or the enquiry officer, on consideration of the materials on record, should record reasons in support of the conclusion reached. In the case of M.L. Jaggi vs. Mahanagar Telephones Nigam Limited and others33, the Court dealt with an award under Section 7 of the Telegraph Act and held that since the said award affects public interest, reasons must be recorded in the award. In the case Chairman, Rani Lakshmi Bai Kshetriya Gramin Bank vs. Jagdish Sharan Varshney & Ors.,
34

the Court held that "reason must be given by the appellate or revisional

authority even when affirming the impugned decision". The Supreme Court in its decision in Sri Goutam Singha and others v. The Principal Secretary, Land & Land Reforms Department Govt. of West Bengal & Ors.35 and M/S Kranti Asso. Pvt. Ltd. & Anr. vs Masood Ahmed Khan & Ors.36, has again highlighted the importance of giving reasons while passing a judgment / order by any judicial or quasi judicial body.

30 31 32 33 34 35 36

AIR 1980 SC 1 Broom's Legal Maxims, 1939 Edition, p. 97 (1991) 2 SCC 716 (1996) 3 SCC 119 (2009) 4 SCC 240 W.P.L.R.T. 44 of 2010 (2010) 9 SCC 496

15

REASONED DECISION AND STATUTORY PROVISONS

A) REASONS: COMMON LAW I. ENGLAND

Common law owes to Franks Committee report for statutory implementation of duty to give reasons.37 The recommendations given by the Franks Committee were enacted in the Tribunals and Inquiry Act 195838, which requires the tribunals listed in the Act to give a statement, written or oral, of the reasons for a decision, if requested by the individual and it also applies to ministerial decision subsequent to statutory enquiries. Along with this Act, other primary and secondary legislation imposes a duty to give reasons in specific conditions.39 Where the Lord Chancellor and the Secretary of State after consultation with Council of Tribunals, feel that giving of reasons for certain decisions taken by tribunals and ministers is µunnecessary and impractical¶, an order may be made excluding the duty to give reasons in these cases.40 In Padfield v. Minister of Agriculture, Fisheries and Food (1968)41 the House of Lords said that an absence of reasons could raise an inference of no good reason opening the decision up to judicial review. In Alexander Machinery (Dudley) Ltd. v. Crabtree42 Sir John Donaldson, as President of the National Industrial Relations Court, has observed that: ³Failure to give reasons amounts to a denial of justice.´ But, the limitations of this principle were rigorously stated by Lord Keith in R v. Secretary of State for Trade and Industry ex parte Lonrho (1989)43 as follows: ³The absence of reasons for a decision where there is no duty to give them cannot of itself provides any support for suggested irrationality of the decision. The only significance is that if all other known facts and circumstances appear to point overwhelmingly in favour of a different decision, the decision maker cannot complain if the court draws the inference that he has no rational for his decision.´
37 38 39 40 41 42 43

Craig, Paul. Administrative Law. Thomson, Sweet and Maxwell. 2008, 6th edition. p402 Tribunal and Inquiry Act, 1958, s. 12(1), repealed by the Tribunals and Inquiry Act, 1992, sec. 10 E.g. R v, Minister of Housing and Local Government exparte Chichester RDC, [1960] 1 W.L.R. 587 Act of 1971, section 12(6) [1968] AC 997 [1974] ICR 120 [1989] 1 W.L.R. 525

16

But, it has been seen in England that there is a duty to give reason where a right of appeal is provided. A reasoned decision is necessary to enable the person prejudicially affected by the decision to know whether he has a ground of appeal; it will also assist the appellate court to scrutinize effectively the decision for relevant error, without necessarily usurping the function of the tribunal«´ 44 Thus, we can see that in England, there is no automatic duty on the tribunal to give reasons; the obligation to do so only arises when parties to the dispute demand reasons.

II.

CANADA

Statutory Powers and Procedure Act, 1980 provides that "a tribunal shall give its final decision, if any, in any proceedings in writing and shall give reasons in writing therefore if requested by a party. This position existing in Canada is very much similar to that of England. In Pure Spring Co. Ltd. v. Minister of National Revenue45 it was held that when a Minister makes a determination in his discretion he is not required by law to give any reasons for such a determination but in some recent decisions, however, the Courts have recognized that in certain situations there would be an implied duty to state the reasons or grounds for a decision.46

III.

AUSTRALIA

Section 13 of Commonwealth Administrative Decisions (Judicial Review) Act, 1977 enables a person who is entitled to apply for review of the decision before the Federal Court to request the decision-maker to furnish him with a statement in writing setting out the findings on material questions of fact, referring to the evidence or other material on which those findings were based and giving the reasons for the decision and on such a request being made the decision-maker has to prepare the statement and furnish it to the persons who made the request as soon as practicable and in any event within 28 days. The provisions of this Act are not applicable to the classes of decisions mentioned in Schedule I to the Act. A similar duty to give reasons has also been

44 45 46

De Smith, Woolf and Jowell, op cit, note 4, at 460 [1947] 1 DLR 501 Re R.D.R. Construction Ltd. And Rent Review Commission [1983] 139 DLR 168; Re Yarmouth Housing Ltd. And

Rent Review Commission [1983] 139 DLR (3d) 544

17

imposed by Sections 28 and 37 of the Commonwealth Administrative Appeals Tribunal Act, 1975. B) REASONS: UNITED STATES OF AMERICA The Federal Administrative Procedure Act, 1946 prescribes for the basic procedural principles which are to govern formal administrative procedures (Section 8(b)) to the effect that all decisions shall indicate a statement of findings and conclusions as well as reasons or basis therefore upon all the material issues of fact, law or discretion presented on the record. This principle is also incorporated in section 557(c) of the Administrative Procedure Act In Phelps Dodge Corporation v. National Labour Relations Board47 the court has insisted upon recording of reasons for its decision by an administrative authority on the premise that the authority should give clear indication that it has exercised the discretion with which it has been empowered because "administrative process will best be vindicated by clarity in its exercise.´ The said requirement of recording of reasons has also been justified in Securities and Exchange Commission v. Chenery Corporation
48

, on the basis that such a decision is subject to judicial

review and "the Courts cannot exercise their duty of review unless they are advised of the considerations underlying the action under review" and that "the orderly functioning of the process of review requires that the grounds upon which the administrative agency acted be clearly disclosed and adequately sustained."

C) REASONS: EUROPEAN COMMISSION In EC law there is a duty to give reasons based on article 253 EC. Like the common law, even under EC law the extent to which reasons have to be give depends upon the nature of the relevant act and the context within which it was made.49 This duty to give reasons is principally imposed upon the community organs themselves, but it can be applied to national authorities where they are acting as agents of the Community for the application of EC law.50

47 48 49

[1940] 85 L Ed. 1271 [1942] 87 L Ed. 626 Craig, n.202; Beus (5/67) [1968] E.C.R. 83; Germany v. Commission (24/62) [1963 E.C.R. 63; Meroni v. High

Authority (9/56) [1958] E.C.R. 133
50

Wachauf v. Germany (5/88) [1989] E.C.R. 2609

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CONCLUSION

In practice, many tribunals are function in our country but very few of them have, however, been able to inspire confidence in public. The tribunals have shown a singular lack of competence and objectivity in determining disputes. Tribunals are supposed to serve as an alternative institution to the High Court and hence they must prove themselves to be a competent and expert mechanism with a judicial and objective approach and that can be done through giving a fair hearing. Fair hearing has been bequeathed to the Indian legal system by the British system of law. The basic import of the principle of fair hearing gives an opportunity to a person against whom an adverse action is proposed to be taken so that he may have an opportunity to show cause as why such an action should not be taken. According to Megaw J. ³the reasons should be proper, intelligible and adequate. The application of the first two of these presents no problem. If the reasons given are improper they will reveal some flaw in the decision-making process which will be open to challenge on some ground other than the failure to give reasons. If the reasons given are unintelligible, this will be equivalent to giving no reasons at all.´ Principle of speaking order is the heart and soul of every judicial and administrative order so that the party may know the reasons. It is a fundamental principle of the administration of justice that both parties should be heard before a decision to their rights is passed and equally fundamental principle is that an authority must give reasons for its decision or order. Principles of natural justice are peremptory norms of procedural fairness and the main objective of these principles is to ensure that the rights of the parties are maintained. The lack of statutory provisions somehow limits the scope of reasoned decision but the creativity shown by Indian judiciary has ensured that it is now mandatory for administrative tribunals to adhere to the principles of natural justice and give reasons for their decisions or face the consequence of having their judgments quashed. Therefore, for development of law, requirement of giving reasons for the decision is of the essence and is virtually a part of "due process".

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BIBLIOGRAPHY BOOKS 1. De, D J. Interpretation and enforcement of fundamental rights. Eastern Law house. New Delhi. 2000. 2. Democracy, human rights and the rule of law: essays in honour of Nani Palkhivala Iyer, Venkat. Butterworths India. Delhi. 2000. 3. Hawke, Neil. Introduction to Administrative Law. Universal book traders. Delhi. 1993 4. Jain, M P. Treatise on administrative law, Vol. 1 (chapters I to XIX) / Wadhwa and 5) Company. New Delhi. 2000. 5. Jain, M. P. Cases and materials on Indian administrative law. Vol. 1. Delhi. 2000 6. Wade, William. Forsyth, Christopher. Oxford University press. 7. De Smith. Woolf. Jowell. Judicial Review of Administrative Action: Mainwork and Supplement. Thomson, Sweet & Maxwell. 6th Edition.
8. Broom. Broom's Legal Maxims. 1939 Edition.

9. Craig, Paul. Administrative Law. Thomson, Sweet and Maxwell. 2008, 6th edition.

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