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IN THE HIGH COURT OF CALCUTTA
Harish Tandon, J.
Toorsa Cold Storage Pvt. Ltd. - Petitioner
Versus
State Bank of India - Opposite Party
C.O. No. 2424 of 2015
Decided on : 15-10-2015
NATURAL JUSTICE - VIOLATION - WRITTEN STATEMENT - CONSIDERATION - DEBT RECOVERY TRIBUNAL - SARFAESI ACT - RDB ACT - HEARING - FAIRNESS - PREJUDICE - WRITTEN STATEMENT FILED BUT NOT TAGGED WITH ORIGINAL RECORD - DIRECTIONS ISSUED TO DEBT RECOVERY TRIBUNALS FOR EFFICIENT FUNCTIONING.
Fact of the Case:
The Petitioner challenged the order of the Debt Recovery Tribunal on various grounds, including that the decision was arrived at without considering the defense taken in the written statement, the original whereof was not admittedly taken on record. The Petitioner had filed a written statement on 8th September, 2015 at the Principal Sitting of the Tribunal, Kolkata, when there was a specific order that the original application shall be taken up at camp in Siliguri.
Finding of the Court:
The Court found that the order impugned cannot be said to have not considered the defense taken in the written statement even though the original written statement was not on record. The Debt Recovery Tribunal categorically observed that though the original written statement was not on record, the copy thereof had been submitted by the bank and was treated as part of the record for considering the issues involved therein.
Issues: 1. Whether the order of the Debt Recovery Tribunal was passed in violation of the principles of natural justice by not considering the defense taken in the written statement? 2. Whether the written statement filed by the Petitioner was properly considered by the Debt Recovery Tribunal?
Ratio Decidendi: 1. The Court held that the order impugned cannot be interfered with being an outcome of the violation of the principle of natural justice. 2. The Court observed that the Debt Recovery Tribunal had considered the defense taken in the written statement, even though the original written statement was not on record. The Tribunal had treated the copy of the written statement submitted by the bank as part of the record and had made several observations on the averments made therein.
Final Decision: The Court dismissed the Revisional Application, holding that the order of the Debt Recovery Tribunal was not passed in violation of the principles of natural justice and that the defense taken in the written statement was considered by the Tribunal.
Harish Tandon, J.
“Fairness is what justice really is” are the words of Potter Stewart acclaimed legal recognition as a part of natural justice. The concept of natural justice cannot be confined to any precise definition. The natural justice is fair play in action in its soul and spirit. The quintessence of the process of justice is inspired and guided by fair play in action and as a distillate of due process of law. In the words of Justice R.S. Sarkaria speaking for the majority in case of Swadesi Cotton Mills v. Union of India reported in AIR 1981 Supreme Court 818, the expression “natural justice” is not static nor can be squeezed to a precise definition but considered as a part of natural law relating to the administration of justice. It would be profitable to quote the relevant excerpts from the said report, which runs thus:-
“Well then, what is “natural justice”? The phrase is not capable of a static and precise definition. It cannot be imprisoned in the straight-jacket of a cast-iron formula. Historically, “natural justice” has been used in a way “which implies the existence of moral principles of self-evident and unarguable truth”, “Natural Justice” by Paul Jackson, 2nd Edn. page 1. In course of time, judges nurtured in the traditions of British jurisprudence, often invoked it in conjunction with a reference to “equity and good conscience”. Legal experts of earlier generations did not draw any distinction between “natural justice” and “natural law”, “Natural justice” was considered as “that part of natural law which relates to the administration of justice”. Rules of natural justice are not embodied rules. Being means to an end and not an end in themselves, it is not possible to make an exhaustive catalogue of such rules.”
2. The fair play in action includes an opportunity of being heard before the decision operates against him. The basic concept of natural justice is that a person should not be condemned unheard that is how the legal maxim “audi alteram partem” evolved. In case where the breach of natural justice is alleged the rule of the Court should not be such that it is inflexible rules of universal application but to judge in the light of the facts and circumstances of each case and to call out whether there has been any infraction of such rule. The decree of compliance of the rule of audi alteram partem and resultant effect of its failure depends upon case to case. The essence of natural justice also imbibes a fair hearing to the parties before deciding the issue and ensures the scrupulous administration of justice and fairness. It is not a bull in a china shop or a bee in one’s bonnet. The elements of fair hearing are providing an opportunity of hearing and such opportunity must be real or reasonable. Both the elements are counted in a composite expression of reasonable opportunity, which is not inflexible rule but is elastic one. The reasonableness varies from case to case and it should not shock to the conscience of the Court. The opportunity of hearing not only be real but effective and provide proper latitude to meet everything, which is likely to be considered against the party. The power of High Court under Article 226 and 227 of the Constitution of India is a wide amplitude in the sense that the order passed in gross violation of natural justice having not afforded reasonable opportunity of hearing can be invoked despite existence of alternative remedy. The Doctrine of Prejudice has also received its recognition as every violation of natural justice cannot be impinged unless consequence prejudicially affects the right of aggrieved person.
3. In a recent decision rendered in case of Dharmapal Satyapal Ltd. v. CCE reported in (2015) 8 SCC 519, the Apex Court held that the proceeding must be just fair and reasonable and the negation thereof offends Article 14 and 21 of the Constitution of India. The Doctrine of Prejudice was further noticed as an integral part of the natural justice and comprehended
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