Imp. Rulings - Reasoned or Speaking Order (Doctrine of Audi Alteram Partem)

 Imp. Rulings - Reasoned or Speaking Order (Doctrine of Audi Alteram Partem)

Index;

1. SCI (2020.04.15) in Assistant Commissioner, Commercial Tax Department, Works Contract and Leasing Kota Vs. Shukla and Brothers.

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1). SCI (2020.04.15) in Assistant Commissioner, Commercial Tax Department, Works Contract and Leasing Kota Vs. Shukla and Brothers (SLP (C) NO. 16466 OF 2009), 2010 4 SCC 785]. has held that order passed by the administrative body and tribunals must contain a reason. In paragraph 9 to 11 of the judgment, following has been laid down:

• “# 9. The increasing institution of cases in all Courts in India and its resultant burden upon the Courts has invited attention of all concerned in the justice administration system. Despite heavy quantum of cases in Courts, in our view, it would neither be permissible nor possible to state as a principle of law, that while exercising power of judicial review on administrative action and more particularly judgment of courts in appeal before the higher Court, providing of reasons can never be dispensed with. The doctrine of audi alteram partem has three basic essentials. Firstly, a person against whom an order is required to be passed or whose rights are likely to be affected adversely must be granted an opportunity of being heard. Secondly, the concerned authority should provide a fair and transparent procedure and lastly, the authority concerned must apply its mind and dispose of the matter by a reasoned or speaking order. This has been uniformly applied by courts in India and abroad.

• # 10. The Supreme Court in the case of S.N. Mukherjee v. Union of India [JT 1990 (3) SC 630: 1990 (4) SCC 594], while referring to the practice adopted and insistence placed by the Courts in United States, emphasized the importance of recording of reasons for decisions by the administrative authorities and tribunals. It said ‘administrative process will best be vindicated by clarity in its exercise’. To enable the Courts to exercise the power of review in consonance with settled principles, the authorities are advised of the considerations underlining the action under review. This Court with approval stated:

• “……the orderly functioning of the process of review requires that the grounds upon which the administrative agency acted be clearly disclosed and adequately sustained.”

• # 11. In exercise of the power of judicial review, the concept of reasoned orders/actions has been enforced equally by the foreign courts as by the courts in India. The administrative authority and tribunals are obliged to give reasons, absence whereof could render the order liable to judicial chastise. Thus, it will not be far from absolute principle of law that the Courts should record reasons for its conclusions to enable the appellate or higher Courts to exercise their jurisdiction appropriately and in accordance with law. It is the reasoning alone, that can enable a higher or an appellate court to appreciate the controversy in issue in its correct perspective and to hold whether the reasoning recorded by the Court whose order is impugned, is sustainable in law and whether it has adopted the correct legal approach. To sub-serve the purpose of justice delivery system, therefore, it is essential that the Courts should record reasons for its conclusions, whether disposing of the case at admission stage or after regular hearing.”

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