Module 3: Principles of Natural Justice

Concept of Natural Justice

The term natural justice has not been defined in any enactment, rules or regulations. Eminent Jurists and
Courts in England and India have defined and explained the concept of Natural Justice.
Natural justice is justice based on human values and good conscience following a just and fair procedure.
PNJ control all actions of public authorities by applying rules relating to reasonableness, good faith and justice,
equity and good conscience.
Natural justice is a part of public law which relates to administration of justice. These are indeed great
assurance of justice and fairness.

Growth of Concept of Natural Justice

The word ‘Natural Justice’ manifests justice according to one’s own conscience. It is derived from the Roman
Concept ‘jus - naturale’ and ‘Lex naturale’ which meant principle of natural law, natural justice, eternal law,
natural equity or good conscience.
Lord Evershed- “Natural Justice is the natural sense of what is right and wrong.”
 Rules of Natural Justice have developed with the growth of civilization.
 Divine Law or Natural Law to which all laws and actions must conform.
 Natural Justice implies fairness, reasonableness, equity, and equality. It is a concept of common law.
 Natural Justice represents higher procedural principles developed by Judges which every
administrative authority must follow in taking any decision adversely affecting the rights of a private
individual.
 Natural Justice is based substantially on natural ideals and values which are universal. Application of
PNJ can improve the quality of administrative decision, enforce rule of law and accountability in
administration and show respect for human dignity.
 The basis of the PNJ is Rule of Law.
 Earliest expression of ‘PNJ’ could be found in philosophical expressions of Roman jurists.
 In ancient days, the Greeks had accepted the principle that “no man should be condemned unheard”.
 NJ meant many things like Divine Law, jus gentium (law of nations) and common law of the nation.
 Indeed, from the legendary days of Adam and of Kautilya’s Arthashastra, the Rule of Law has had this
stamp of NJ which makes it social justice.
 The PNJ have enriched law and Constitutions the world over. (Preamble, Art.311, 14, 21- duty to act
fairly)

Definition
The Committee on Ministers’ powers- “There are certain cannons of judicial conduct to which all tribunals
and persons who have to give judicial or quasi-judicial decisions ought to conform. The principles on which
they rest are, we think, implicit in the rule of law. Their observance is demanded by our notional sense of
justice.”
Viscount Haldane- “Those whose duty it is to decide must act judicially. They must deal with the question
referred to them without bias and they must give to each of these parties the opportunity of adequately
presenting the case made. The decision must come to the spirit and with the sense of responsibility of a tribunal
whose duty it is to meet out justice.”
The US Supreme Court- “There is violation of due process whenever there is a breach of PNJ so rooted in the
traditions and conscience of our people as to be ranked as fundamental.”
De Smith- The term ‘natural justice’ expresses the close relationship between the common law and moral
principles and it has an impressive ancestry. It is also known as ‘substantial justice’, ‘fundamental justice’,
‘universal justice’ or ‘fair play in action’.
Object of Natural Justice
a. To secure justice.
b. To prevent miscarriage of justice.
c. To protect fundamental liberties and rights of subjects.
Against whom natural justice may be enforced
a) Formerly, courts had taken the view that the PNJ were inapplicable to administrative orders.
b) Wanchoo J.- “The compulsion of hearing before passing the order implied in the maxim ‘audi alteram
partem’ applies only to judicial and quasi - judicial proceedings.”
c) Lord Denning- “It is well settled that, a statutory body which is entrusted by statute with a discretion, must
act fairly. It doesn't matter whether its functions are described as judicial or quasi-judicial on the one hand, or
as administrative on the other hand.”

Rules of Natural Justice

Natural Justice: There are two rules of Natural Justice.
 The rule against bias (‘nemo bebet esse judex in propria causa’), or “no man shall be a judge in his
own case or cause”)
 The right to a fair hearing (‘audi alteram partem’) or "hear the other side").
a) Notice
b) Right to Hearing
The Rule Against Bias (nemo bebet esse judex in propria causa)
Based on three maxims:
a) No man shall be a judge in his own case or cause.
b) Justice should not only be done but manifestly and undoubtedly be seen to be done.
c) Judges, like Caesar’s wife should be above suspicion.
Types of Bias-
1. Personal Bias
Case Law: A.K. Kraipak v. UOI (AIR 1970 SC 150)-
In pursuance of the Indian Forest Service (Initial Recruitment) Regulation, 1966, framed under Rule 4(1) of
the Indian Forest Service (Recruitment) Rules made under the All India Services Act, 1951, a Special Selection
Board was constituted for selecting officers to the Indian Forest Service in the senior and junior scales from
officers serving in the forest department of the State of Jammu and Kashmir.
One of the members of the Board was the Chief Conservator of Forests of the State, as required by the
Regulations. He was a Conservator of forests appointed as Acting Chief Conservator superseding another
Conservator of Forests whose appeal to the State Government against his supersession was pending at the
time the selections by the Board were made.
In this case, Naquishband, who was the acting Chief Conservator of Forests, was a member of Selection Board
and was also a candidate for selection to All India cadre of the Forest Service. Though he did not take part in
the deliberations of the Board when his name was considered and approved, the SC held that ‘there was a real
likelihood of a bias for the mere presence of the candidate on the Selection Board may adversely influence the
selection of the other members’.
Case Law: Mineral Development Corporation Ltd. v. State of Bihar (AIR 1960 SC 468)-
The petitioners were granted mining licence for 99 years in 1947. But in 1953, The Secretary of Revenue
Board, sent a notice to the petitioners to show cause with in 15 days why their licence should not be cancelled
for violation of Sections 10, 12 and 14 of the Bihar Mica Act, 1947. The petitioners submitted a written reply
denying the allegations. Two years later, the Govt. of Bihar issued notification cancelling the licence under
Sec. 25(1) (c) of the Act.
The action of the Govt. was challenged on the ground of personal bias. The SC quashed the order of the Govt.
on the ground of personal bias.
Real Likelihood of Bias/ Reasonable Suspicion of Bias-
 Res Ipsa Loquitor – The thing speaks for itself.
 Lord Hewart C.J- “Nothing is to be done which creates even a suspicion that there has been an improper
interference with the course of justice.”
 Lord Denning- “Justice must be rooted in confidence; and confidence is destroyed when right minded
people go away thinking.”
Case Law: G.N. Nayak v. Goa University (2002) 2 SCC 712-
In this case, HOD, Marine Science Dept. appreciated the work of an Associate Professor (Reader) in his
confidential report. HOD also a member of the Departmental Promotion Committee to consider such Junior
Faculty along with others for promotion. The DPC recommended the Junior Faculty for promotion which was
challenged on the ground of personal bias actuated by an element of personal interest.
The object of scrutiny, in this case, is the selection of the appellant as Professor of Marine Science in the
University of Goa. The appellant's selection was challenged under Article 226 of the Constitution of India by
the respondent who was himself a candidate for selection to the post. The challenge was upheld by the High
Court.
The SC held that unless preference is unreasonable and is based on self-interest, it will not vitiate an
administrative decision.
2. Pecuniary Bias
Case Law: J. Mohapatra & Co. v. State of Orissa (AIR 1984 SC 1572)-
In the State of Orissa, there was no statutory rule or regulation prescribing the procedure for selection of books
for general reading to be kept in school and college libraries, except the State Government's periodical
administrative instructions in the form of resolutions constituting committees namely, an Assessment Sub-
Committee, a Distribution Sub-Committee and a Purchase Committee to which Government officials as well
as non-officials were appointed as members. The procedure followed was that each year the Member-
Secretary of the Purchase Committee would call upon publishers and authors by advertisements given in local
newspapers to submit books for consideration.
The Assessment Sub-Committee could then consider the books so submitted and thereafter recommend a list
of books which, according to it, were suitable for general reading by school and college students. The Purchase
Committee would consider the recommendations made by the Assessment Sub-Committee prepares a final
list and submit it for approval to the State Government which could reject any book out of the list so submitted
without giving any reason. The decision of the State Government regarding the assessment, selection purchase
and distribution of books was made final.
The selection of the books for the years 1980, 1981 and 1982 was made in this fashion.
The SC quashed the decision of the Textbooks' selection committee because some of its members were also
the authors of the books, which were considered for selection. The Court concluded that withdrawal of person
at the time of consideration of his books is not sufficient as the element of quid pro quo with other members
cannot be eliminated.
3. Bias as to Subject Matter
Case Law: Gullapalli Nageshwar Rao v. APSRTC (AIR 1959 SC 308)-
In this case the SC quashed the decision of the AP Govt. nationalising road transport, on the ground that the
Secretary of APSRTC who gave hearing was interested in the subject matter.
4. Departmental/ Institutional Bias
Case Law: Krishna Bus Service Pvt Ltd. v. State of Haryana (AIR 1985 SC 1651)-
By a notification dated March 16, 1973 called the Punjab Motor Vehicles (Haryana First Amendment) Act
Rules, 1973, the General Manager Haryana Roadways was conferred with the powers exercisable by a Deputy
Superintendent of Police by virtue of the addition of clause (d) in Rule 10:2 of the Punjab Motor Vehicles
Rules, 1940.
In this case, private bus operators had alleged that the Gen. Manager of Haryana Roadways who was rival in
business in the State couldn’t be expected to discharge his duties in a fair and reasonable manner and would
be too lenient in inspecting the vehicles belonging to his own Dept.
The reason for quashing the notification according to the SC was the conflict b/w the duty and the interest of
the Dept. and consequential erosion of public confidence in administrative justice.
5. Policy Notion Bias
Case Law: T. Goivndraja Mudaliar v. State of T.N. (AIR 1973 SC 974)-
The T.N. Govt. decided in principle to nationalize road transport and appointed a committee to frame the
scheme. The Home Secretary was made a member of this committee. Later on, the scheme of nationalization
was finalized, published and objections were heard by the Home Secretary.
It was contended that the hearing was vitiated by the rule against bias because the Secretary already made up
his mind on the question of nationalization, as he was a member of the committee which took the policy
decision.
The SC rejected the challenge on the ground that the Secretary as member of the committee did not finally
determine any issue as to foreclose his mind. He simply helped the Govt. in framing the scheme.
6. Pre- conceived Notion Bias
Case Law: Kondala Rao v. APSRTC (AIR 1961 SC 82)-
In this case the SC didn’t quash the order of Minister, who had heard the objections of private operators,
nationalising road transport on the ground that the same Minister had presided over a meeting only a few days
earlier in which nationalisation was favoured.
The Court rejected the contention on the ground that the decision of the committee was not final and
irrevocable but merely a policy decision.
7. Bias on Account of Obstinacy
Case Law: A.U. Kureshi v. High Court of Gujarat (2009) 11 SCC 84-
The appellant was a Judicial Officer who joined the Gujarat Judicial Service in 1991 and was posted as Civil
Judge (Junior Division) at the District Court, Bharuch. The High Court of Gujarat (respondent) received a
complaint wherein it was alleged that a case bearing Criminal Case No. 2059/89 under the Gambling Act,
1867 was listed for hearing in the appellant's Court and that the appellant had acquitted the accused and also
returned the money seized from the accused from the scene of occurrence.
On the basis of this complaint the respondent issued a charge-sheet to the appellant and the appellant submitted
his reply.
A departmental inquiry was initiated against the appellant and the concerned Inquiry officer submitted his
report to the High Court of Gujarat stating that the charges levelled against the appellant had been proved.
On the basis of this report, a show-cause notice was issued to the appellant. The appellant filed his reply to
this show-cause notice. Dissatisfied with the appellant's reply, the High Court decided that it would be
appropriate to dismiss the appellant from service. By letter dated October 25, 2001, the High Court of Gujarat
recommended to the State Government that the appellant be dismissed from service and accordingly an order
was passed.
The appellant, being aggrieved, filed Special Civil Application No. 6164 of 2002 before the High Court of
Gujarat at Ahmedabad, which has been dismissed by the impugned order.
In this case one of the judges of the Gujarat HC considered the misconduct of a member of subordinate
judiciary on administrative side (disciplinary committee). He then decided the petition filed by the delinquent
officer on judicial side.
The SC held that there was reasonable apprehension of bias.
Prof. De Smith- “A real likelihood of bias means at least substantial possibility of bias.”
Prof. V. Williams- “Court will have to judge the matter as a reasonable man would judge any matter in the
conduct of his own business.”
Lord Hewart- “Real likelihood of bias depends not upon what actually was done but upon what might appear
to be done.”
Doctrine of Necessity- The term Doctrine of Necessity is a term used to describe the basis on which
administrative actions by administrative authority, which are designed to restore order, are found to be
constitutional. The maxim on which the doctrine is based originated in the writings of the medieval jurist
Henry de Bracton, and similar justifications for this kind of administrative action have been advanced by more
recent legal authorities, including William Blackstone.
Case Law: Ashok Kumar Yadav & Ors. v. State of Haryana (AIR 1987 SC 454)-
The question in this case was- Whether the selection of candidate would vitiate for bias if close relative of a
members of the Public Service Commission is appearing for selection?
The SC laid down the following propositions:
 Such member must withdraw altogether from the entire selection process otherwise all selection would
be vitiated on account of reasonable likelihood of bias affecting the process of selection.
 This is not applicable in case of Constitutional Authority like PSC whether Central or State. This is so
because if a member was to withdraw altogether from the selection process, no other person save a
member can be substituted in his place and it may sometimes happen that no other member is available
to take the place of such a member and the functioning of PSC may be affected.
 In such a case, it is desirable that the member must withdraw from participation in interview of such a
candidate and he should also not take part in the discussions.
The SC conceptualised the doctrine of necessity in this case.
The Right to a Fair Hearing (‘audi alteram partem’/ ‘hear the other side’)
This rule covers various stages through which administrative adjudication passes starting from notice to final
determination.
Right to fair hearing thus includes:
 Duty to act judicially or the duty to act fairly
Case Law: Keshav Mills Co. Ltd. v. UOI (1973)1 SCC 380)-
On 31st May 1969, Government of India passed an order appointing a Committee for investigation into the
affairs of the Company under the provisions of Sec 15 of the Industries (Development and Regulation) Act,
1951. In due course, the Investigating Committee completed its inquiry and submitted its report to the
Government.
On 24th November, 1970, the Government of India passed an Order under S. 18-A of the Act authorizing the
Gujarat State Textile Corporation to take over the management of the Company for a period of five years from
the date of publication of that order in the Official Gazette.
The takeover was challenged on the ground of violation of PNJ before HC which dismissed the petition.
The SC though didn’t interfere with the order on the ground that no prejudice was caused to the Mill Co. yet
observed: “The only essential that has to be kept in mind in all cases that the administrative authority
concerned should act fairly, impartially and reasonably.”
 Right to notice
Hear the other side or both the sides must be heard or one should not be condemned unheard. In other words,
No person accused of any charge or likely to suffer any civil consequences, must be adjudged unless and until
he is aware of the proceedings together with a notice thereon and an opportunity to present his case fully.
Case Law: Union of India v. Narendra Singh (2008) 2 SCC 750-
The respondent herein was working as Accountant in the Office of the Accountant General, Madhya Pradesh,
Branch Office, Bhopal. By an order dated January 1st 1990, he was mistakenly promoted as Senior Accountant
(Functional). After about four years, the Department realized that the promotion given to the respondent was
erroneous and he was not eligible to be promoted. The mistake was, therefore, sought to be corrected.
A notice under Rule 31-A of the Fundamental Rules, 1922 was issued to the respondent informing him that
he could not have been promoted as Senior Accountant as he had not passed Departmental Examination of
Accountants as required by law. He was, hence, asked to show cause why the promotion given to him
erroneously should not be cancelled.
By a reply dated February 16th 1994, the respondent contended that he was eligible and qualified for getting
promotion and accordingly he was promoted. He also asserted that he was performing his functions and
discharging his duties efficiently and there was no occasion to revert him. According to him, there was no
need to clear Departmental Examination for Accountants and the notice was required to be discharged.
After considering the reply submitted by the respondent, the Principal Accountant General, vide his order
dated March 29th 1994, cancelled the promotion. The respondent challenged the cancellation of promotion by
filing Original Application No. 275 of 1994 in the Tribunal. The Tribunal, on March 12th 1996, allowed the
petition and directed the Authorities to reconsider the case of the respondent.
The SC held that though the respondent is allowed to continue on the post of Senior Accountant (Functional)
till he reaches the age of retirement i.e. December 31st, 2007 and salary paid to him in that capacity will not
be recovered, his retiral benefits will be fixed not as Senior Accountant (Functional) but as Accountant.
  Right to know evidence against him
Case Law: Dhakeswari Cotton Mills Ltd. v. CIT(AIR 1955 SC 65)-
The appellant is a public limited joint stock company incorporated under the Indian Companies Act, 1915,
with its registered office at Calcutta. It carries on the business of manufacture and sale of cotton yarn and
piece-goods. On the 28th July, 1944, the Income-tax Officer issued a notice to it under section 22(2) of the
Indian Income-tax Act calling upon it to file the return of its income for the assessment year 1944-45 (account
year being 1943-44).
Before the expiry of the due date for filing the return the account books of the appellant company together
with the documents relevant to the accounts, were taken into custody by the Sub-Divisional Officer,
Narayanganj and it is alleged that these remained in the custody of the court of the Sub-Divisional Magistrate
till January, 1950, when they were handed back to the appellant.
In this situation the assessee pleaded for extension of time to furnish the return. This request was refused, and
a show- cause notice was issued under section 28(3) of the Act calling upon the appellant company why
penalty should not be imposed upon it for its failure to file the return.
The SC held that the assesse was not given a fair hearing. However, the supply of adverse material, unless the
law otherwise provides, in original form is not necessary. It is sufficient if the summary of the contents of
material is supplied, provided it is not misleading.
A person may be allowed to inspect the file and take notes. Whatever mode is used; the fundamental remains
the same that nothing should be used against the person which has not been brought to his notice.
 Right to present case and evidence/oral hearing
Case Law: R.B. Shreeram Durga Prasad v. Settlement Commission (IT&WT) (AIR 1989 SC 1038)
The appellant made a composite application under section 245C of the Income Tax Act, 1961 for settlement
of his assessments for the assessment years 1948-49 to 1975-76. The Commissioner objected to the proposals
under S. 336 and S. 245D(1) for settlement for the years 1948-49 to 1959-60, but agreed to the settlement for
the later years. The Commission accordingly made an order an 24th August, 1977 rejecting the application for
settlement for the years 1948-49 to 1959-60.
The appellant thereupon applied to the Commission to recall its order since the same had been made without
furnishing him any opportunity of hearing. That application was pending. When sub-section (IA) was inserted
to section 245D, the appellant applied to the Commission to permit him to contest the objections of the
Commissioner contending that these should be dealt with in accordance with the amended provisions of
section 245D(IA).
On 7th August, 1987 the Settlement Commission accepted the first part of the contentions holding that the
applicant was entitled to a re-hearing since its order of 24th August, 1977 had been made in violation of the
principles of natural justice and also express provision of section 245D(1) proviso, but rejected the second
part of the submission on the view that the application for settlement would have to be disposed of in
accordance with law which prevailed on24th August,1977. It further held that since the Commissioner had
objected only to some of the years under settlement the entire application would have to be rejected.
The SC held that mere opportunities to make submission is not enough but clear opportunity must be given to
demonstrate that the reporting authority wasn’t justified in making objections.
 Right to rebut adverse evidence
i. Right to cross examination
Case Law: Hira Nath Misra v. Principal, Rajendra Medical College (AIR 1973 SC 1260)-
This is an appeal by special leave by three students of Rajendra Medical College, Ranchi from an order of the
Patna High Court dated November 21, 1972 dismissing a Writ Petition filed by them for quashing the Order
dated 24-6-1972 passed by the Principal of that College expelling them from the college for two academic
sessions i.e. 1972-73 and 1973-74.
The appellants were Second Year students of the college and lived in a Hostel attached to the college. There
was another Hostel for girl students. On the night between 10th and 11th June, 1972 some male students of
the college were found sitting on the compound wall of the girls Hostel.
Later they entered into the compound and were seen walking without clothes of them. They went near the
windows of the rooms of some of the girls and tried to pull the hand of one of the girls. Some five of these
boys then climbed up along the drain pipes to the terrace of the girls Hostel where a few girls were doing their
studies. On seeing them the girls raised an alarm following which the students ran away. The girls recognized
four out of five this male students-three of them being the present appellants and the fourth being one Upendra
Prasad Singh.
The SC disallowed the opportunity of cross-examination on the grounds of practicability. The Court rejected
the contention of the appellants that they were not allowed to cross-examine the girl students on the ground
that if it was allowed no girl would come forward to give evidence, and further that it would not be possible
for the college authorities to protect the girl students outside the college precincts.
Where, however, witnesses depose orally before the authority, the refusal to allow cross-examination would
certainly amount to violation of principles of natural justice.
The right to cross-examine is an important part of the principle of fair hearing but whether the same should be
allowed in administrative matters mainly depends on the facts and circumstances of the case.
ii. Right to legal representation
Whether legal representation is allowed in administrative proceedings depends on the provisions of the statute.
Factory laws do not permit legal representation, Industrial Disputes Act allows it with the permission of the
tribunal and some statutes like Income Tax permit representation as a matter of right.
The courts in India have held that in following situations, some professional assistance must be given to the
party to make his right to defend himself meaningful:
a. Illiterate
b. Matter is technical or complicated
c. Expert evidence is on record
d. Question of law is involved
Case Law: Board of Trustees, Port of Bombay v. Dilip Kumar (AIR 1983 SC 109)-
In this case, in a charge sheet issued against the delinquent employee (respondent) for the misconduct alleged
against him the management appointed its legal officer and his assistant as presenting officers. At the same
time, it rejected the employee's request to engage a legal practitioner for his defence.
Meanwhile, as the enquiry was in progress, a Regulation 12(8) of Bombay Port Trust Employees Regulations
1976, came into force enabling a delinquent employee to engage a legal practitioner if the presenting officer
appointed by the disciplinary authority is a legal practitioner.
Even after the regulation came into force neither the enquiry officer nor the disciplinary authority reviewed
the earlier decision rejecting the delinquent's request to be represented by a legal practitioner. At the end of
the enquiry the respondent was dismissed from service.
The High Court set aside the order of dismissal on grounds of violation of principles of natural justice.
On the question whether, where in a domestic enquiry the employer appoints a legally trained person as
presenting-cum-prosecuting officer the enquiry would be vitiated for violation of principles of natural justice
if the employer rejected the delinquent's request for permission to defend him by a legal practitioner?
Dismissing the appeal, the SC held that since the delinquent employee had not been afforded a reasonable
opportunity to defend himself the enquiry is vitiated for violation of principles of natural justice.
 No evidence should be taken at the back of other party
Case Law: Hira Nath Misra v. Principal, Rajendra Medical College (AIR 1973 SC 1260)-
In this case the order of expulsion was challenged before the SC, and one of the grounds of challenging was
that the evidence was taken behind their backs.
The SC rejected the contention holding that the girls would not have ventured to make the statements in the
presence of the appellants except at a great risk of retaliation and harassment.
In this case, whatever evidence was collected behind backs of the appellants was brought to their notice and
they were provided with an opportunity to rebut the evidence. Every case has to be decided on its own merits.
 Report of the enquiry to be shown to the other party
Case Law: Keshav Mills Co. Ltd. v. UOI (AIR 1973 SC 389)-
Appellant Co. after doing business for 30 years closed down, due to this 1200 employees became unemployed.
On the basis of commission of enquiry into the affairs of the Co. u/s 15 of Industries (Development and
Regulation) Act,1951, in 1970 GOI passed an order u/s 18-A to take over the Mill by the Gujarat Textile
Corporation for a period of five years, which was challenged before the SC on the ground that enquiry report
was not submitted.
The SC Held that-
a. its not possible to lay down general principle on this question.
b. answer depends on facts and circumstances of each case.
c. if the non-disclosure of the report causes any prejudice in any manner to the party, it must be
disclosed, otherwise non-disclosure would not amount to violation of principles of natural justice.

 Reasoned decisions/speaking orders

A speaking order means an order speaking for itself. Every order must contain reasons in support of it. Giving
reasons in support of an order is considered tot be the third principle of natural justice. Thus, a party has a
right to know not only the result of the enquiry but also the reasons in support of the decision.
In India, unless there is specific requirement of giving reasons under the statute, it is not mandatory for the
administrative agencies to give reasons for their decisions.
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 viewpoints have been examined and considered
prior to reaching a conclusion.
 4. The appellate authorities and courts are in a better position to consider the appeals on the question of
law.
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.
Case Law: Tara Chand Khatri v. Municipal Corporation of Delhi (AIR 1977 SC 567)-
In this case, an assistant school teacher under the Delhi Municipal Corporation, was dismissed on the ground
of moral turpitude under the Delhi Municipal Corporation Act, 1957. The enquiry committee fully established
the charge. The Asst. Education Commissioner confirmed the report without giving reasons. The SC held that
where the disciplinary authority disagrees with the report of the enquiry officer, it must state the reasons.
 Institutional decision or who decides must hear
Case Law: Gullapalli Nageshwar Rao v. APSRTC (AIR 1959 SC 308)-
In this case the SC quashed the decision of the AP Govt. nationalising road transport, on the ground that the
Secretary of APSRTC who gave hearing was interested in the subject matter.
 Rule against dictation
Case Law: Orient Paper Mills Co. Ltd. v. UOI (AIR 1970 SC 1498)-
In this case up to February, 1961 certain "printing and writing paper" and “packing and wrapping paper"
produced by the appellant Company were subject to exercise duty at the rate of 22 nP. per kilogram though
the former was chargeable, under Item17(3) and the latter under Item 17(4) of the First Schedule to the Central
Excises and Salt Act, 1944.
The Finance Act of 1961 raised the, excise duty payable under Item 17(4) to 35nP. per kilogram with effect
from March 11 1968 and though for some months the Excise Officer continued to levy duty on certain
"machine glazed paper" popularly known as "M.G. Poster paper" under Item 17(3) i.e. by regarding it as
“printing and writing paper", subsequently the excise authorities began to treat this paper as "packing and
wrapping paper "and insisted on the appellant paying duty thereon under Item 17(4).
The appellant paid the duty at the rate claimed under protest and thereafter applied for refund of the excess on
the ground that the duty on that paper should have been levied under Item 17(3). The Assistant Collector
rejected the claim. An appeal to the Collector and a revision to the Central Government were also rejected.
It was clear from the order of the Collector as well as from the counter affidavit filed on behalf of the
Government that the appeal and the revision were rejected on the ground that the question was covered by a
direction issued by the Central Board of Revenue to the effect that the paper in question was to be treated as
packing and wrapping paper.
The SC quashed the order of the Dy. Superintendent levying excise duty on the directions of the Collector.
 Financial incapacity to attend the enquiry
Case Law: Mumtaz Hussain Ansari v. State of U.P. (AIR 1984 SC 1116)-
The appellant was employed as a Deputy Superintendent of Police (DSP) at Pilibhit, Lucknow, UP and
appellant was guilty of three of the four charges framed against him. Based on these charges the Tribunal and
HC upheld the dismissal order of the Govt.
The SC held ruled that if the applicant was under suspension for a long time and, hence, couldn’t deposit the
initial amount Rs.900 due to his financial incapacity, the failure not to summon to defence witnesses at the
Government’s expense was a violation of the PNJ, unless it was decided by the authority that the evidence of
such witnesses was not material.
  Decision post-haste (Administrative authority must not run rush decisions)
Case Law: City Corner v. Collector (AIR 1976 SC 143)-
In this case on 10th October, 1974, the appellant was granted a licence for conducting games of skill and
dances and other quality performances under the A.P. Places of Public Resort Act, 1888. Objections having
been raised, the Additional District Magistrate issued a show cause notice to the appellant. In reply the
appellant had asked for copies of certain documents on the basis of which the show cause notice had been
issued.
In the meantime, however the appellant submitted a tentative explanation stating that a detailed explanation
would be sent after the receipt of the copies of the documents. Immediately thereafter the District Magistrate
cancelled the licence on 28th January, 1975 on the ground that the explanation offered was a routine one and
was not convincing.
The SC held that the order passed post-haste without supplying copies of adverse material, or intimating that
the summary of documents already supplied was sufficient, offends the PNJ.
 Post- decisional hearing
Hear the other side or both the sides must be heard or one should not be condemned unheard. In other words,
no person accused of any charge or likely to suffer any civil consequences, must be adjudged unless and until
he is aware of the proceedings together with a notice thereon and an opportunity to present his case fully.
The idea of post- decisional hearing has been developed to maintain a balance between administrative
efficiency and fairness to the individual.
Case Law: Swadeshi Cotton Mills v. Union of India (AIR 1981 SC 818)-
The SC validated the order of the Govt. for taking over the management of the company which had been
passed in violation of the ‘audi alteram partem’ rule and which was found to have been attracted by necessary
implication because the Govt. had agreed to post-decisional hearing.
The ratio of the majority decision was as follows:
1. Pre-decisional hearing may be dispensed with in an emergent situation where immediate action is
required to prevent some imminent danger or injury or hazard to paramount public interest.
2. Mere urgency is, however, no reason for exclusion of ‘audi alteram partem’ rule. The decision to
exclude pre-decisional hearing would be justiciable.
3. Where pre-decisional hearing is dispensed with, there must be a provision for post-decisional remedial
hearing.
Case Law: K.I. Shephard & Ors v. Union of India (AIR 1987 SC 431)-
The Hindustan Commercial Bank, the Bank of Cochin Ltd. and Lakshmi Commercial Bank were amalgamated
with Punjab National Bank, Canara Bank, State Bank of India respectively in terms of separate schemes drawn
under Sec. 45 of the Banking Regulation Act,1949, and pursuant thereto 125 employees of these banks were
excluded from employment, and their services were not taken over by the respective transferee banks. Some
of these excluded employees filed writ petitions before the High Court which granted partial relief, but on
appeal by the transferee Bank the Writ Petitions were dismissed by the Division Bench.
The SC held that rules of natural justice apply to administrative action and the decision to exclude a section
of employees without complying with requirements of natural justice was bad.

Doctrine of Legitimate Expectation

Meaning
A person may have a LE of being treated in a certain way by an administrative authority even though he has
no legal right in private law to receive such treatment.
Prof. Wade: “LE means a reasonable expectation, can equally well be involved in any situations where fairness
and good administration justify the right to be heard.”
This doctrine has been developed both in the context of reasonableness and in the context of natural justice.
1. Legitimate expectation and natural justice-
Fair procedure and just treatment are the core of our jurisprudence. Hence, where the Govt. or an
instrumentality of State declares a policy, or holds out a promise, or makes a statement, or adopts a particular
code, the DLE operates.
2. LE and unreasonableness-
In administrative affairs of the country, the Govt. and its instrumentalities are expected to honour policy
statements without unfair discrimination to persons similarly situated. (Art.14)
3. LE and Public Policy-
It is open to the Govt. to frame and reframe its policy. If the policy is changed and the court does not find it
arbitrary, unreasonableness or otherwise objectionable, the DLE does not make a decision of the Govt.
vulnerable.
4. LE and Estoppel-
The element of acting to applicant’s detriment which is a sine qua non (an essential condition) for invoking
estoppel is not a necessary ingredient of legitimate expectation.
5. When it arises-
a. if there is express promise held out or representation made by a public authority;
b. because of the existence of past practice which the claimant can reasonably expect to continue;
c. such promise or representation is clear and unambiguous

6. Duty of applicant-
LE affords the applicant standing to apply for the judicial review. A person who bases his claim on the DLE
in the first instance, must prove that there is a foundation for such claim.
7. Duty of authority-
Where the applicant prima facie satisfies the court that his claim on the basis of LE is well founded, it is for
the authority to justify the action taken against the application.
8. Duty of court-
When a case of LE is made out by the applicant, the court will consider the prayer of the applicant for grant
of relief.
9. Scope of judicial review-
To qualify as a subject of judicial review, the decision impugned must have consequences which affect a
person or body of persons by depriving him of some benefit or advantage which affects a person or body of
persons by depriving him of some benefit or advantage.
Case Law: Schmidt & Anr. v. Secretary of State for Home Affairs (1969) 1 All ER 904)-
Two US students brought an action in the courts against the Home Secretary, U.K. They contended that they
were permitted to come into this country in order to study at the College of Scientology. Their permits were
for a limited time. The time has expired. They wished to complete their studies and asked the Home Secretary
to extend their permits but he refused. They argued that his refusal was invalid, because he did it for an
unauthorised purpose, and also because he did not act fairly towards them.
The Court observed that a foreigner who had been given leave to enter the United Kingdom, had the right to
be heard and had a legitimate expectation of being allowed to stay for the allowed time.
Case Laws: Attorney-General for Hong Kong v. Ng Yuen Shiu ((1983) 2 A.C. 629)-
A group of illegal immigrants of Chinese origin from Macau were told that each of them would be interviewed
in due course, and that each case would be treated on its merits. Three days later, a deportation order was
made against the claimant. He challenged it on the basis that he had a legitimate expectation of being heard
before a decision was taken.
The Court had observed that if a public authority has vowed to follow a procedure, it is imperative that it acts
in a fair manner and fulfills its promise, in the interest of good administration.
The Court distinguishes expectation from anticipation and states that an expectation can only be said to be
legitimate only if it has a legal sanctioning or is backed by a procedure or custom that has been followed
consistently.
Case Law: State of Kerala v. K.G. Madhavan Pillai ((1988) 4 SCC 669)-
The Doctrine of Legitimate Expectation was firstly discussed in the Indian arena in this case wherein a
sanction was issued under Kerala Education Act, 1957, for the respondents to open a new aided school and to
upgrade the existing schools, however, an Order was issued 15 days later to keep the previous sanction in
abeyance. This Order was challenged by the respondents in lieu of violation of principles of natural justice.
The Supreme Court ruled that the sanction had entitled the respondents with legitimate expectation and the
second order violated principles of natural justice.
Case Law: Navjyoti Coop. Group Housing Society v. Union of India (1992) 4 SCC 477-
In this case a new criterion for allotment of land was challenged. In the original policy, the seniority with
regards to allotment of land was decided on the basis of date of registration. Subsequently, a change in policy
was made in 1990, changing the criteria for deciding seniority based on the date of approval of the final list.
The Supreme Court held that the Housing Societies were entitled to ‘legitimate expectation’ owing to the
continuous and consistent practice in the past in matters of allotment. Court further elucidates on the principle
stating that presence of ‘legitimate expectations’ can have different outcomes and one such outcome is that
the authority should not fail ‘legitimate expectation’ unless there is some justifiable public policy reason for
the same.
It is further emphasized that availability of reasonable opportunity to those likely being affected by the change
in a policy which was consistent in nature is well within the ambit of acting fairly. The Court further held that
such an opportunity should have been given to the Housing Societies by way of a public notice.
Case Law: Food Corporation of India v. Kamdhenu Cattle Feed Industries (1993) 1 SCC 71)-
The appellant- Corporation invited tenders for sale of stocks of damaged food-grains. The respondent's bid
was the highest. Since the appellant was not satisfied about the adequacy of the amount offered even in the
highest tender, it invited all the tenders to participate in the negotiations, instead of accepting the highest
tender.
During the course of negotiations, the respondent refused to revise the rates in its offer. On the basis of the
highest bid made during the negotiations, the appellant disposed of the stocks of damaged food grains,
rejecting the highest tenders. The respondent, whose tender was the highest, challenged the decision of the
appellants by filing a Writ Petition before the High Court.
It was contended that the action of the appellant was arbitrary and hence violative of Art. 14 of the
Constitution. The High Court accepted the contention and allowed the Writ Petition. Being aggrieved by the
High Court's decision the appellant- Corporation preferred the present appeal.
It was contended on behalf of the appellant that there being no right in the person submitting the highest tender
to claim acceptance thereof, and since all tenderers were given equal opportunity to participate in the
negotiations and to revise the bid before acceptance, the action of the appellant was not arbitrary.
The respondent contended that since no cogent reasons were indicated for rejecting all the tenders and for
deciding to dispose of the stock by negotiating with the tenderers for procuring a higher price, such a decision
was arbitrary.
The Supreme Court held that the nature of the doctrine of legitimate expectations that the duty to act fairly on
part of public authorities, entitles every citizen to have legitimate expectation to be treated in a fair manner
and it is imperative to give due importance to such an expectation in order to satisfy the requirement of non-
arbitrariness in state action or otherwise it may amount to abuse of power.
The Court further made a remarkable point that such a reasonable or legitimate expectation may not be a
directly enforceable legal right but failure in taking it into account may deem a decision arbitrary. To decide
whether an expectation is a legitimate one is contextual and has to be decided on a case by case basis.
Limitations
1. The concept of LE is only procedural and has no substantive impact-
Case Law: AG for New South Wales v. Quinn (1990) 64 Aus. LJR 327-
Quinn was a stipendiary Magistrate in charge of Court of Petty Session. By an Act of Legislature that court
was replaced by Local Court. Though applied, Quinn was not appointed under the new system. The action
was challenged.
The High Court of Australia found in favour of the Attorney-General, ruling that Courts were not able to
overrule government policy as the appointment of magistrates is a role of the executive.
Brennan J held that "Judicial review provides no remedies to protect interests, falling short of enforceable
rights, which are apt to be affected by the lawful exercise of executive or administrative power" and that
"Judicial review has undoubtedly been invoked ... to set aside administrative acts and decisions which are
unjust or otherwise inappropriate, but only to the extent the purported exercise of power is excessive and or
otherwise unlawful.”
The Court dismissed the claim observing that if substantive protection is to be accorded to legitimate
expectations, it would result in interference with administrative decisions on merits which is not permissible.
2. The doctrine does not apply to legislative activities-
Case Law: Srinivasa Theatre v. Govt. of Tamil Nadu (AIR 1992 SC 999)-
The Tamil Nadu Entertainment Tax Act, 1939 provides for levy of entertainment tax on admission to cinema
theatres in the State of Tamil Nadu. Until 1978 the entertainment tax was levied on the basis of 'admission
system' i.e. on the actual number of tickets sold.
In 1978 the Act was amended and section 5(A) and 5(B) were introduced. These sections introduced the
‘composition system’ of collection of entertainment tax under which tax was levied based upon the gross
collection capacity of cinema theatres irrespective of the actual number of tickets sold.
In 1989 the Act was further amended and Sub-section (1) of Section 5(A) of the Act was substituted. By this
amendment, the percentage of entertainment tax via-a-vis the rates of admission in force in corporation and
special grade municipality areas was reduced from 53% to 40%.
At the same time all the theatres situated within the radius of five kilometers from the peripheral limits of such
areas (belt) which were hitherto governed by the composition system were brought over to the admission
system. However, the temporary and open air theatres even though located in the belt of five kilometers were
excluded from this switch-over.
The validity of the amendment was challenged inter alia on the ground that it was against legitimate
expectation of the law in force prior to amendment.
The SC rejected the argument and held that a legislation cannot be invalidated on the basis that it offends the
legitimate expectations of the persons affected thereby.
3. Doctrine of Legitimate Expectation does not apply if it is contrary to public policy or against the
security of the State
Case Law: Council of Civil Service Unions v. Minister for Civil Service (1984) 3 All ER 935-
The Government Communications Headquarters (GCHQ) is a British intelligence agency that provides signals
intelligence to the British government and armed forces. Prior to 1983, its existence was not acknowledged
although it openly recruited graduates. After a spy scandal in 1983, the organization became known to the
public, and Margaret Thatcher's government decided a year later that employees would not be allowed to join
a trade union for reasons of national security. The Minister for the Civil Service is a position held ex officio
by the Prime Minister.
That was done through an Order in Council, an exercise of the royal prerogative. Despite an extensive publicity
campaign by trade unions, the government refused to reverse its decision but instead offered affected
employees the choice between £1,000 and the membership of a staff association or dismissal. Employees
dismissed could not rely on an industrial tribunal since they were not covered by the relevant employment
legislation. As such, the Council of Civil Service Unions decided that judicial review was the only available
route.
The decision to ban workers at GCHQ from trade union membership had been taken after the meeting of a
select group of ministers and the prime minister, rather than the full Cabinet.
In the High Court, Glidewell J held that the employees of GCHQ had a right to consultation, and that the lack
of consultation made the decision invalid.
In the Court of Appeal, Lord Lane CJ, Watkins LJ and May LJ held that judicial review could not be used to
challenge the use of the royal prerogative. They decided that as the determination of national security issues
is an executive function, it would be inappropriate for the courts to intervene.
The House of Lords held, the royal prerogative was subject to judicial review, just like statutory instruments.
However, on national security grounds, the action of restricting the trade union was justified. Lords Fraser,
Scarman and Diplock all believed that the issue of national security was outside the remit of the courts.

Exceptions to Rules of Natural Justice

1. Emergency
Case Law: Swadeshi Cotton Mills v. Union of India (AIR 1981 SC 818)-
The appellant M/s. Swadeshi Cotton Mills was taken over by the Government of India by a notification dated
April 13, 1978 in exercise of the powers conferred on it under clause (a) of sub-section (1) of section 18AA
of the Industries (Development and Regulation) Act, 1951 on the ground that the company had by creation of
encumbrances on the assets of its industrial undertakings, brought about a situation which had affected and is
likely to further affect the production of articles manufactured or produced by it and that immediate action is
necessary to prevent such a situation.
The Government authorized the National Textile Corporation Limited to take over the management, subject
to the conditions that the authorized person shall comply with all the directions issued from time to time by
the Central Government and that the authorized person shall hold office for a period of five years.
The appellant Mills challenged the aforesaid order in a writ petition in the High Court which dismissed the
appeal.
The SC held that the word ‘immediate’ in Sec. 18-AA(1) of the Industries(Development and Regulation) Act,
1951 cannot stand in the way of the application of rules of NJ and the case is remitted to the Central
Government to give a full, fair and effective hearing.
2. Confidentiality
Case Law: Malak Singh v. State of Punjab and Haryana (AIR 1981 SC 760)-
The Appellants claimed that they were law-abiding citizens of Amritsar, but due to political enmity with a
Congress MLA, they had been falsely implicated in some criminal cases. Their names were entered in a
surveillance register with a police station in Amritsar, following which they would be harassed frequently by
being called to the police station or being involved in investigations without cause.
This petition originated from an appeal preferred against the judgment of the High Court of Punjab and
Haryana, which dismissed the writ petitions filed by the appellants, Malak Singh and Jaswant Singh who were
seeking the removal of their names from the surveillance register maintained with the police.
The surveillance register was maintained in accordance with Rule 23.4 of the Rules. Rule 23.7 further
prescribed that police surveillance would comprise of “close watch over the movements of the person under
surveillance, by Police Officers, Village headmen and village watchmen as may be applicable without any
illegal interference.
Issues:
 Whether a person was entitled to be given an opportunity to show cause before his name was included
in the surveillance register?
 Whether there existed a reasonable ground for the Appellants to be included in the surveillance
register?
The SC held that the maintenance of Surveillance Register by the Police is confidential document neither the
person whose name is entered in the Register nor the any other member of the public can have excess to it.
Furthermore, the Court observed that observance of the principles of Natural justice in such a situation may
defeat the very purpose of surveillance and there is every possibility of the end of justice being defeated instead
of being served.
3. Purely administrative matters
Case Law: Karnataka Public Service Commission v. B.M. Vijaya Shanker (1992)2 SCC 480)-
The Karnataka Public Service Commission conducted competitive examinations for the State Civil Services.
Clause (I) of the General Instructions to the candidates provided that the candidates should write their roll
number only on the front page of the answer books in the space provided for it and not anywhere else inside
the answer sheet.
Clause (xii) provided that the candidates must abide by the instructions and clause (xiii) provided that failure
to abide by the instructions will render them liable to expulsion from examination or such other punishment
as the Commission may deem fit.
Some of the candidates violated the instructions and entered their roll numbers inside the answer books.
Consequently, their answer books were not got evaluated by the Commission. The candidates challenged the
action of the Commission before the Karnataka Administrative Tribunal which directed the Commission to
get their answer books evaluated by holding that –
i. no penalty was provided for breach of the instructions and
ii. the failure of the Commission to afford any opportunity to the candidates to explain their bona fide
and innocence was arbitrary.
Against the decision of the Tribunal the Commission and the State filed appeals in the SC.
The SC held that rule of hearing has been construed strictly in academic disciplines. It should be construed
more strictly in such cases where an examinee is competing for Civil Service post.
Present case can safely be placed in a category where natural justice before taking any action stood excluded
as it did not involve any misconduct or punishment. Therefore, the Tribunal in issuing the directions
approached the matter technically and completely misdirected itself in this regard.
4. Impracticality
Case Law: R. Radhakrishnan v. Osmania University (AIR 1974 SC 283)-
The MBA Degree course of the Osmania University is apparently much sought after. In 1973, there were a
large number of applicants for a few seats. The University decided to hold an entrance test. The entrance test
was held on 29-7-1973. The result of the test was announced on 10-8-1973. The petitioners in W. P. Nos 4837,
6560 and 6687 of 1973 were among the thirty who were selected for admission. But it was discovered that
there was mass copying at the test. The University, therefore, on 20-8-1973 cancelled the test held on 29-7-73
and announced that another test would be held on 11-11-1973.
The petitioners in W. P. Nos. 6560 and 6687 of 1973 filed the writ petitions objecting to the decision to hold
a fresh test. The principal argument addressed on their behalf was that there was violation of the principles of
natural justice as they were not given any opportunity to explain why the test held on 29-7-1973 at which they
had come out successful should not be cancelled.
It was argued that the cancellation of the test case an aspersion an attack on the reputation or integrity of
someone or something) on the petitioners and therefore it was the duty of the University to give them on
opportunity of explanation before cancelling the test.
The SC held that it was not necessary for the Board to give an opportunity to the candidates if the examinations
as a whole were being cancelled. The Board had not charged any one with unfair means so that he could claim
to defend himself.
The examination was vitiated by adoption of unfair means on a mass scale. In these circumstances it would
be wrong to insist that the Board must hold a detailed inquiry into the matter and examine each individual case
to satisfy itself which of the candidate’s case to satisfy which of the candidates had not adopted unfair means.
The examination as a whole had to go.
5. Interim preventive action
If the action of the administrative authority is a suspension order in the nature of a preventive action and not
a final order, the application of the PNJ may be excluded.
Case Law: Abhay Kumar v. K. Srinivasan (AIR 1981 Del 381)-
Petitioner was suspended from the rolls of the three-year Diploma Course in Pusa Polytechnic Institute, by
the order of the Principal on 16-10-80. By the me order, he was prohibited from entering the premises of the
Polytechnic. He was also directed to vacate the hostel room occupied by him. This was a temporary order. It
was to be in force till the criminal case against him was decided.
In this Writ Petition., the petitioner has challenged this order. The petitioner (along with two other students),
was involved in a stabbing incident in the Polytechnic on 15-11-1979. One Ved parkash Pippal, a student of
first year was stabbed. A criminal case u/s 307 IPC. is pending against these students. The Disciplinary
Committee of the Institute, after due enquiry, had recommended expulsion of these students but the Principal
did not impose the extreme penalty.
The Director of Technical Education, Delhi Administration, has framed rules regarding conduct, discipline
and punishment of the students. Rule-3 lays down what are called the “Forbidden Practices”.
The relevant portion reads: “No student shall indulge in any of the following practices, namely. (a)
.................................... (e) Rowdyism and rude benaviour. (f) Use of violence in any form, (g) Offence of
cognizable nature ..... (i) Any other conduct unbecoming of a student of institution.”
The order of the Principal is challenged on the following grounds:
 No show-cause notice of the proceedings of the Disciplinary Committee was served on the
petitioner. He could not, therefore, participate in the proceedings. This was against the
principles of natural justice;
 The action was in contravention of the petitioner's fundamental right under Article 19 of the
Constitution of India. Right to take education is a fundamental right;
 The order was contrary to social justice;
 The order was mala fide. The Principal has acted in collusion with Ved Parkash Pippal, the
victim of stabbing.
The Delhi High Court rejecting the contention held that such an order could be compared with an order of
suspension pending enquiry which is preventive in nature in order to maintain campus peace hence the
principles of natural justice shall not apply.
6. Legislative Action
Legislative action, plenary or subordinate, is not subject to the rules of NJ because these rules lay down a
policy without reference to a particular individual.
Case Law: Union of India v. Cynamide India Ltd. & Anr. (AIR 1987SC 1802)-
Paragraph 3 of the Drugs (Prices Control) Order, 1979 made by the Central Government in exercise of powers
under s. 3(2)(c) of the Essential Commodities Act, 1955 empowers the Government, after making such enquiry
as it deems fit, to fix the maximum price at which the indigenously manufactured bulk drug shall be sold.
Clause (2) of Paragraph 3 provides that while so fixing the price of a bulk drug, the Government may take
into account the average cost of production of such bulk drug manufactured by a efficient manufacturer and
allow a reasonable return on net worth.
The Central Government issued notifications under paragraph 3 of the 1979 Order fixing the maximum prices
at which various indigenously manufactured bulk drugs could be sold. The manufacturers first filed review
applications under paragraph 27 of the Order and thereafter writ petitions under Art. 226 of the Constitution
challenging the notifications.
The High Court quashed those notifications on the ground of failure to observe the principles of natural justice.
Since prices of formulations are primarily dependent on prices of bulk drugs, the notifications fixing the retail
prices of formulations issued during the pendency of review petitions were also quashed.
The SC held that no principles of Natural Justice had been violated when the Government issued a notification
fixing the Prices of certain drugs. The Court reasoned that since the notification showed from a legislative act
and not an administrative one so Principles of Natural Justice would not have applied.
7. No infringement of rights of persons
Where no right has been conferred on a person by any statute nor any such right arises from common law the
PNJ are not applicable.
Case Law: Andhra Steel Corporation v. A.P. State Electricity Board
The appellants owning mini steel plants have been getting supply of electricity from the Respondent-Board.
The Board revised its terms and conditions for supply of electricity, and concessional tariff of 11 paise per
unit for 3 years from 1.11.1977 was applied to five steel plants. This tariff was subsequently enhanced to 12.5
paise per unit.
However, the concessional tariff was not extended to one of the appellants viz. M/s. Andhra Steel Corporation
since a Writ Petition had been filed by it claiming that the agreement entered into with the Respondent-Board
for availing high tension electric supply was no longer in force. In respect of the other steel plants, the Bard
extended the concessional tariff subject to escalations and other terms and conditions and fixed a certain
minimum consumption.
However, the tariff was revised to 16 paise without reference to the maximum demand charges from 1.3.1978.
In reply to a clarification sought by the Respondent-Board, the State Government clarified that the
Government order did not preclude the Board from applying the normal terms and conditions of supply and
prescribing the monthly minimum charges and the working out of the escalated rate from time to time.
Subsequently the State Government withdrew the concessional tariff. The State Government made a further
clarification that its intention was to allow the concessional tariff without limiting the concession by
imposition of minimum consumption charges till the end of March, 1979.
Aggrieved by the withdrawal of the concessional tariff, the mini steel plants filed Writ Petitions before the
High Court which dismissed the petition.
The SC held that a concession can be withdrawn at any time without affording any opportunity of hearing to
affected persons except when the law requires otherwise or the authority is bound by promissory estoppel.
8. Statutory exception or necessity
Disqualification on the ground of bias against a person will not be applicable if he is the only person competent
or authorised to decide that matter or take that action.
Case Law: Charan Lal Sahu v. Union of India-
Following the Bhopal Gas Leak tragedy when over 3000 people were killed by the leak of a highly toxic
Methyl Isocyanate (MIC) gas from a storage tank at the Bhopal plant of Union Carbide (India) Ltd., the
Government of India, acting as parens patriae, passed the Bhopal Gas Disaster (Processing of Claims) Act,
1985 to take over and pursue the claims of the victims, as they were unable in their circumstances to pursue
their claims fully and properly.
The Petitioner challenged the validity of the Bhopal Gas Disaster (Proceedings of Claims) Act, 1985 in the
Supreme Court on the grounds that the Act is violative of the fundamental rights guaranteed under Articles
14, 19 and 21 of the Constitution.
That the Act is violative of the Principles of Natural Justice mainly on the ground that Union of India, being
a joint tort-feasor, in that it has permitted establishment of such factories without necessary safeguards, has
no locus standi to compromise on behalf of the victims; that the victims and their legal heirs were not given
the opportunity of being heard, before the Act was passed; that in the guise of giving aid, the State could not
destroy the rights inherent in its citizens; nor could it demand the citizens to surrender their rights to the State;
that vesting of the rights in Central Government was bad and unreasonable because there was conflict of
interest between the Central Government and the victims.
Since the Central Government owned 22% share in UCIL, and that would make the Central Government a
Judge in its own cause.
The Court observed that even if the argument was correct the doctrine of necessity would be applicable to the
situation because if the Govt. did not represent the whole class of gas victims no other sovereign body could
represent and thus the PNJ were not attracted.
9. Contractual agreement
Case Law: State of Gujarat v. M.P. Shah Charitable Trust (1994)3 SCC 552-
Meghji Pethraj Shah Medical College was established by the then Government of Saurashtra at Jamnagar in
the year 1955. For establishing the college, Shri M.P. Shah "donated" a sum of Rupees fifteen lakhs subject
to certain conditions(10%quota to donor). The government hospital then known as Irwin Hospital was attached
to the said college to meet the requirement of a hospital with necessary bed-strength.
In the year 1993, after the judgment in J.P. Unnikrishnan v. State of A.P; the Government of Gujarat repudiated
one of the conditions attached to the donation, which led the M.P. Shah Charitable Trust to approach the
Gujarat High Court for issuance of a writ commanding the State of Gujarat to continue to abide by the said
condition. The writ petition was allowed by a learned Single Judge and a Letters Patent Appeal preferred by
the State of Gujarat has been dismissed by a Division Bench the correctness whereof is under challenge herein.
The Supreme Court held that the PNJ are not attracted in the case of termination of an agreement in any
contractual field. Termination of an agreement/arrangement is neither a quasi-judicial nor an administrative
act, so that the duty to act judicially is not attracted.
10. Policy Decision
Case Law: BALCO Employees Union v. Union of India (AIR 1994 SC 552)-
In this case the validity of the decision of the Union of India to disinvest and transfer 51% shares of M/s Bharat
Aluminium Company Limited ('BALCO') is the primary issue. The employees challenged the Govt.’s policy
decision regarding disinvestment in Public Sector Undertakings. • The SC held that in taking of a policy
decision in economic matters at length, the PNJ have no role to play. The SC held that unless the policy
decision to disinvest is capricious, arbitrary, illegal or uninformed, and is not contrary to law, the decision
cannot be challenged on the ground of violation of PNJ.
11. Useless formality
Where on the admitted or undisputed facts only one conclusion is possible and under the law only one possible
penalty is permissible, the Court may not insist on the observance of the PNJ because it would be futile to
order its observance.
Case Law: D. Rai Bahadur Arcot Ramaswamy Mudaliar Edu’l Institution v. Edu’ Appellate Tribunal (AIR
1999 SC 332)-
The appellant institution is a private educational institution conducting a junior college. The respondent was
appointed as a lecturer in Chemistry in the said institution on 5th June, 1973. She applied for grant of leave
for proceeding her higher studies(As a fact she did not join M.Phil course but contrary to the condition of
leave, which was for M.Phil course, she got herself registered for Ph.D course) which was granted subject to
her giving a declaration that after expiry of the leave if she fails to resume her duties, the authorities shall be
entitled to terminate her services.
The case of the appellant is that though an extraordinary leave was granted for specified course with certain
conditions but respondent neither went for the course for which she obtained the leave nor joined back her
duties in spite of the reminder and hence after due notice to respondent and after receipt of her reply and after
giving due consideration to it not finding it satisfactory, terminated her services on 26th February, 1979 under
Sec 608 of the Karnataka Private Educational Institutions (Discipline & Control) Act, 1975.
It is this order which was challenged before the said Tribunal in appeal in which her termination order was set
aside. Aggrieved by the same, the appellant filed Civil Revision in the High Court. The High Court confirmed
the order of the Tribunal by holding neither any enquiry was held nor any opportunity was provided to the
respondent to establish that she had not stayed away wilfully. Aggrieved by this, the present appeal has been
filed.
The SC held that the order of termination was passed in the year 1978 which is more than 21 years back and
on the facts and circumstances of this case, as she is not working since then in the said institution and that she
is already in some job and in view of our findings above and the SC uphold the order of termination dated
26th February, 1979 by applying useless formality theory.

Effects of breach of Principles of Natural Justice

Courts are unanimous that a decision rendered in violation of the rule against bias is merely voidable and not
void. Thus the aggrieved party may waive his right to avoid the decision; as where timely objection is not
made even though there is full knowledge of the bias and the right to object to it.
H.W.R. Wade- “The breaches of the rules of NJ must have the effect of producing void decisions.”
D.M. Gordon- “Procedural breaches can never render a decision void as jurisdictional error.” Thus decisions
are also available on both sides.
Where one of the members of the Selection Committee was himself a candidate for selection, the PNJ were
violated.
Where author members were present in the committee constituted for selection of books written by them, it
was violation of the rules of NJ.
Where personal hearing is given by one officer and order is passed by another officer, the order is impeachable
o the ground of violation of PNJ.
Case Law: Nawab Khan Abbas Khan v. State of Gujarat (AIR 1974 SC 1471)-
The appellant was prosecuted under Sec. 142 of the Bombay Police Act, 1951 on contravention of an
externment order issued under Sec 56 of that Act. During the pendency of the criminal trial, the High Court,
in a petition under Art. 226 of the Constitution, quashed the order of externment on the ground that no
opportunity to show cause was given against allegations relating to areas where the acts were alleged to have
been committed.
In criminal trial, the trial court acquitted the appellant. On appeal by the State the High Court convicted the
appellant. It held that the accused had re-entered the forbidden area during the currency of the order. The High
Court was of the view that the quashing of the order by the court did not render the order of externment void
ad initio but it only invalidated the order with effect from the date of the issue of the writ quashing the order.
On the question whether the externment order having been quashed by the High Court during the pendency
of the criminal trial the order had become void ab initio and there being no quit order there was no offence?
The SC held that an order which infringes a fundamental freedom passed in violation in violation of the ‘audi
alteram partem’ rule is completely void and of no value.
The SC emphasised that externment order passed in violation of PNJ is of no effect and its violation is no
offence because such determination is a jurisdictional error going to the very roots of a determination.
Case Law: A.R. Antulay v. R.S. Nayak (1988) 2 SCC 602)-
The appellant was the Chief Minister of the state of Maharashtra from June 1980. On first September 1981,
an individual from Bharatiya Janata Party approached the Governor of the state under Section 197 of the
Criminal Procedure Code of, 1973 and Section 6 of the Prevention of Corruption Act, 1947 for the approval
to bring a suit against the appellant.
The respondent also filed a complaint with the Additional Metropolitan Magistrate, Bombay contradicting
that the appealing party and others for offences under Section 161,165,384 and 420 read with Sections 109
and 120 B of the Indian Penal Code and Section 5 of the Prevention of the Corruption Act.
The Magistrate did not take any legal notification for the offences without the assent for arraignment. Further,
a revision was filed in the High Court of Bombay.
The allegations of abuse of power resulted in his resignation as chief minister in 1982.
Issues:
 Whether the directions are given by the court in breach of Section 7(1) of the Criminal Law
Amendment act of 1952?
 Whether the decision is violative of Articles 14 and 21 of the Constitution?
On sixteenth February 1984, an appeal was filed under Article 136 and the constitution bench (4:3) of the
Supreme Court held that a member of the legislative assembly is not necessarily a public servant and revoked
the previous order.
He was subsequently allowed bail by the court. However, the Supreme Court later got him free from the
allegation.
The SC held that, any action in violation of the PNJ is a nullity and the trial “coram non judice.” (It is a legal
term basically used to indicate a proceeding which is legal in nature that is outside the authority of a judge
(without a judge), with improper presence, or without legal jurisdiction).