IN THE HIGH COURT OF JUDICATURE AT MADRAS DATED :
18. 02.2014 CORAM THE HONOURABLE MR.JUSTICE S.MANIKUMAR Writ Petition No.4392 of 2014 and M.P.No.1 of 2014 V.Rajarethinam ... Petitioner Vs.
1. The Registrar of Co-op. Society (Housing), Nandanam, Chennai 35.
2. The Deputy Registrar of Co.op Society (Housing), Chengalpet.
3. The P.W.D. Employees Co.op Housing Society, Rep. by its Special Officer, No.10/8B V.M.Nagar, Jawaharlal Nehru Road, Tiruvallore 602 001. ... Respondents Prayer : Writ Petition filed under Article 226 of the Constitution of India praying for a Writ of certiorarified mandamus, calling for the records relating to 1st respondents proceedings made in Na.Ka.No.493/2013/r.g.1/dated 23.3.2013 and 2nd respondent's proceedings made in Na.Ka.No.3357/2005/Ka dated 30.9.2013 and quash the same and direct the respondents to revive 3rd respondent's society by admitting new members. For Petitioner : Mr.M.Muthappan For Respondents : Mr.L.P.Shanmugasundaram (for R1&2) Spl. Govt. Pleader (Coop.) Mr.EMS.Natrajan (for R3)
ORDERMr.L.P.Shanmugasundaram, learned Special Government Pleader takes notice on behalf of the respondents. Hence, notice is waived.
2. Member and the former President of P.W.D. Employees Co.op Housing Society, Tiruvellore, has filed the writ petition for a certiorarified mandamus, to call for the records relating to the proceedings in R.C.No.493/2013/r.g.1/dated 23.3.2013, rejecting the appeal dated 21.01.2013, submitted by the Society, against the proceedings, by which the Deputy Director of Co-operative Societies (Housing), Chengalpet, has ordered, for winding up of the society.
3. According to the petitioner, on 10.11.2012, after obtaining a copy of the abovesaid proceedings dated 03.06.2010, under the Right to Information Act, an appeal dated 21.01.2013, was preferred to the Registrar of Co-op. Society (Housing), Chennai, under Section 152 of the Tamilnadu Cooperative Societies Act, 1983, with a delay of 11 days. Before the disposal of the appeal, a representation dated 26.09.2012, was also given to the Deputy Registrar of Co.op Society (Housing), Chengalpet, to revive the society.
4. Vide proceedings in R.C.No.493/2013/r.g.1 dated 22.03.2013, the Registrar of Co.op Societies (Housing), Chennai, 1st respondent, has dismissed the appeal, on the ground that the same has been made belatedly. Yet another reason assigned by the appellate authority, is that, fee for filing the appeal has not been remitted.
5. The Deputy Registrar of Co-operative Societies (Housing), Chengalpet Region, has also rejected the request of the petitioner dated 26.09.2012 for revival of the society, vide order in G.L.No.10/09 K dated 30.09.2013, on the grounds that as per the statutory provisions, for a society to function, there must be a minimum of 25 members, on the date of consideration of the representation. The said order has been passed based on the report of Sub-Registrar of Co-operative Societies (Housing), Kancheepuram II Circle, dated 27.08.2013, wherein he has stated that there are only five members in the society and many of the members had already retired. As there is no provision, in the bye-laws to include the retired members also, so as to enable revival of the society, the same cannot be done, in the light of Section 142 of the Tamilnadu Co-operative Societies Act, 1983. For the abovesaid reasons, the Deputy Registrar of Co.op Society (Housing), Chengalpet, by order dated 30.09.2013, as stated supra, has rejected the request of the petitioner, for revival of the society.
6. Both the orders dated 22.03.2013, passed by the appellate authority Registrar of Co-op. Society (Housing), Chennai, the 1st respondent dismissing the appeal, on the grounds as stated supra and the order of the Deputy Registrar (Housing) dated 30.09.2013, rejecting, the request for revival, are under challenge in this writ petition.
7. A statutory appeal has been preferred under section 152 of the Tamilnadu Cooperative Societies Act, 1983. As per sub-section 3 of Section 152 of the Act, any appeal under sub-section (1) or sub-section(2) shall subject to the other provisions of the Act, be preferred within sixty days from the date of communication of the decision, order, award, refusal, registration or approval complained of, by the appellate authority may admit an appeal preferred after the said period of sixty days, if it is satisfied that the appellant had sufficient cause for not preferring the appeal within the said period.
8. The procedure regarding filing of appeal, is set out in Rule 169 of the Tamilnadu Co-operative Societies Rules, 1988. As per the sub rule 1(a) an appeal under sub-section (2) of Section 152 or an application for revision under sub-section (1) of Section 153 shall be either presented in person or sent by registered post to the appellate or revising authority. As per sub Rule 1(b) of Rule 169, the fee payable in respect of the appeal or application for revision shall be the rates as specified in the Schedule-III.
9. At this juncture, Mr.M.Muthappan, learned counsel for the petitioner invited the attention of this Court to schedule-iv and submitted that the fee prescribed under the schedule is only Rs.5. Whereas, the petitioner has affixed fee for Rs.10/-.
10. As per sub-rule 6 of Rule 169 of the Tamilnadu Co-operative Societies Rules, 1988, stated supra, if an appeal or application for revision prima facie appears to be not in order or does not contain the particulars required under sub-rule (3), the appellate authority or revising authority may return such appeal or application for revision indicating the reasons therefor and calling upon the appellant or the applicant for revision to remedy the defects, if any, or furnish such additional information as may be necessary and present again the appeal or application for revision within a period of 15 days from the date of the communication.
11. Reverting back to the facts on hand, perusal of the order of the Registrar of Co-operative Societies (Housing), Chennai, the 1st respondent in R.C.No.493/2013/r.g.1/dated 23.3.2013, dismissing the appeal does not reflect as to what exactly is the fee required to be paid by the petitioner, when the appeal was presented. The copy of the appeal, enclosed at page No.39 of typed set of papers indicates, affixture of Rs.10/- fee.
12. In the light of sub-rule (6) of Rule 169, if there was any defect in the presentation of the appeal, regarding non payment of fee or any declaration, the Registrar of Co-operative Societies (Housing), Chennai, the 1st respondent could have returned the appeal papers for rectification, prescribing a period of 15 days from the date of communication. The appeal as well as the condone delay application could have been returned with a direction to resubmit the same, after rectifying the defects. The normal procedure followed in quasi judicial or judicial proceedings is that, if the papers presented are not in order, it would be only returned, giving a reasonable time for rectification of the defects and after correction, the appeal or revision or any proceedings is assigned a number. Thereafter, orders are passed on the merit of such proceeding. The procedure contemplated under sub-rule (6) of Rule 169 of the Tamilnadu Co-operative Societies Rules, 1988, could have been followed. Even taking it for granted that the Registrar of Co-op. Society (Housing), Chennai, the appellate authority is empowered to consider the delay excuse petition along with the defect noticed by him, while adverting to the cause shown for the delay of 11 days in preferring the appeal as a quasi-judicial authority, the Registrar of Co-op. Society (Housing), Chennai, is required to pass a reasoned order, as to why the reasons offered by the appellant do not reflect 'sufficient cause' for condoning the delay of 11 days in preferring the appeal. The appellate authority has merely stated that the appeal has been preferred belatedly and so saying, dismissed the appeal without assigning any reasons. As reasons are the hear beat of any decision, this Court is of the view that the Registrar of Co-operative Societies (Housing), has failed to exercise the discretion conferred under sub-rule (4) of Rule 169 of the Tamilnadu Co-operative Societies Rules, 1988, in proper perspective.
13. At this juncture, this Court deems it fit to extract sub-rule (4) of rule 169, which is as follows: ".4. Where an appeal under sub-section(2) of Section 152 is preferred after the expiry of sixty days specified in sub-section (3) of the said section, it shall be accompanied by a petition supported by an affidavit setting forth the facts on which the appellant relies to satisfy the appellate authority that he had sufficient cause for not preferring the appeal within the said period of sixty days.".
14. An appeal under Section 152 if preferred after the expiry of 60 days specified in sub section 3 of the said section, it shall be accompanied by a petition, supported by an affidavit setting forth the facts to satisfy the appellate authority that he had sufficient cause, for not preferring the appeal within the said period of sixty days.
15. When discretion is conferred on the appellate authority to consider the aspect of sufficient cause for not preferring the appeal in time, exercise of such discretion should not be made arbitrarily. On the aspect of exercise of discretion by a quasi-judicial authority, this Court deems it fit to consider few decisions. (i). In Suman Gupta and others v. State of Jammu and Kashmir and others reported in (1983) 4 SCC339 the 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 SCC248has 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 judgement, the 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 Supreme Court in Sant Raj and another v. O.P.Singla and others reported in (1985)2 SCC349 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 SCC89 the 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. (iv). While considering, a litigation arising out of Bangalore Development Authority Act, 1976, the Supreme Court in Bangalore Medical Trust v. B.S.Muddappa and others reported in (1991) 4 SCC54 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. (v). In Shiv Sagar Tiwari v. Union of India and others reported in 1997 1 SCC444the Supreme Court held that the discretionary power has to be exercised to advance the performance, to subserve for which the power exists. (vi). In Rakesh Kumar v. Sunil Kumar reported in (1999) 2 SCC489 the 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. (vii) In A.P. Aggarwal v. Govt. of NCT of Delhi reported in (2000) 1 SCC600 the 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.". (viii) In State of NCT of Delhi v. Sanjeev, reported in (2005) 5 SCC181 the 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. (xi) In Indian Railway Construction Co. Ltd. v. Ajay Kumar reported in (2003) 4 SCC579 at paragraphs No.13 to 15, the Supreme Court explained the manner in which discretionary power has to be exercised, while discharging an administrative function. In the above judgment, the 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-Generals 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 these 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. (x) In Union of India v. Kuldeep Singh reported in (2004) 2 SCC590 the 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.". (xi). 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 Supreme Court in Global Energy Limited and another v. Central Electricity Regulatory Commission, reported in 2009 (15) SCC570 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.
16. The Supreme Court in Kranti Associates Private Limited and another vs Masood Ahamed Khan and Others) reported in (2010) 9 SCC496 has considered that an administrative decision, should contain reasons. It is worthwhile to extract the decisions considered in Kranthi 's case. ".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 quasi-judicial 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 SCC262.
13. In Keshav Mills Co. Ltd. v. Union of India [(1973) 1 SCC380, this Court approvingly referred to the opinion of Lord Denning in R. v. Gaming Board for Great Britain, ex p Benaim [(1970) 2 QB417 and quoted him as saying that heresy was scotched in Ridge v. Baldwin [1974 AC40"..
14. The expression speaking order was first coined by Lord Chancellor Earl Cairns in a rather strange context. The Lord Chancellor, while explaining the ambit of the writ of certiorari, referred to orders with errors on the face of the record and pointed out that an order with errors on its face, is a speaking order. (See pp. 1878-97, Vol. 4, Appeal Cases 30 at 40 of the Report).
15. This Court always opined that the face of an order passed by a quasi-judicial authority or even an administrative authority affecting the rights of parties, must speak. It must not be like the inscrutable face of a sphinx.
16. In Harinagar Sugar Mills Ltd. v. Shyam Sunder Jhunjhunwala [AIR1961SC1669, 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.
17. 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.
18. 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).
19. Again in Bhagat Raja v. Union of India [AIR1967SC1606 the Constitution Bench of this Court examined the question whether the Central Government was bound to pass a speaking order while dismissing a revision and confirming the order of the State Government 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 quasi-judicial 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.
20. In Mahabir Prasad Santosh Kumar v. State of U.P. [(1970) 1 SCC764, 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.) 21. In Travancore Rayon Ltd. v. Union of India [(1969) 3 SCC868, the 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).
22. In Woolcombers of India Ltd. v. Workers Union [(1974) 3 SCC318 this 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).
23. In Union of India v. Mohan Lal Capoor [(1973) 2 SCC836 this 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 quasi-judicial. 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).
24. In Siemens Engg. and Mfg. Co. of India Ltd. v. Union of India [(1976) 2 SCC981, this 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).
25. In Maneka Gandhi v. Union of India [(1978) 1 SCC248,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.
26. 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.) 27. In Rama Varma Bharathan Thampuram v. State of Kerala [(1979) 4 SCC782 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).
28. In Gurdial Singh Fijji v. State of Punjab [(1979) 2 SCC368 this Court, dealing with a service matter, relying on the ratio in Capoor, held that rubber-stamp reason is not enough and virtually quoted the observation in Capoor to the extent that: (Capoor case, SCC p. 854, para 28) 28. Reasons are the links between the materials on which certain conclusions are based and the actual conclusions. (See AIR p. 377, para 18.) 29. 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 SCC642. 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. 30. 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. (See AIR p. 11, para 29.) 31. In Bombay Oil Industries (P) Ltd. v. Union of India [(1984) 1 SCC141, this 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.
32. In Ram Chander v. Union of India [(1986) 3 SCC103, this 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 (SCC pp. 106-07, para 4 : AIR p. 1176, para 4).
33. In Star Enterprises v. City and Industrial Development Corpn. of Maharashtra Ltd. [(1990) 3 SCC280 a three-Judge Bench of this 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).
34. In Maharashtra State Board of Secondary and Higher Secondary Education v. K.S. Gandhi [(1991) 2 SCC716, this Court held that even in domestic enquiry if the facts are not in dispute non-recording 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).
35. In M.L. Jaggi v. MTNL [(1996) 3 SCC119, this 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. (See SCC p. 123, para 8.) 36. In Charan Singh v. Healing Touch Hospital [(2000) 7 SCC668 a three-Judge Bench of this 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.) 37. 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 [AIR1969SC414 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.) 38. About two decades thereafter, a similar question cropped up before this Court in S.N. Mukherjee v. Union of India [(1990) 4 SCC594. 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.
39. 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. 40. Our Constitution also deals with court-martial proceedings differently as is clear from Articles 33, 136(2) and 227(4) of the Constitution.
41. In England there was no common law duty of recording of reasons. In Stefan v. General Medical Council [(1999) 1 WLR1293(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. 42. Even then in R. v. Civil Service Appeal Board, ex p Cunningham [(1991) 4 All ER310(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 ER420(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). 43. The learned Master of Rolls further clarified by saying: (Civil Service Appeal Board case [(1991) 4 All. ER310(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. 44. 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 WLR2397. It has been acknowledged that this trend is consistent with the development towards openness in the Government and judicial administration.
45. In English v. Emery Reimbold and Strick Ltd. [(2002) 1 WLR2409. 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 WLR1763, 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. 46. 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.
47. Summarising the above discussion, this Court holds: (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.".
17. In the light of the statutory provision, sub-rules (4) and (6) of Rule 169 of the Tamilnadu Co-operative Societies Rules, 1988, this Court is of the view, that the order dated 22.03.2013, passed by the Registrar, the appellate authority, rejecting the appeal, merely recording that the appeal has been filed belatedly, without any reasons, as to the sufficiency of the cause shown in the supporting affidavit to the excuse delay petition, cannot be said to be in conformity with the statutory provisions and the decisions stated supra. Therefore, this Court is inclined to set aside the order dated 22.03.2013, with a direction to the appellate authority, to pass appropriate orders in terms of sub-rule (6) of Rule 169 of the Tamilnadu Co-operative Societies Rules, 1988, giving a reasonable time of 15 days, to the petitioner to rectify the defects if any in the appeal papers and if the petitioner chooses to rectify the defects pointed out by the appellate authority, within the period prescribed, take the excuse delay petition on record, and pass a speaking order, on the sufficiency of cause shown by the appellant in not preferring the appeal within the period of 60 days. If the cause shown by the petitioner is satisfactory, delay may be condoned and that the appeal may be taken on record for disposal on merits and in accordance with law. If the appellate authority, is not satisfied, with the reasons assigned by the petitioner, for not preferring the appeal in time , then appropriate speaking orders may be passed, on the delay excuse petition.
18. As regards the challenge to the proceedings in G.L.No.10/09 K dated 30.09.2013, passed by the Deputy Registrar of Co.op Society (Housing), Chengalpet, rejecting the request for revival of the society, it could be seen that after the society was wound up by proceedings in Na.Ka.No.3357/2005 dated 03.06.2010 and before the filing of the appeal on 21.01.2013, a representation dated 22.09.2012, has been made to the Deputy Registrar of Co-operative Societies (Housing) for revival of the society. For reasons stated supra, the Deputy Registrar of Co-operative Societies (Housing), vide order dated 30.09.2013, has rejected the request. The said order is also appealable under Section 152 of the Co-operative Societies Act, within 60 days from the date of receipt of a copy of that order. There are no averments in the supporting affidavit, as to when the impugned order dated 30.09.2013, has been received.
19. In the light of Section 152 of the Tamilnadu Cooperative Societies Act, 1983 and sub-Rule 4 of Rule 169 of the Tamilnadu Co-operative Societies Rules, 1988, an appeal could still be preferred to the Registrar of Co-operative Societies (Housing), with an excuse delay petition.
20. As an alternative remedy is available to the petitioner, this Court is not inclined to entertain the challenge in so far as the order dated 30.09.2013, is concerned. However, liberty is granted to the petitioner to prefer a statutory appeal in the manner known to law. If the petitioner society chooses to prefer an appeal, as against the order dated 30.09.2013, to the Registrar of Co-operative Societies (Housing), he is directed to consider the same, as per Section 152 of the Tamilnadu Co-operative Societies Act, 1983 read with Rule S. MANIKUMAR, J.
ars 169 of the Rules framed thereunder and pass orders on merits and in accordance with law.
21. The writ petition is allowed, only to the limited extent of setting aside the order in R.C.No.493/2013/r.g.1/dated 23.3.2013, with directions as stated supra. No costs. Consequently, the connected Miscellaneous Petition is closed. 18.02.2014 Index: Yes Internet : Yes ars To 1. The Registrar of Co-op. Society (Housing), Nandanam, Chennai 35.
2. The Deputy Registrar of Co.op Society (Housing), Chengalpet.
3. The P.W.D. Employees Co.op Housing Society, Rep. by its Special Officer, No.10/8B V.M.Nagar, Jawaharlal Nehru Road, Tiruvallore 602 001 W.P. No.4392 of 2014