w w w . L a w y e r S e r v i c e s . i n



Centre for Indian Trade Union (CITU), Head Load Workers Unit, Kottayi, Palakkad, Represented by Its Secretary & Others v/s Intercontinental Traders, Kottayi, Palakkad, Represented by Its Managing Director & Others


Company & Directors' Information:- I S G TRADERS LIMITED [Active] CIN = L51909WB1943PLC011567

Company & Directors' Information:- M TO M TRADERS PRIVATE LIMITED [Amalgamated] CIN = U51100GJ2005PTC046435

Company & Directors' Information:- TRADERS PRIVATE LIMITED [Active] CIN = U51909GJ2001PTC040133

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Company & Directors' Information:- TRADERS LIMITED [Strike Off] CIN = U99999MH1948PLC010149

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Company & Directors' Information:- K R TRADERS PVT LTD [Active] CIN = U51909AS1987PTC002815

Company & Directors' Information:- I TRADE LIMITED [Active] CIN = U67120TN1999PLC043813

Company & Directors' Information:- TRADE INDIA LTD [Active] CIN = U51909PB1982PLC004822

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Company & Directors' Information:- R K C TRADERS PRIVATE LIMITED [Active] CIN = U51909WB2009PTC132876

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Company & Directors' Information:- P AND R TRADERS PRIVATE LIMITED [Active] CIN = U51909AS2006PTC008176

Company & Directors' Information:- S K TRADERS PVT LTD [Strike Off] CIN = U17299WB1989PTC046495

Company & Directors' Information:- S D TRADERS PRIVATE LIMITED [Active] CIN = U51909PB2010PTC034457

Company & Directors' Information:- J. D. J. TRADERS PRIVATE LIMITED [Active] CIN = U51109WB2008PTC124248

Company & Directors' Information:- A R TRADE IN PRIVATE LIMITED [Active] CIN = U51909AS1999PTC005710

Company & Directors' Information:- S 3 M TRADE PRIVATE LIMITED [Active] CIN = U74900WB2013PTC193812

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Company & Directors' Information:- M U TRADERS PRIVATE LIMITED [Converted to LLP] CIN = U51900AS2008PTC008853

Company & Directors' Information:- T. P. TRADERS PVT. LTD. [Active] CIN = U25209WB1995PTC068943

Company & Directors' Information:- N. L. TRADERS PRIVATE LIMITED [Strike Off] CIN = U52100UP2012PTC049307

Company & Directors' Information:- INDIAN UNION TRADERS PVT LTD [Active] CIN = U74210WB1948PTC016457

Company & Directors' Information:- P T TRADERS PRIVATE LIMITED [Active] CIN = U67120AS1999PTC005836

Company & Directors' Information:- TRADERS & TRADERS PVT. LTD. [Strike Off] CIN = U51109WB1992PTC055444

Company & Directors' Information:- S K TRADERS PRIVATE LIMITED [Strike Off] CIN = U51109KL2003PTC016071

Company & Directors' Information:- S AND H TRADERS PRIVATE LIMITED [Under Process of Striking Off] CIN = U51909KL1998PTC012688

Company & Directors' Information:- A V H TRADERS PRIVATE LIMITED [Active] CIN = U10100DL2009PTC193000

Company & Directors' Information:- M & I TRADERS PRIVATE LIMITED [Active] CIN = U51109MP2008PTC020491

Company & Directors' Information:- L. K. TRADERS PRIVATE LIMITED [Active] CIN = U50400HR2011PTC043898

Company & Directors' Information:- A V TRADERS PRIVATE LIMITED [Active] CIN = U51909AS2010PTC009934

Company & Directors' Information:- A K TRADE CENTRE PVT LTD [Active] CIN = U51909WB1995PTC067938

Company & Directors' Information:- S I S TRADERS PRIVATE LIMITED [Strike Off] CIN = U51505TN2006PTC058736

Company & Directors' Information:- P G TRADERS PRIVATE LIMITED [Active] CIN = U74120UP2011PTC043805

Company & Directors' Information:- R C TRADERS PRIVATE LIMITED [Active] CIN = U74999UP2016PTC085068

Company & Directors' Information:- M K G TRADERS PRIVATE LIMITED [Active] CIN = U51494DL2008PTC183965

Company & Directors' Information:- S L TRADERS PRIVATE LIMITED [Strike Off] CIN = U15109UP1987PTC008981

Company & Directors' Information:- K N TRADERS PRIVATE LIMITED [Strike Off] CIN = U51109DL1984PTC017665

Company & Directors' Information:- S R TRADERS PVT LTD [Active] CIN = U51909WB1985PTC039063

Company & Directors' Information:- THE INDIAN CORPORATION PRIVATE LIMITED [Active] CIN = U65993TN1946PTC000988

Company & Directors' Information:- B P TRADERS PVT LTD [Strike Off] CIN = U28931WB1980PTC032693

Company & Directors' Information:- K A TRADERS PRIVATE LIMITED [Strike Off] CIN = U74899DL1994PTC060650

Company & Directors' Information:- A M TRADERS PRIVATE LIMITED [Strike Off] CIN = U52100DL1993PTC054323

Company & Directors' Information:- O B S TRADERS PVT LTD [Active] CIN = U74899DL1990PTC039242

Company & Directors' Information:- Y. R. TRADERS PRIVATE LIMITED [Active] CIN = U51909WB2011PTC163724

Company & Directors' Information:- C TRADE (INDIA) PRIVATE LIMITED [Active] CIN = U74900KA2008PTC045372

Company & Directors' Information:- V D M TRADERS PRIVATE LIMITED [Strike Off] CIN = U51392KL2003PTC016586

Company & Directors' Information:- V C TRADERS PRIVATE LIMITED [Strike Off] CIN = U51496KL2005PTC018548

Company & Directors' Information:- J AND J TRADERS PRIVATE LIMITED [Strike Off] CIN = U19129UP1992PTC014356

Company & Directors' Information:- B AND M TRADERS PVT LTD [Strike Off] CIN = U52321TN1988PTC016066

Company & Directors' Information:- A V V S TRADERS PVT LTD. [Strike Off] CIN = U51102TN1988PTC016437

Company & Directors' Information:- V M TRADERS PVT LTD [Strike Off] CIN = U05001UP1990PTC011859

Company & Directors' Information:- A P TRADERS PRIVATE LIMITED [Active] CIN = U17297UP1994PTC016102

Company & Directors' Information:- A A TRADERS PRIVATE LIMITED [Active] CIN = U74899DL1964PTC004250

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Company & Directors' Information:- R K TRADERS PVT LTD [Active] CIN = U31200MH1976PTC018744

Company & Directors' Information:- D AND P TRADERS PRIVATE LIMITED [Strike Off] CIN = U52322PN2009PTC133581

Company & Directors' Information:- I-W TRADE PRIVATE LIMITED [Strike Off] CIN = U93030MH2012PTC233832

Company & Directors' Information:- M M TRADERS PRIVATE LIMITED [Active] CIN = U51500MH1975PTC018056

Company & Directors' Information:- N R TRADERS PRIVATE LIMITED [Strike Off] CIN = U51900MH2005PTC157670

Company & Directors' Information:- U M TRADE PRIVATE LIMITED [Active] CIN = U67190MH2011PTC224523

Company & Directors' Information:- R K TRADERS PRIVATE LIMITED [Active] CIN = U23201MH1976PTC018743

Company & Directors' Information:- M. P. TRADERS PRIVATE LIMITED [Active] CIN = U51909WB2016PTC215988

Company & Directors' Information:- CENTRE TRADERS PRIVATE LIMITED [Strike Off] CIN = U74900WB2010PTC152302

Company & Directors' Information:- A & T TRADERS PRIVATE LIMITED [Active] CIN = U51900CH2015PTC035530

Company & Directors' Information:- B M TRADERS PRIVATE LIMITED [Strike Off] CIN = U51909CH2010PTC032424

Company & Directors' Information:- R S C TRADERS PRIVATE LIMITED [Strike Off] CIN = U93091DL2006PTC149264

Company & Directors' Information:- U R TRADERS PRIVATE LIMITED [Strike Off] CIN = U74899DL1994PTC056950

Company & Directors' Information:- L M TRADERS PRIVATE LIMITED [Active] CIN = U51497DL2014PTC274205

Company & Directors' Information:- M K R K TRADERS PRIVATE LIMITED [Strike Off] CIN = U51909DL2005PTC141404

Company & Directors' Information:- G R S TRADERS PRIVATE LIMITED [Converted to LLP] CIN = U51311DL2002PTC116627

Company & Directors' Information:- G G M TRADERS PRIVATE LIMITED [Strike Off] CIN = U74899DL2001PTC109116

Company & Directors' Information:- INDIA TRADERS PRIVATE LIMITED [Strike Off] CIN = U74900DL2014PTC269271

Company & Directors' Information:- S K G TRADERS PRIVATE LIMITED [Active] CIN = U52100DL2011PTC213707

Company & Directors' Information:- S M L TRADERS PRIVATE LIMITED [Strike Off] CIN = U51909AP2010PTC068983

Company & Directors' Information:- F & F TRADERS PRIVATE LIMITED [Active] CIN = U51900MP2010PTC023505

Company & Directors' Information:- M G TRADERS (INDIA) PRIVATE LIMITED [Strike Off] CIN = U51101KA2012PTC066173

Company & Directors' Information:- V S TRADERS PRIVATE LIMITED [Active] CIN = U23109GJ2002PTC040842

Company & Directors' Information:- V AND O TRADERS PRIVATE LIMITED [Active] CIN = U51909MH2020PTC345927

Company & Directors' Information:- D & R TRADERS PRIVATE LIMITED [Strike Off] CIN = U74999DL1996PTC081454

Company & Directors' Information:- R S TRADERS PVT LTD [Strike Off] CIN = U24119WB1980PTC033197

Company & Directors' Information:- A. L. TRADERS PRIVATE LIMITED [Strike Off] CIN = U74999DL2000PTC105282

Company & Directors' Information:- K S TRADERS PVT LTD [Strike Off] CIN = U51909PB1990PTC010753

Company & Directors' Information:- P S TRADERS PRIVATE LIMITED [Strike Off] CIN = U92490TN1979PTC007957

Company & Directors' Information:- S P TRADERS PVT LTD [Strike Off] CIN = U51909WB1985PTC038361

Company & Directors' Information:- THE WORKERS CORPORATION PVT LTD [Strike Off] CIN = U36900WB1947PTC014001

Company & Directors' Information:- S S TRADERS AND CO PVT LTD [Strike Off] CIN = U65923DL1959PTC003031

Company & Directors' Information:- A K L TRADERS PVT LTD [Strike Off] CIN = U51909MP1989PTC005014

Company & Directors' Information:- WORKERS CORPN PVT LTD [Strike Off] CIN = U74140WB1947PTC015663

Company & Directors' Information:- TRADERS LIMITED [Dissolved] CIN = U99999MH1951PLC010277

Company & Directors' Information:- INDIAN TRADERS PRIVATE LIMITED [Under Liquidation] CIN = U74999DL1963PTC002153

    WA. No. 2484 of 2019

    Decided On, 13 December 2019

    At, High Court of Kerala

    By, THE HONOURABLE CHIEF JUSTICE MR. S. MANIKUMAR & THE HONOURABLE MRS. JUSTICE ANU SIVARAMAN

    For the Appellants: T.C. Suresh Menon, P.S. Appu, A.R. Nimod, Advocates. For the Respondents: R3, Thomas Abraham, SC, KHWWB, R2, Aravind Kumar Babu, Sr. GP., R1, Jacob Sebastian, Advocate.



Judgment Text


S. Manikumar, C.J.

1. Instant writ appeal is filed against the interim order passed in W.P.(C) No.30134 of 2019 dated 20.11.2019 by a learned Single Judge of this Court, commanding the Sub Inspector of Police, respondent No.1 therein, to ensure that members of respondent trade unions do not interfere in any manner, with the loading and unloading activity in the petitioner's establishment or do not block the vehicles coming to and going out of the establishment pending disposal of the writ petition.

2. Short facts leading to the appeal are that,- appellants are the registered trade unions and its members are persons with registration numbers under Rule 26A of the Kerala Headload Workers Rules, 1981. Intercontinental Traders, Palakkad, represented by its Managing Director, respondent No.1 herein, is proposing to construct a godown in relation to the trade in spices. Area where the godown is situated, comes within the area of operation of Pool No.8, which is having more than 20 years of service. Alleging that members of the appellants had physically obstructed the activities of the establishment, Intercontinental Traders, Palakkad, respondent No.1, has approached the writ court seeking police protection. The appellants have further stated that the 1st respondent is fully involved in the construction process of the godown, which commenced on 11.06.2018 and later on 11.11.2019 and the tiles brought to the godown are unloaded. Again on 19.11.2019, hollow bricks were unloaded by them.

3. The appellants have further stated that the area of operation of Pool No.8 viz., Kariyamkode is having acute shortage of work and the registered headload workers are struggling for their livelihood. The Kerala Headload Workers (Regulation of Employment and Welfare) Scheme, 1983 is not made applicable to Kariyamkode. Due to the fact that there was shortage of work and shortage of workers, the existing workers were forcefully evicted from the Scheme by the Kerala Head Load Workers Welfare Fund Board, Palakkad, represented by its District Officer, respondent No.3, merely for the reason that they are entitled for any benefits under the Scheme, which would be detrimental to the 3rd respondent. The appellants also stated that the writ court without affording an opportunity of being heard to them passed the interim order dated 20.11.2019 in W.P.(C) No.30134 of 2019.

4. Being aggrieved, instant writ appeal is filed on the grounds inter alia that,-

(i) Writ court ought to have afforded an opportunity to the appellants to file their counter affidavit putting forth their defence.

(ii) Writ court failed to realise that the Scheme was very much applicable to the area and the registered workers were forcefully evicted from the Scheme by the 3rd respondent, who were more interest in protecting their interests.

(iii) Writ court ought to have seen that the 1st respondent did not have any registered worker of their own so as to dislodge the claim of the appellants.

(iv) The learned single Judge got carried away by the mere averments in the writ petition, that the appellants had caused obstruction to the activities of the 1st respondent.

(v) The appellants were, in fact, actively involved with the establishment from its very inception and they had worked even as on 19.11.2019 without any room for complaint.

5. Based on the above grounds, Mr. P.S.Appu, learned counsel for the appellants, made submissions. He referred to the representation dated 4.11.2019 (Ext.P3) made by the writ petitioner/respondent No.1 to the Sub Inspector of Police, Kottayi Police Station, Palakkad, seeking for police protection. Representation dated 4.11.2019 is extracted hereunder:-

“From

Suresh Kumar U.R

Managing Director

Intercontinental Traders; 5/590,

Kariyamkode P. 0., Kottayi

Palakkad-678 572.

To

The Sub Inspector of Police

Kottayi Police Station, Palakkad.

Sir,

Sub:-Seeking police protection for the trading activities and head load work in Intercontinental Traders, Kariyamkode, Palakkad.

1. Intercontinental Traders (for brevity the establishment) is a private limited company engaged in the business of storage and sale of spices. I am the managing director of the establishment. The establishment has got all licenses and permits to operate the same. The establishment is located at Kariyakode in Kottayi within the limits of the Kottayi Police Station. The activity in the establishment consists of manufacturing, storage, and sale of spices.

2. The Kerala Head Load Workers (Regulation of Employment and Welfare) Scheme, 1983 is not implemented at Kariyamkode in Kottayi where the establishment is located. Hence there is no prohibition against engaging and registered workers for doing the head load work in the establishment.

3. Now head load workers belonging to trade unions (CITU, I.N.T.U.C & STU of the region)'are demanding work-in the establishment. The workers attached to the union trespassed ‘into the premises of the establishment on two occasions and obstructed the work demanding head load work asserting that any kind of head load work anywhere is their absolute right. On November 2, 2019 unattached head load workers owing allegiance to unions trespassed into the establishments premises and created obstruction. They claim that unloading of goods anywhere is their exclusive right and nobody else shall be permitted to do such work. Workers belonging to unions have no right to work in the establishment. The establishment is located beyond the area allotted to those workers.

4. The unattached head load workers under the unions threatened that the workers belonging to the unions should be exclusively engaged for doing the incidental head load work in the establishment. They created obstruction. While withdrawing from the scene, workers belonging to the trade unions have openly threatened that they would not let them do business without engaging workers belonging to the unions. Otherwise, I will have to pay them money as demanded by them to stay away from the establishment, so that my workers can do the work. They are also blocking the vehicles of the establishment. Their activities against establishment are illegal. Due to the continuing threat, of the members of the unions the entire activity of the establishment is paralysed.

5. In the above circumstances you may be pleased to provide adequate police protection for the activities in the establishment, its workers and for the vehicles used for transporting goods of the establishment.

Place: Kariyamkode

Date: 04.11.2019

Yours faithfully

Suresh Kumar U.R

Managing Director

Intercontinental Traders; 5/590

Kariyamkode P. O., Kottayi

Palakkad-678 572.”

6. Per contra, Mr.Jacob Sebastian, learned counsel for the 1st respondent, submitted that the area where the godown is situated does not fall under the Scheme and, therefore, if the order impugned is set aside, workers of the unions would barge into the office of the 1st respondent. He further submitted that the interim order can be restricted for a limited period and the writ court may be requested to pass a detailed order. He also submitted that though the appellants were put on notice, they did not file any counter affidavit, refuting the averments made by the writ petitioner/respondent No.1. For the above reasons, he prayed to sustain the order dated 20.11.2019 in W.P(C) No.30134 of 2019.

7. Heard learned counsel for the parties and perused the material available on record.

8. The main prayers sought for by the writ petitioner/respondent No.1 before the writ court are as follows:

“I. Issue a writ in the nature of mandamus or any other appropriate writ, order or direction commanding the 1st respondent to afford effective protection to the petitioner's establishment, his workers and for the vehicles used for transporting goods of the petitioners.

II. Issue a writ in the nature of Mandamus or any other appropriate writ, order or direction commanding the 1st respondent to ensure that members of the respondent trade unions do not interfere in any manner with the loading and unloading activity in the petitioner's establishment or do not block the vehicles coming to and going out of the establishment.”

9. Interim relief sought for in the writ petition is extracted hereunder:

“Issue an interim direction commanding the 1st respondent to ensure that members of respondent trade union do not interfere in any manner, with the loading and unloading activity in the petitioner's establishment or do not block the vehicles coming to and going out of the establishment pending result of the above writ petition.”

10. Material on record discloses that representation to the Sub Inspector of Police, Kottayi Police Station, Palakkad, has been made on 4.11.2019. Writ petition has been filed on 6.11.2019. Though notice has been given to the appellants, no counter affidavit has been filed.

11. Be that as it may, when one of the main prayers and interim prayer sought for are one and the same, while exercising discretion, writ court ought to have considered the basic facts as to whether there is any prima facie, in the apprehension of the 1st respondent and whether passing of an interim order is imminent, moreso, when a final order in the interlocutory application. Let us consider a few decisions as to whether an interim order can be granted in the form of a final order, when the main prayer is the same.

(i) “In State of U.P., v. Modern Transport Co., Ludhiana reported in (2002) 9 SCC 514, the relief sought for, in the writ petition, was against the seizure of a vehicle and detention of goods. Direction sought for was the release of the goods and vehicle. After perusal of the order, the Apex Court has observed that the there was nothing to indicate that any notice was issued and adequate opportunity was given to the appellants therein, to file a reply in opposition to the writ petition. Without giving any reason whatsoever, orders were passed by the High Court, directing release of truck and the goods. That was the only prayer in the writ petition and on the above facts, the Supreme Court, observed that it was unfortunate that the High Court has given no reason whatsoever in support of its order and by virtue of the same, the main relief itself has been granted.

(ii) The Hon'ble Apex Court in State of U.P v. Ram Sukhi Devi, (2005) 9 SCC 733, wherein in paragraph 8, the Hon'ble Apex Court clearly held that final relief cannot be granted by way of interim relief. Paragraph 8 of the aforesaid decision is extracted below:-

"To say the least, approach of the learned Single Judge and the Division Bench is judicially unsustainable and indefensible. The final relief sought for in the writ petition has been granted as an interim measure. There was no reason indicated by learned Single Judge as to why the Government Order dated 26.10.1998 was to be ignored. Whether the writ petitioner was entitled to any relief in the writ petition has to be adjudicated at the time of final disposal of the writ petition. This Court has on numerous occasions observed that the final relief sought for should not be granted at an interim stage. The position is worsened if the interim direction has been passed with stipulation that the applicable Government Order has to be ignored. Time and again this Court has deprecated the practice of granting interim orders which practically give the principal relief sought in the petition for no better reason than that of a prima facie case has been made out, without being concerned about the balance of convenience, the public interest and a host of other considerations. [See Assistant Collector of Central Excise, West Bengal v. Dunlop India Ltd. (1985 (1) SCC 260 at p. 265), State of Rajasthan v. M/s Swaika Properties (1985 (3) SCC 217 at p.224), State of U.P. and Ors. v. Visheshwar (1995 Supp (3) SCC 590), Bharatbhushan Sonaji Kshirsagar (Dr.) v. Abdul Khalik Mohd. Musa and Ors. (1995 Supp (2) SCC 593), Shiv Shankar and Ors. v. Board of Directors, U.P.S.R.T.C. and Anr. (1995 Supp (2) SCC 726) and Commissioner/Secretary to Govt. Health and Medical Education Department Civil Sectt., Jammu v. Dr. Ashok Kumar Kohli (1995 Supp (4) SCC 214).] No basis has been indicated as to why learned Single Judge thought the course as directed was necessary to be adopted. Even it was not indicated that a prima facie case was made out though as noted above that itself is not sufficient. We, therefore, set aside the order passed by learned Single Judge as affirmed by the Division Bench without expressing any opinion on the merits of the case we have interfered primarily on the ground that the final relief has been granted at an interim stage without justifiable reasons. Since the controversy lies within a very narrow compass, we request the High Court to dispose of the matter as early as practicable preferably within six months from the date of receipt of this judgment."

(iii) In Deoraj v. State of Maharashtra reported in AIR 2004 SC 1975, the Hon'ble Supreme Court held thus,-

"The Petitioner filed the writ Petition for seeking quashing of the Order passed by the Telsildar-cum-Returning officer and for seeking a command to complete the election programme as scheduled by resuming the same from the stage at which it had stopped. The Petitioner had also sought interim relief to the effect that he be declared as duly elected Chairman of the Sangh. While granting the interim relief in Writ Petition the Court observed that the situations may emerge where the granting of an interim relief would tantamount to granting the final relief itself and then there may be converse cases where withholding of an interim relief would tantamount to dismissal of main Petition itself or for by the time the main matter comes up for hearing there would be nothing left to be allowed as relief to the Petitioner though all the findings may be in his favour. Considering and being fully satisfied that a foolproof case for the grant of interim relief was made out in favour of the Petitioner in the High Court on the basis of the material available before the Court, the Court granted the relief at the interlocutory stage."

In the reported case, the Hon'ble Supreme Court held that there was a foolproof case, for the grant of interim relief. But, in the case on hand, with due respect, no such consideration has been made by the writ court.

(iv) In Hammad Ahmed versus Abdul Majeed and others reported in 2019 (5) SCALE 698, Court held thus:

"In the present case it was argued before the Court that in an Application under Order XXXIX Rules 1 and 2 of the CPC, the Court cannot grant an interim mandatory relief resulting in creation of entirely new state of affairs which hitherto never existed. Rejecting the said argument the Court observed that the said rule is not general rule of universal application. The Court granted the interim mandatory injunction sought for by the Plaintiff thereby noting the balance of convenience in favour of the Plaintiff and directed the Defendants to handover the password of the domain name for discharging the duties of chief Mutawalli of Hamdard Laboratories (India) which was claimed by both of the parties."

12. In exercise of discretion courts can grant interim orders, but reasons have to be assigned as to why such interim orders are required to be passed, moreso, when the main prayer is one and the same. Going through the order impugned, we find no reasons, as to why the writ court has passed a final order, which is in the nature of granting the main relief, sought for in the writ petition. On the aspects of reasons, we deem it fit to consider a few decisions.

(i) M/s.Steel Authority of India Ltd., v. STO, Rourkela-I Circle & Ors. reported in 2008 (5) Supreme 281, wherein the Hon'ble Supreme Court, while testing the correctness of an order passed by the Assistant Commissioner of Sales Tax against the assessment, at Paragraph 10, held as follows:

"10. Reason is the heartbeat of every conclusion. It introduces clarity in an order and without the same it becomes lifeless."

(ii) In Kranti Associates Private Limited and another v. Masood Ahamed Khan and Others reported in (2010) 9 SCC 496, wherein, the Hon'ble Supreme Court has considered a catena of decisions, which are extracted hereunder:

“12. The necessity of giving reason by a body or authority in support of its decision came up for consideration before this Court in several cases. Initially this Court recognised a sort of demarcation between administrative orders and quasijudicial orders but with the passage of time the distinction between the two got blurred and thinned out and virtually reached a vanishing point in the judgment of this Court in A.K. Kraipak v. Union of India [(1969) 2 SCC 262].”

(iii) In Harinagar Sugar Mills Ltd. v. Shyam Sunder Jhunjhunwala [AIR 1961 SC 1669], the question of recording reasons came up for consideration in the context of a refusal by Harinagar to transfer, without giving reasons, shares held by Shyam Sunder. Challenging such refusal, the transferee moved the High Court contending, inter alia, that the refusal is mala fide, arbitrary and capricious. The High Court rejected such pleas and the transferee was asked to file a suit. The transferee filed an appeal to the Central Government under Section 111(3) of the Companies Act, 1956 which was dismissed. Thereafter, the son of the original transferee filed another application for transfer of his shares which was similarly refused by the Company. On appeal, the Central Government quashed the resolution passed by the Company and directed the Company to register the transfer. However, in passing the said order, the Government did not give any reason. The Company challenged the said decision before this Court. The other question which arose in Harinagar was whether the Central Government, in passing the appellate order acted as a tribunal and is amenable to Article 136 jurisdiction of this Court.

Even though in Harinagar the decision was administrative, this 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 (AIR pp. 1678-79, para 23).

(iv) In Bhagat Raja v. Union of India [AIR 1967 SC 1606] the Constitution Bench of the Hon'ble Supreme 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 in the context of the Mines and Minerals (Development and Regulation) Act, 1957, and having regard to the provision of Rule 55 of the Mineral Concession Rules. The Constitution Bench held that in exercising its power of revision under the aforesaid Rule the Central Government acts in a quasijudicial capacity (see AIR p. 1610, para 8). Where 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 of the State Government without specifying any reason, this Court, exercising its jurisdiction under Article 136, may find it difficult to ascertain which are the grounds on which the Central Government upheld the order of the State Government (see AIR p. 1610, para 9). Therefore, this Court insisted on reasons being given for the order.

(v) In Mahabir Prasad Santosh Kumar v. State of U.P. [(1970) 1 SCC 764], while dealing with the U.P. Sugar Dealers' Licensing Order under which the licence was cancelled, this Court held that such an order of cancellation is quasi-judicial and must be a speaking one. This 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. The learned Judges held that the recording of reasons in support of a decision on a disputed claim ensures that the decision is not a result of caprice, whim or fancy but was arrived at after considering the relevant law and that the decision was just. (See SCC p. 768, para 7 : AIR p. 1304, para 7.)

(vi) In Travancore Rayon Ltd. v. Union of India [(1969) 3 SCC 868], the Hon'ble Apex Court, dealing with the revisional jurisdiction of the Central Government under the then Section 36 of the Central Excises and Salt Act, 1944, held that the Central Government was actually exercising judicial power of the State and in exercising judicial power reasons in support of the order must be disclosed on two grounds. The first is that the person aggrieved gets an opportunity to demonstrate that the reasons are erroneous and secondly, the obligation to record reasons operates as a deterrent against possible arbitrary action by the executive authority invested with the judicial power (see SCC p. 874, para 11 : AIR pp. 865-66, para 11).

(vii) In Woolcombers of India Ltd. v. Workers Union [(1974) 3 SCC 318] the Hon'ble Apex Court while considering an award under Section 11 of the 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. Reasoned and just conclusion on the other hand will also have the appearance of justice. The third ground is that such awards are subject to Article 136 jurisdiction of this Court and in the absence of reasons, it is difficult for this Court to ascertain whether the decision is right or wrong (see SCC pp. 320-21, para 5 : AIR p. 2761, para 5).

(viii) In Union of India v. Mohan Lal Capoor [(1973) 2 SCC 836], the Hon'ble Supreme Court while dealing with the question of selection under the Indian Administrative Service/Indian Police Service (Appointment by Promotion) Regulations held that the expression “reasons for the proposed supersession” should not be mere rubber-stamp reasons. Such reasons must disclose how mind was applied to the subject-matter for a decision regardless of the fact whether such a decision is purely administrative or quasijudicial. This Court held that the reasons in such context would mean the link between materials which are considered and the conclusions which are reached. Reasons must reveal a rational nexus between the two (see SCC pp. 853-54, paras 27-28 : AIR pp. 97-98, paras 27-28).

(ix) In Siemens Engg. and Mfg. Co. of India Ltd. v. Union of India [(1976) 2 SCC 981], the Hon'ble Supreme Court held that it is far too well settled that an authority in making an order in exercise of its quasi-judicial function, must record reasons in support of the order it makes. The learned Judges emphatically said that every quasi-judicial order must be supported by reasons. The rule requiring reasons in support of a quasi-judicial order is, this Court held, 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 (see SCC p. 986, para 6 : AIR p. 1789, para 6).

(x) In Maneka Gandhi v. Union of India [(1978) 1 SCC 248],which is a decision of great jurisprudential significance in our constitutional law, Beg, C.J. in a concurring but different opinion held that an order impounding a passport is a quasi-judicial decision (SCC p. 311, para 34 : AIR p. 612, para 34). The learned Chief Justice also held, when an administrative action involving any deprivation of or restriction on fundamental rights is taken, the authorities must see that justice is not only done but manifestly appears to be done as well. This principle would obviously demand disclosure of reasons for the decision.

Y.V. Chandrachud, J. (as His Lordship then was) in a concurring but a separate opinion in Maneka Gandhi also held that refusal to disclose reasons for impounding a passport is an exercise of an exceptional nature and is to be done very sparingly and only when it is fully justified by the exigencies of an uncommon situation. The learned Judge further held that law cannot permit any exercise of power by an executive to keep the reasons undisclosed if the only motive for doing so is to keep the reasons away from judicial scrutiny. (See SCC p. 317, para 39 : AIR p. 613, para 39.)

(xi) In Rama Varma Bharathan Thampuram v. State of Kerala [(1979) 4 SCC 782] V.R. Krishna Iyer, J. speaking for a three-Judge Bench held that the functioning of the Board was quasi-judicial in character. One of the attributes of quasi-judicial functioning is the recording of reasons in support of decisions taken and the other requirement is following the principles of natural justice. The learned Judge held that natural justice requires reasons to be written for the conclusions made (see SCC p. 788, para 14 : AIR p. 1922, para 14).

(xii) In Gurdial Singh Fijji v. State of Punjab [(1979) 2 SCC 368] the Hon'ble Supreme Court, dealing with a service matter, relying on the ratio in Capoor, held that “rubberstamp reason” is not enough and virtually quoted the observation in Capoor to the extent that: (Capoor case, SCC p. 854, para 28)

“Reasons are the links between the materials on which certain conclusions are based and the actual conclusions.”

(xiii) In a Constitution Bench decision of this Court in H.H. Shri Swamiji of Shri Amar Mutt v. Commr., Hindu Religious and Charitable Endowments Deptt. [(1979) 4 SCC 642]. while giving the majority judgment Y.V. Chandrachud, C.J. referred to (SCC p. 658, para 29) Broom's Legal Maxims (1939 Edn., p. 97) where the principle in Latin runs as follows:

“Cessante ratione legis cessat ipsa lex.”

The English version of the said principle given by the Chief Justice is that: (H.H. Shri Swamiji case, SCC p. 658, para 29)

“29. Reason is the soul of the law, and when the reason of any particular law ceases, so does the law itself.”

(xiv) In Bombay Oil Industries (P) Ltd. v. Union of India [(1984) 1 SCC 141], the Hon'ble Supreme Court held that,-

“While disposing of applications under the Monopolies and Restrictive Trade Practices Act the duty of the Government is to give reasons for its order. This Court made it very clear that the faith of the people in administrative tribunals can be sustained only if the tribunals act fairly and dispose of the matters before them by well-considered orders. In saying so, this Court relied on its previous decisions in Capoor and Siemens Engg. discussed above.”

(xv) In Ram Chander v. Union of India [(1986) 3 SCC 103], the Hon'ble Supreme Court was dealing with the appellate provisions under the Railway Servants (Discipline and Appeal) Rules, 1968 condemned the mechanical way of dismissal of appeal in the context of requirement of Rule 22(2) of the aforesaid Rules. This Court held that the word “consider” occurring in Rule 22(2) must mean that the Railway Board shall duly apply its mind and give reasons for its decision. The learned Judges held that the duty to give reason is an incident of the judicial process and emphasised that in discharging quasi-judicial functions the appellate authority must act in accordance with natural justice and give reasons for its decision.

(xvi) In Star Enterprises v. City and Industrial Development Corpn. of Maharashtra Ltd. [(1990) 3 SCC 280] a three-Judge Bench of the Hon'ble Supreme Court held that in the present day set-up judicial review of administrative action has become expansive and is becoming wider day by day and the State has to justify its action in various fields of public law. All these necessitate recording of reason for executive actions including the rejection of the highest offer. This Court held that disclosure of reasons in matters of such rejection provides an opportunity for an objective review both by superior administrative heads and for judicial process and opined that such reasons should be communicated unless there are specific justifications for not doing so (see SCC pp. 284-85, para 10).

(xvii) In Maharashtra State Board of Secondary and Higher Secondary Education v. K.S. Gandhi [(1991) 2 SCC 716], the Hon'ble Apex 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 (see SCC pp. 738-39, para 22).

(xviii) In M.L. Jaggi v. MTNL [(1996) 3 SCC 119], the Hon'ble Apex 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. It was also held that such reasons are to be recorded so that it enables the High Court to exercise its power of judicial review on the validity of the award.

(xix) In Charan Singh v. Healing Touch Hospital [(2000) 7 SCC 668] a three-Judge Bench of the Hon'ble Apex Court, dealing with a grievance under the CP Act, held that the authorities under the Act exercise quasi-judicial powers for redressal of consumer disputes and it is, therefore, imperative that such a body should arrive at conclusions based on reasons. This Court held that the said Act, being one of the benevolent pieces of legislation, is intended to protect a large body of consumers from exploitation as the said Act provides for an alternative mode for consumer justice by the process of a summary trial. The powers which are exercised are definitely quasi-judicial in nature and in such a situation the conclusions must be based on reasons and held that requirement of recording reasons is “too obvious to be reiterated and needs no emphasising”. (See SCC p. 673, para 11 : AIR p. 3141, para 11 of the Report.)

(xx) Only in cases of Court Martial, this Court struck a different note in two of its Constitution Bench decisions, the first of which was rendered in Som Datt Datta v. Union of India [AIR 1969 SC 414] where Ramaswami, J. delivering the judgment for the unanimous Constitution Bench held that provisions of Sections 164 and 165 of the Army Act do not require an order confirming proceedings of Court Martial to be supported by reasons. This Court held that an order confirming such proceedings does not become illegal if it does not record reasons. (AIR pp. 421-22, para 10 of the Report.)

(xxi) About two decades thereafter, a similar question cropped up before this Court in S.N. Mukherjee v. Union of India [(1990) 4 SCC 594]. A unanimous Constitution Bench speaking through S.C. Agrawal, J. confirmed its earlier decision in Som Datt in S.N. Mukherjee case, SCC p. 619, para 47 : AIR para 47 at p. 2000 of the Report and held that reasons are not required to be recorded for an order confirming the finding and sentence recorded by the Court Martial.

It must be remembered in this connection that the court martial as a proceeding is sui generis in nature and the Court of Court Martial is different, being called a court of honour and the proceedings therein are slightly different from other proceedings. About the nature of Court Martial and its proceedings the observations of Winthrop in Military Law and Precedents are very pertinent and are extracted hereinbelow:

“Not belonging to the judicial branch of the Government, it follows that Courts Martial must pertain to the executive department; and they are in fact simply instrumentalities of the executive power, provided by Congress for the President as Commander-in-Chief, to aid him in properly commanding the Army and Navy and enforcing discipline therein, and utilised under his orders or those of his authorised military representatives.”

(xxii) In England there was no common law duty of recording of reasons. In Stefan v. General Medical Council [(1999) 1 WLR 1293 (PC) it has been held: (WLR p. 1300) the established position of the common law is that there is no general duty imposed on our decision makers to record reasons. It has been acknowledged in the Justice Report, Administration Under Law (1971) at p. 23 that:

“No single factor has inhibited the development of English administrative law as seriously as the absence of any general obligation upon public authorities to give reasons for their decisions.”

Even then in R. v. Civil Service Appeal Board, ex p Cunningham [(1991) 4 All ER 310 (CA), Lord Donaldson, Master of Rolls, opined very strongly in favour of disclosing of reasons in a case where the Court is acting in its discretion. The learned Master of Rolls said: (All ER p. 317) “it is a corollary of the discretion conferred upon the Board that it is their duty to set out their reasoning in sufficient form to show the principles on which they have proceeded. Adopting Lord Lane, C.J.'s observations [in R. v. Immigration Appeal Tribunal, ex p Khan (Mahmud) [1983 (2) ALL ER 420 (CA)] All ER at p. 423, QB at pp. 794-95], the reasons for the lower amount is not obvious. Mr Cunningham is entitled to know, either expressly or inferentially stated, what it was to which the Board were addressing their mind in arriving at their conclusion. It must be obvious to the Board that Mr Cunningham is left with a burning sense of grievance. They should be sensitive to the fact that he is left with a real feeling of injustice, that having been found to have been unfairly dismissed, he has been deprived of his just desserts (as he sees them).”

The learned Master of Rolls further clarified by saying: (Civil Service Appeal Board case [(1991) 4 All. ER 310 (Ca), All ER p. 317) Thus, in the particular circumstances of this case, and without wishing to establish any precedent whatsoever, I am prepared to spell out an obligation on this Board to give succinct reasons, if only to put the mind of Mr Cunningham at rest. I would therefore allow this application.

But, however, the present trend of the law has been towards an increasing recognition of the duty of court to give reasons (see North Range Shipping Ltd. v. Seatrans Shipping Corpn. [(2002) 1 WLR 2397). It has been acknowledged that this trend is consistent with the development towards openness in the Government and judicial administration.

(xxiii) In English v. Emery Reimbold and Strick Ltd. [(2002) 1 WLR 2409], it has been held that justice will not be done if it is not apparent to the parties why one has won and the other has lost. The House of Lords in Cullen v. Chief Constable of the Royal Ulster Constabulary [(2003) 1 WLR 1763], Lord Bingham of Cornhill and Lord Steyn, on the requirement of reason held: (WLR p. 1769, para 7)

“7. First, they impose a discipline which may contribute to such refusals being considered with care. Secondly, reasons encourage transparency. Thirdly, they assist the courts in performing their supervisory function if judicial review proceedings are launched.”

(xxiv) The position in the United States has been indicated by this Court in S.N. Mukherjee in SCC p. 602, para 11 : AIR para 11 at p. 1988 of the judgment. This Court held that in the United States the courts have always insisted on the recording of reasons by administrative authorities in exercise of their powers. It was further held that such recording of reasons is required as “the courts cannot exercise their duty of review unless they are advised of the considerations underlying the action under review”. In S.N. Mukherjee this Court relied on the decisions of the US Court in Securities and Exchange Commission v. Chenery Corpn. [87 L Ed. 626] and Dunlop v. Bachowski [44 L Ed 2d 377] in support of its opinion discussed above.

13. Summarising the above discussion, this Court held thus:

(a) In India, the judicial trend has always been to record reasons, even in administrative decisions, if such decisions affect anyone prejudicially.

(b) A quasi-judicial authority must record reasons in support of its conclusions.

(c) Insistence on recording of reasons is meant to serve the wider principle of justice that justice must not only be done it must also appear to be done as well.

(d) Recording of reasons also operates as a valid restraint on any possible arbitrary exercise of judicial and quasi-judicial or even administrative power.

(e) Reasons reassure that discretion has been exercised by the decision-maker on relevant grounds and by disregarding extraneous considerations.

(f) Reasons have virtually become as indispensable a component of a decision-making process as observing principles of natural justice by judicial, quasi-judicial and even by administrative bodies.

(g) Reasons facilitate the process of judicial review by superior courts.

(h) The ongoing judicial trend in all countries committed to rule of law and constitutional governance is in favour of reasoned decisions based on relevant facts. This is virtually the lifeblood of judicial decision-making justifying the principle that reason is the soul of justice.

(i) Judicial or even quasi-judicial opinions these days can be as different as the judges and authorities who deliver them. All these decisions serve one common purpose which is to demonstrate by reason that the relevant factors have been objectively considered. This is important for sustaining the litigants' faith in the justice delivery system.

(j) Insistence on reason is a requirement for both judicial accountability and transparency.

(k) If a judge or a quasi-judicial authority is not candid enough about his/her decision-making process then it is impossible to know whether the person deciding is faithful to the doctrine of precedent or to principles of incrementalism.

(l) Reasons in support of decisions must be cogent, clear and succinct. A pretence of reasons or rubber-stamp reasons is not to be equated with a valid decision-making process.

(m) It cannot be doubted that transparency is the sine qua non of restraint on abuse of judicial powers. Transparency in decision-making not only makes the judges and decision-makers less prone to errors but also makes them subject to broader scrutiny. (See David Shapiro in Defence of Judicial Candor.)

(n) Since the requirement to record reasons emanates from the broad doctrine of fairness in decision-making, the said requirement is now virtually a component of human rights and was considered part of Strasbourg Jurisprudence. See Ruiz Torija v. Spain EHRR, at 562 para 29 and Anya v. University of Oxford, wherein the Court referred to Article 6 of the European Convention of Human Rights which requires, adequate and intelligent reasons must be given for judicial decisions.

(o) In all common law jurisdictions judgments play a vital role in setting up precedents for the future. Therefore, for development of law, requirement of giving reasons for the decision is of the essence and is virtually a part of due process."

14. Indisputably, no reasons have been assigned in the impugned order, except stating that,-

“The Standing Counsel for the second respondent submits that the functional operation of the Kerala Head Load Workers (Regulation of Employment and Welfare) Scheme, 1983 has not been extended to the area where the establishment of the petitioner is situated.

In the circumstances, there will be an interim order as prayed for.”

15. True, there is a discretion in exercise of the power of the writ court in granting interim orders. Let us consider a few decisions as to how discretion has to be exercised by the executive and quasi judicial or by the judicial officers.

(i) In Suman Gupta and others v. State of Jammu and Kashmir and others reported in (1983) 4 SCC 339, the Hon'ble Supreme Court while explaining as to how administrative discretion should be exercised, at paragraph No.6, held as follows:

"The exercise of all administrative power vested in public authority must be structured within a system of controls informed by both relevance and reason - relevance in relation to the object which it seeks to serve, and reason in regard to the manner in which it attempts to do so. Wherever the exercise of such power affects individual rights, there can be no greater assurance protecting is valid exercise than its governance by these twin tests. A stream of case law radiating from the now well known decision in this Court in Maneka Gandhi v. Union of India reported in (1978) 1 SCC 248 has laid down in clear terms that Article 14 of the Constitution is violated by powers and procedures which in themselves result in unfairness and arbitrariness. It must be remembered that our entire constitutional system is founded in the rule of law, and in any system so designed it is impossible to conceive of legitimate power which is arbitrary in character and travels beyond the bounds of reason.

In the above reported judgment, the Hon'ble Apex Court further held that,

"We do not doubt that in the realm of administrative power the element of discretion may properly find place, where the statute or the nature of the power intends so. But there is a well recognised distinction between an administrative power to be exercised within defined limits in the reasonable discretion of designated authority and the vesting of an absolute and uncontrolled power in such authority. One is power controlled by law countenanced by the Constitution, the other falls outside the Constitution altogether."

(ii) Reiterating as to how the discretionary power has to be exercised, the Hon'ble Supreme Court in Sant Raj and another v. O.P.Singla and others reported in (1985)2 SCC 349, held that,-

"whenever, it is said that something has to be done, within the discretion of the authority, then that something has to be done, according to the rules of reason and justice and not according to private opinion, according to law and not humour. It is to be not arbitrary, vague and fanciful but legal and regular and it must be exercised within the limit to which an honest man to the discharge of his office ought to find himself. Discretion means sound discretion guided by law. It must be governed by rule, not by humour, it must not be arbitrary, vague and fanciful.

(iii) In Fasih Chaudhary v. Director General, Doordarshan and others reported in 1989 1 SCC 89, the Hon'ble Supreme Court held that exercise of discretion should be legitimate, fair and without any aversion, malice or affection. Nothing should be done which may give the impression of favouritism or nepotism. While fair play in action in such matters is an essential requirement, free play in the joints is also a necessary concomitant for an administrative body functioning in an administrative sphere or quasi-administrative sphere as the present one.

16. It is trite law that courts or quasi judicial authorities are conferred with a discretion to pass appropriate orders on the issues raised and required to be adjudicated. But the courts or quasi judicial authorities, as the case may be, are bound to consider as to how the discretion conferred should be exercised. Let us consider a few decisions on the said aspect.

“(i) While considering, a litigation arising out of Bangalore Development Authority Act, 1976, the Hon'ble Supreme Court in Bangalore Medical Trust v. B.S.Muddappa and others reported in (1991) 4 SCC 54, held that,-

"Discretion is an effective tool in administration. It provides an option to the authority concerned to adopt one or the other alternative. But a better, proper and legal exercise of discretion is one where the authority examines the fact, is aware of law and then decides objectively and rationally what serves the interest better. When a statute either provides guidance or rules or regulations are framed for exercise of discretion then the action should be in accordance with it. Even where statutes are silent and only power is conferred to act in one or the other manner, the Authority cannot act whimsically or arbitrarily. It should be guided by reasonableness and fairness. The legislature never intends its authority to abuse the law or use it unfairly. Where the law requires an authority to act or decide, 'if it appears to it necessary' or if he is 'of opinion that a particular act should be done' then it is implicit that it should be done objectively, fairly and reasonably. In a democratic set up the people or community being sovereign the exercise of discretion must be guided by the inherent philosophy that the exerciser of discretion is accountable for his action. It is to be tested on anvil of rule of law and fairness or justice particularly if competing interests of members of society is involved. Decisions affecting public interest or the necessity of doing it in the light of guidance provided by the Act and rules may not require intimation to person affected yet the exercise of discretion is vitiated if the action is bereft of rationality, lacks objective and purposive approach. Public interest or general good or social betterment have no doubt priority over private or individual interest but it must not be a pretext to justify the arbitrary or illegal exercise of power. It must withstand scrutiny of the legislative standard provided by the statute itself. The authority exercising discretion must not appear to be impervious to legislative directions. The action or decision must not only be reached reasonably and intelligibly but it must be related to the purpose for which power is exercised. No one howsoever high can arrogate to himself or assume without any authorisation express or implied in law a discretion to ignore the rules and deviate from rationality by adopting a strained or distorted interpretation as it renders the action ultra virus and bad in law.”

(ii) In Shiv Sagar Tiwari v. Union of India and others reported in 1997 1 SCC 444 the Hon'ble Supreme Court held that the discretionary power has to be exercised to advance the performance, to subserve for which the power exists.

(iii) In Rakesh Kumar v. Sunil Kumar reported in (1999) 2 SCC 489, the Hon'ble Supreme Court has held that administrative action/quasi-judicial function is the duty of the authority to give reasons/record reasons/and it should be a speaking order.

(iv) In A.P. Aggarwal v. Govt. of NCT of Delhi reported in (2000) 1 SCC 600, the Hon'ble Supreme Court held as under:

"The conferment of power together with a discretion which goes with it to enable proper exercise of the power and therefore it is coupled with a duty to shun arbitrariness in its exercise and to promote the object for which the power is conferred which undoubtedly is public interest and not individual or private gain, whim or caprice of any individual."

(v) In State of NCT of Delhi v. Sanjeev, reported in (2005) 5 SCC 181, the Hon'ble Supreme Court explaining the scope of judicial review of executive action has held as follows:

"15. One of the points that falls for determination is the scope for judicial interference in matters of administrative decisions. Administrative action is stated to be referable to broad area of governmental activities in which the repositories of power may exercise every class of statutory function of executive, quasi-legislative and quasi-judicial nature. It is trite law that exercise of power, whether legislative or administrative, will be set aside, if there is manifest error in the exercise of such power or the exercise of the power is manifestly arbitrary (see State of U.P. v. Renusagar Power Co.). At one time, the traditional view in England was that the executive was not answerable where its action was attributable to the exercise of prerogative power. Professor de Smith in his classical work Judicial Review of Administrative Action, 4th Edn. at pp.285-87 states the legal position in his own terse language that the relevant principles formulated by the courts may be broadly summarised as follows:

The authority in which discretion is vested can be compelled to exercise that discretion, but not to exercise it in any particular manner. In general, discretion must be exercised only by the authority to which it is committed. That authority must genuinely address itself to the matter before it; it must not act under the dictates of another body or disable itself from exercising discretion in each individual case. In the purported exercise of its discretion, it must not do what it has been forbidden to do, nor must it do what it has not been authorised to do. It must act in good faith, must have regard to all relevant considerations and must not be influenced by irrelevant considerations, must not seek to promote purposes alien to the letter or to the spirit of the legislation that gives it power to act, and must not act arbitrarily or capriciously. These several principles can conveniently be grouped in two main categories: (i) failure to exercise a discretion, and (ii) excess or abuse of discretionary power. The two classes are not, however, mutually exclusive. Thus, discretion may be improperly fettered because irrelevant considerations have been taken into account, and where an authority hands over its discretion to another body it acts ultra vires.

(vi) In Indian Railway Construction Co. Ltd. v. Ajay Kumar reported in (2003) 4 SCC 579, at paragraphs No.13 to 15, the Hon'ble Supreme Court explained the manner in which discretionary power has to be exercised, while discharging an administrative function. In the above judgment, the Hon'ble Supreme Court held that in matters relating to administrative functions, if a decision is tainted by any vulnerability as such illegality, irrationality and procedural impropriety, Courts should not hesitate to interfere, if the action falls within any of the categories stated supra.

"14. The present trend of judicial opinion is to restrict the doctrine of immunity from judicial review to those class of cases which relate to deployment of troops, entering into international treaties etc. The distinctive features of some of these recent cases signify the willingness of the courts to assert their power to scrutinize the factual basis upon which discretionary powers have been exercised. One can conveniently classify under three heads the grounds on which administrative action is subject to control by judicial review. The first ground is 'illegality', the second 'irrationality', and the third 'procedural impropriety'. These principles were highlighted by Lord Diplock in Council of Civil Service Unions v. Minister for the Civil Service (commonly known as CCSU case). If the power has been exercised on a non-consideration or non-application of mind to relevant factors, the exercise of power will be regarded as manifestly erroneous. If a power (whether legislative or administrative) is exercised on the basis of facts which do not exist and which are patently erroneous, such exercise of power will stand vitiated. (See CIT v. Mahindra and Mahindra Ltd.) The effect of several decisions on the question of jurisdiction has been summed up by Grahame Aldous and John Alder in their book Applications for Judicial Review, Law and Practice thus:

“There is a general presumption against ousting the jurisdiction of the courts so that statutory provisions which purport to exclude judicial review are construed restrictively. There are, however, certain areas of governmental activity, national security being the paradigm, which the courts regard themselves as incompetent to investigate, beyond an initial decision as to whether the Governments claim is bona fide. In this kind of non-justiciable area judicial review is not entirely excluded, but very limited. It has also been said that powers conferred by the Royal Prerogative are inherently unreviewable but since the speeches of the House of Lords in Council of Civil Service Unions v. Minister for the Civil Service this is doubtful. Lords Diplock, Scarman and Roskill appeared to agree that there is no general distinction between powers, based upon whether their source is statutory or prerogative but that judicial review can be limited by the subject-matter of a particular power, in that case national security. Many prerogative powers are in fact concerned with sensitive, non-justiciable areas, for example, foreign affairs, but some are reviewable in principle, including the prerogatives relating to the civil service where national security is not involved. Another non-justiciable power is the Attorney-General's prerogative to decide whether to institute legal proceedings on behalf of the public interest.” (Also see Padfield v. Minister of Agriculture, Fisheries and Food)

15. The court will be slow to interfere in such matters relating to administrative functions unless decision is tainted by any vulnerability enumerated above:like illegality, irrationality and procedural impropriety. Whether the action falls within any of the categories has to be established. Mere assertion in that regard would not be sufficient.

17. Before summarizing the substance of the principles laid down therein we shall refer to the passage from the judgment of Lord Greene in Associated Provincial Picture Houses Ltd. v. Wednesbury Corpn. (KB at p.229 : All ER pp.682 H-683 A). It reads as follows:

“It is true that discretion must be exercised reasonably. Now what does that mean? Lawyers familiar with the phraseology used in relation to exercise of statutory discretions often use the word ‘unreasonable’ in a rather comprehensive sense. It has frequently been used and is frequently used as a general description of the things that must not be done. For instance, a person entrusted with a discretion must, so to speak, direct himself properly in law. He must call his own attention to the matters which he is bound to consider. He must exclude from his consideration matters which are irrelevant to what he has to consider. If he does not obey those rules, he may truly be said, and often is said, to be acting “unreasonably”. Similarly, there may be something so absurd that no sensible person could even dream that it lay within the powers of the authority. ...

In another, it is taking into consideration extraneous matters. It is unreasonable that it might almost be described as being done in bad faith; and in fact, all th

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ese things run into one another. Lord Greene also observed: (KB p.230 : All ER p.683 F-G) “... it must be proved to be unreasonable in the sense that the court considers it to be a decision that no reasonable body can come to. It is not what the court considers unreasonable. ... The effect of the legislation is not to set up the court as an arbiter of the correctness of one view over another.” (emphasis supplied) 18. Therefore, to arrive at a decision on “reasonableness” the court has to find out if the administrator has left out relevant factors or taken into account irrelevant factors. The decision of the administrator must have been within the four corners of the law, and not one which no sensible person could have reasonably arrived at, having regard to the above principles, and must have been a bona fide one. The decision could be one of many choices open to the authority but it was for that authority to decide upon the choice and not for the court to substitute its view. (vii) In Union of India v. Kuldeep Singh reported in (2004) 2 SCC 590, the Hon'ble Supreme Court while testing the correctness of the judgment rendered under the Narcotic Drugs and Psychotropic Substances Act, 1985, and the discretion to be exercised by the High Court, explained the principles governing the mode of exercise of the discretionary power for public functionaries as follows: "20. When anything is left to any person, judge or Magistrate to be done according to his discretion, the law intends it must be done with sound discretion, and according to law. In its ordinary meaning, the word "discretion" signifies unrestrained exercise of choice or will; freedom to act according to one's own judgment; unrestrained exercise of will; the liberty or power of acting without control other than one's own judgment. But, when applied to public functionaries, it means a power or right conferred upon them by law, of acting officially in certain circumstances according to the dictates of their own judgment and conscience, uncontrolled by the judgment or conscience of others. Discretion is to discern between right and wrong; and therefore, whoever hath power to act at discretion, is bound by the rule of reason and law. 21. Discretion, in general, is the discernment of what is right and proper. It denotes knowledge and prudence, that discernment which enables a person to judge critically of what is correct and proper united with caution; nice discernment, and judgment directed by circumspection; deliberate judgment; soundness of judgment; a science or understanding to discern between falsity and truth, between wrong and right, between shadow and substance, between equity and colourable glosses and pretences, and not to do according to the will and private affections of persons. 22. The word "discretion" standing single and unsupported by circumstances signifies exercise of judgment, skill or wisdom as distinguished from folly, unthinking or haste;evidently therefore a discretion cannot be arbitrary but must be a result of judicial thinking. The word in itself implies vigilant circumspection and care; therefore, where the legislature concedes discretion it also imposes a heavy responsibility. "The discretion of a judge is the law of tyrants; it is always unknown. It is different in different men. It is casual, and depends upon constitution, temper and passion. In the best it is often times caprice; in the worst it is every vice, folly, and passion to which human nature is liable," said Lord Camden, L.C.J., in Hindson and Kersey reported in (1680) 8 HOW St Tr 57. 23. If a certain latitude or liberty is accorded by a statute or rules to a judge as distinguished from a ministerial or administrative official, in adjudicating on matters brought before him, it is judicial discretion. It limits and regulates the exercise of discretion, and prevents it from being wholly absolute, capricious, or exempt from review." (viii) While testing the validity of Central Electricity Regulatory Commission (Procedure, terms and conditions for grant of trading licence and other related matters) (Amendment) Regulations, 2006, the Hon'ble Supreme Court in Global Energy Limited and another v. Central Electricity Regulatory Commission, reported in 2009 (15) SCC 570, started the judgment with an epilogue and it reads as follows: Epilogue 71.The law sometimes can be written in such subjective manner that it affects efficiency and transparent function of the Government. If the statute provides for pointless discretion to agency, it is in essence demolishing the accountability strand within the administrative process as the agency is not under obligation from an objective norm, which can enforce accountability in decision-making process. All law-making, be it in the context of delegated legislation or primary legislation, have to conform to the fundamental tenets of transparency and openness on one hand and responsiveness and accountability on the other. These are fundamental tenets flowing from due process requirement under Article 21, equal protection clause embodied in Article 14 and fundamental freedoms clause ingrained under Article 19. A modern deliberative democracy cannot function without these attributes.” 17. Though there is dispute as to whether the area falls under the Kerala Headload Workers (Regulation of Employment and Welfare) Scheme, 1983, at present, we are not delving into the issue, for the reason that, on the facts and circumstances of the instant appeal, and the decisions referred to above, we are of the view that the impugned order is liable to be set aside. 18. Mr.P.S.Appu, learned counsel for the appellants, submitted that the appellants would not engage in any activities, which would create law and order problem. Said submission is placed on record. In the light of the discussion and decisions, stated supra, writ appeal is allowed. Interim order in W.P.(C) No.30134 of 2019 dated 20.11.2019 is set aside. Writ court is requested to pass orders after affording an opportunity of being heard to all the parties.
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