Om Prakash Gupta and Bharat Petroleum Corporation Ltd. V. Union of India & others and State & others

WPMS/67/2014

AI Insights

The case revolves around a series of legal battles concerning the installation of a petrol pump on private land owned by Om Prakash Gupta, located near the Indian Military Academy (IMA) in Dehradun. Initially, Gupta purchased the land and obtained various no objection certificates (NOCs) from local authorities, including the Cantonment Board and the District Magistrate. However, the General Officer Commanding-in-Chief, Central Command, Lucknow, repeatedly rejected the application for permission to establish the petrol pump, citing security concerns related to its proximity to the IMA. Gupta challenged these decisions through multiple writ petitions, leading to a complex legal discourse on the reasonableness and arbitrariness of administrative decisions in the context of national security and public interest. The court's final decision emphasized the need for a rational and fair exercise of discretion by administrative authorities, particularly when such decisions significantly impact private rights and public welfare.

• Counselvise Citation: [2017] 140 COUNSELVISE.COM (IT) 813255 (HC-UTTARAKHAND)
• Appeal Type: Others
• Pronouncement Date: 18-12-2017
• Assessment Year: misc
• Other Referred Cases: Y. Mahaboob Sheriff & sons vs. Mysore State Transport Authority, Bangalore & others, The State of Maharashtra vs. Babulal Kriparam Takkamore & others, Union of India & another vs. G. Ganayutham, M.A. Rasheed & others vs. State of Kerala, Kasturi Lal Lakshmi Reddy vs. State of Jammu and Kashmir & another, U.P. State Road Transport Corporation & another vs. Mohd. Ismail & others, Hansraj H. Jain vs. State of Maharashtra & others
• Laws Referred To: Cantonments Act 1924
• Result in Favour of: Others
• Court: HIGH COURT
• Department Lawyers: SANJAY BHATT; P C BISHT; B S ADHIKARI
• Assessee Lawyers: RAJENDRA DOBHAL; P K CHAUHAN
• Keywords: Cantonment Board; Green Belt; Judicial review; No objection certificate; Petrol Pump Installation; Security Threat
• Section: 181(2)

Judgement Text

"Reserved Judgment IN THE HIGH COURT OF UTTARAKHAND AT NAINITAL Writ Petition (M/S) No. 67 of 2014 Om Prakash Gupta ....Petitioner Versus Union of India & others .…Respondents Mr. Rajendra Dobhal, Senior Advocate for the petitioner. Mr. Sanjay Bhatt, Standing Counsel for the Union of India/respondent nos.1, 2 and 4 Mr. P.C. Bisht, Standing Counsel for the State. Mr. B.S. Adhikari, Advocate for the respondent no.3. With Writ Petition (M/S) No. 248 of 2014 Bharat Petroleum Corporation Ltd. ....Petitioner Versus State & others .…Respondents Mr. P.K. Chauhan, Advocate for the petitioner. Mr. P.C. Bisht, Standing Counsel for the State. Mr. B.S. Adhikari, Advocate for the respondent no.3. Judgment Reserved- 06.12.2017 Date of Judgment - 18.12.2017 Hon’ble Rajiv Sharma, J Petitioner purchased bhumidhar 4 bigha land of Khasra Nos.140/1 and 140/2 situated at Village Kehri, Arkedia Grant, Prem Nagar, Dehradin on 26.05.2000 from Mrs. Anamika Agarwal and Mrs. Pushpa Garg. 2. Petitioner got the possession of the land. The mutation was attested in his favour. Petitioner submitted an application for dealership and he was interviewed on 06.12.2004. Letter of Intent was issued in favour of the petitioner on 20.12.2004. 3. Petitioner submitted an application to the Cantonment Board, Dehradun seeking permission vide application dated 18.02.2005. It was rejected on 19.02.2005. Thereafter, the petitioner filed an application on 21.02.2005, before the Executive Officer, Cantonment Board, Dehradun. The Executive Officer, Cantonment Board, Dehradun sent a communication to Principal Director, Defence Estates, Ministry of Defense, Central 2 Command, Lucknow for granting permission and relaxing the restriction for construction/installation of petrol pump over the land, in question. 4. Petitioner, in the meantime, obtained No Objection Certificates from the various agencies on 11.02.2005, 15.02.2005 and 04.05.2005. The Cantonment Board also issued No Objection Certificate on 26.07.2005 with the rider that before construction is commenced, the map would be got approved from the Cantonment Board. 5. The No Objection Certificate was also issued by District Magistrate, Dehradun on 23.08.2005. The lease agreement was entered into between the petitioner and the oil company on 07.10.2005. In the meantime, the Cantonment Board passed a resolution on 14.11.2005 declining the lifting of restrictions. The case of the petitioner was rejected on 18.03.2006 for erection of retail outlet of MS/HSD over the land, in question. 6. Petitioner has also sought information from the MDDA whether the area fell in its jurisdiction or it fell under green-belt. 7. The Public Information Officer, MDDA, Dehradun sent a communication to the petitioner on 26.04.2006 that the area under the Cantonment Board, Dehradun is neither within the jurisdiction of MDDA, Dehradun nor MDDA has sanctioned any map of the area. The restriction on the construction in the said area is imposed by the Cantonment Board, Dehradun. 8. Petitioner has challenged the letter dated 18.03.2006 by filing a Writ Petition No.693 of 2006(M/B) before this Court. The same was allowed on 20.11.2006 by the Division Bench of this Court. The impugned order 3 annexure dated 18.03.2006 was quashed and set-aside. The Division Bench has held as under:- “2. This Court vide order dated 30.10.2006 directed the District Magistrate, Dehradun to send a report relating to date of entry of Mrs. Animika Agarwal. We have perused the report sent by District Magistrate, Dehradun. It appears that the recommendation made by the Executive Officer who is the officer on spot has recommended by his letter dated 24.6.2005 to the Principal Director, Defence Estates, Ministry of Defence, CC, Lucknow Cantt. To grant relaxation for establishment of petrol filling station (MS/HSD). In the said letter, the Executive Officer has recommended that the GOC-in- Chief has partly lifted the restriction in the year 1967 from the area which is hardly 100 mts. away from I.M.A. while the petitioner’s place for establishment of petrol filing is stating is about 2½ Kms. away from I.M.A. In view of this report, it cannot be said that the establishment of this Petrol Filling Station will have any danger to the security of I.M.A. 3. In view of these circumstances, it appears that the order impugned has been passed without application of mind and the same has been passed in violation of Article 14 of Constitution of India. Hence, the order dated 18.03.2006 is liable to be set aside. 4. Accordingly, the writ petition is allowed. The order dated 18.03.2006 passed by General Officer of Commanding Headquarters, Central Command, Lucknow-respondent no.2, which is contained in Annexure 13 to the writ petition is hereby set aside. The Principal Director, Defence Estates, Ministry of Defence, CC, Lucknow Cantt. is directed to reconsider the matter in dispute in the light of the report of the Execution Officer dated 24.06.2005 within a period of two months from the date of production of certified copy of this order.” 9. The case of the petitioner was again rejected vide Annexure No.9 dated 13.02.2007. The operative portion of the letter dated 13.02.2007 reads as under:- “On reconsideration since the entire area is in the green belt on M.D.D.A. G.O.C. in C has consented to CNG outlet at the impugned land site of Sri O.P. Gupta under the provision of the Section 240 of the Cants Act 2006 which has recently has been promulgated w.e.f. 18 Dec. 2006 has would be willing to reconsider the entire case after a public notice is issued by C.E.O. Dehradun inviting view to the public to this proposal to create a CNG outlet preserve the environment and ecology of the general Area tons river alongwith the views and recommendation of C.B., and in consultation with the P.D.D.E., as provided in the revised cantt act further as per C 146 of the revised act there is a prohibition imposed on owners occupiers or lesses of premises so as to prevent air pollution beyond standard laid down under clause (G) of sub-section (1) of Section 17 of the Air Prohibition and Control of the Pollution Act, 1981, in addition the new acts also lays down, in section 233, as new requirement to make a land use plan for the Cantonment.” 4 10. Petitioner again assailed the order dated 13.02.2007 by filing a Writ Petition No.1541 of 2007(M/S). It was decided by learned Single Judge of this Court on 28.12.2007. The General Officer Commanding, Headquarters, Central Command-respondent no.2 was directed to reconsider the matter positively within a further period of eight weeks from the date of production of certified copy of the order and also as per directions of this Court given in the earlier Writ Petition No.693(M/B) of 2006 vide order dated 20.11.2006. 11. The case was again rejected by GOC-in-Chief vide Annexure No.13 dated 08.05.2008. There is a reference of Resolution No.68-2 dated 14.11.205 passed by Cantonment Board with a further averment that there should not be any change in the restrictions as imposed of the GOC-in-Chief Eastern Command in 1942 due to prevailing security scenario at that time. The relaxation was declined. 12. Petitioner has also obtained letters from IMA dated 14.11.2005 and 20.11.2012, whereby the IMA has categorically stated that the installation of the Petrol Pump outlet over the land, in question would not affect the IMA. 13. Petitioner also filed Contempt Application No.104 of 2008. Thereafter, the petitioner was constrained to file yet another Writ Petition No.919 of 2009(M/S). It was allowed on 30.03.2010 and the order dated 08.05.2008 was quashed and set-aside. Respondent no.2 was directed to reconsider the matter afresh in the light of the observations made in the body of this judgment coupled with the no objection letter of IMA and the observations made by the Division Bench of this Court in the earlier judgments. The relevant portion of the judgment reads as under:- “16. Undisputedly, it is the third round of litigation. It is an admitted fact that the restrictions imposed under Section 5 181(2) of the Cantonments Act 1924 can only be relaxed by the General Officer Commanding-in-Chief Central Command in the present matter. It is also not disputed that this Court vide order date 28-12-2007 passed in WPMS No. 1541 of 2007 had directed the General Officer Commanding, Headquarter, Central Command, Lucknow to reconsider the matter as per direction of this Court given in Writ Petition No. 693(M/B) of 2006 vide order dated 20-11-2006. 17. Whether there is any security threat to the Indian Military on account of installation of MS/HSD retail outlet is concerned, the Indian Military Academy, Dehradun by its letter dated 14-11-2005 addressed to HQ Uttaranchal Sub Area, Dehradun Cantt. has already given its no objection to the proposed BPCL outlet at Premnagar, Dehradun. Copy of this letter has been placed on record as Annexure RA-1 to the rejoinder affidavit filed by the petitioner. The entire letter reads as under:- “PROPOSED BPCL OUTLET AT PREMNAGAR: DEHRADUN 1. Ref our letter No 126901/Gen/I: dt 21 Oct 05. 2. On verifying records, it has been found that Khasra Nos 140/1 and 140/2 is private land and is about 2.0 KM from IMA MT. The proposal has been cleared by the Cantt Bd. Dehradun. 3. In view of the above this office has no objection on the a/m matter. Our letter mentioned at Para I may please be cancelled.” 18. Having considered the contentions of the learned counsel for the petitioner as well as the learned counsel for the respondents and having gone through the averments made in the memo of writ petition along with its annexures, the counter affidavit filed on behalf of respondent no.3 and the rejoinder affidavit filed by the petitioner, it is crystal clear that while passing the impugned order dated 8-5-2008, the General Officer Commanding-in-Chief Central Command Lucknow lost sight that the Division Bench of this Court had directed to reconsider the matter in dispute in the light of the report of Executive Officer dated 24-6-2005. Moreover, it had also been observed by the Division Bench of this Court that it cannot be said that the establishment of the petrol filling station will have any danger to the security of I.M.A. Admittedly the order dated 20-11-2006 passed by the Division Bench of this Court had not been challenged before the Apex Court and the same had attained finality. Admittedly the proposed site is at a distance of not less than 2 kms. from the IMA MT and the Indian Military Academy itself has no objection to the proposed BPCL retail outlet at Prem Nagar (Dehradun Cantonment). 19. For the reasons and discussion above, the impugned order dated 8-5-2008 passed by the General Officer Commanding-in- Chief Central Command, Lucknow is liable to be set aside and the writ petition deserves to be allowed. 20. The writ petition is allowed. The impugned order dated 8-5- 2008 (Annexure-13 to the petition) is set aside. The respondent no.2 is directed, by a writ of mandamus, to reconsider the matter afresh in the light of the observations made in the body of this judgment coupled with the no objection letter of the I.M.A. (Annexure-RA-1 to the rejoinder affidavit and the observations made by the Division Bench of this Court, referred to above, within a period of eight weeks from the date of production of certified copy of this order and to grant relaxation to the restrictions imposed under Section 181(2) of the Cantonments Act 1924 and to permit the petitioner to install 6 the proposed MS/HSD BPCL outlet in the Cantonment Area on his private land of plot no. 140/1 and 140/2.” 14. Thereafter, the case of the petitioner was again rejected on 15.06.2010 vide Annexure No.17. 15. The petitioner has obtained NOC from the Executive Engineer, National Highway, Public Works Department Roorkee on 06.11.2013. The District Magistrate, Dehradun has sent a letter to Joint Chief Explosive Controller, Petroleum and Explosive Security Institute, Agra, U.P. on 21.11.2013. The Joint Chief Controller of Explosive granted the permission to BPCL for installation of Petrol Outlet on 25.11.2013. Petitioner started running the petrol pump on 04.12.2013 by constructing the boundary wall. The Chief Executive Officer, Cantonment Board, Dehradun sent a letter to the District Magistrate, Dehradun referring the order dated 15.06.2010 that the permission has been declined by GOC- in-Chief on 30.03.2010. The District Magistrate, Dehradun sent the information to Joint Chief Explosive Controller and Manager (Sales) Bharat Petroleum Corporation Meerut informing him that the NOC granted by District Magistrate, Dehradun be treated as cancelled. 16. The counter affidavits have been filed by the respondents. The gist of the counter affidavit filed by respondent nos.1, 2, 4 and 6 is that the case of the petitioner could not be considered for relaxing the restriction, in view of notification issued on 10.01.1942 under section 181(2) of the Cantonment Act. The respondents were directed to file the supplementary affidavit placing on record the notification and map. The map and notification dated 10.01.1942 and sanctioning letter dated 16.01.1942 have been placed on record. The letter dated 16.01.1942 reads as under:- 7 “In exercise of my powers under Section 181(2) of the Cantonment Act, 1924 (II of 1924), I hereby sanction the Scheme of the Cantonment Board, Dehradun for the prohibition of the erection or re-erection of buildings, other than those buildings which may at any time be permitted by me by order in writing to the erected or re-erected, in the areas bounded by the Red line on the plan attached to this order.” 17. What emerges from the facts enumerated hereinabove is that the petitioner was granted permission by Cantonment Board on 26.07.2005 with certain conditions. Petitioner has also obtained NOC from the District Magistrate, Dehradun on 23.08.2005. Petitioner has entered into lease with the oil company on 07.10.2005. The case of the petitioner was rejected on 18.03.2006 purportedly on the ground that the area was declared green belt by MDDA and the District Magistrate, Dehradun has only given provisional NOC, subject to the terms of Cantonment Board, Dehradun. Respondents were directed to reconsider the case of the petitioner vide judgment dated 20.11.2006. The case of the petitioner was again rejected on 13.02.2007, which led to the filing of Writ Petition No. 1541 of 2007. It was allowed on 28.12.2007. The case of the petitioner was again rejected, which led to the filing of Writ Petition No.919 of 2009. It was allowed on 30.03.2010. The concern shown by the respondent nos.1, 2, 4 and 6 is that there was security threat to the IMA. The Indian Military Academy has already sent the communication to the petitioner vide letters dated 14.11.2005 and 20.11.2012 that it has no objection, in case, the petrol pump is constructed at Prem Nagar, Dehradun. The Division Bench of this Court has observed in earlier judgment that the establishment of Petrol Filling Station will not have any danger to the security of IMA. The judgment passed by the Division Bench of this Court dated 20.11.2006 had attained finality. The petrol pump is situated at a distance of more than 2 Kms. from IMA. The Court has gone through the map placed on record by way of supplementary 8 affidavit. It is crystal clear from the map that beyond IMA, there is buffer zone between IMA and the site i.e. Prem Nagar. There is Law College, Gurudwara and a wedding point Chakrata Road in close proximity of the site. Since there is a buffer zone between the site of petrol pump and IMA, hence there won’t be any security threat to IMA. The decision taken by the public authorities must be reasonable and non-arbitrary. The arbitrary decisions are violative of Article 14 of the Constitution of India. The petitioner has approached this Court repeatedly and the respondents have rejected the case of the petitioner on different grounds. The earlier case of the petitioner was rejected that it was the green belt. However, it was not the green belt and the area did not fall within the MDDA. The Cantonment Board had earlier granted permission. The District Magistrate, Dehradun has already granted the No Objection Certificate. The Joint Chief Controller of Explosive granted the permission to BPCL for installation of Petrol Outlet on 25.11.2013. The GOC-in-Chief could not over look the observations made by this Court in various judgments/orders. 18. The army itself has permitted the construction activities of a large locality at Prem Nagar adjacent to IMA. The decision taken by the GOC-in-Chief is vague and sketchy. A reference has been made that certain accidents have taken place between Indian Military Academy and Prem Nagar but no details have given thereon. It would have been different scenario in case, the petitioner was establishing the petrol pump in the vicinity of IMA. There is distance of 2.5 kilometers as noticed hereinabove between IMA and the site. The establishment of petrol pump is at a distance of more than 2½ Kms. from IMA. The petrol pump is constructed after the Prem Nagar locality. The threat to the installation must be real and not imaginary. The 9 discretion vested in authorities must be exercised in a reasonable and fair manner. It is not the case of the respondent nos.1, 2, 4 and 6 that there is no petrol pump in Dehradun town. The observation made in the impugned order dated 15.06.2010 is that the petrol pump can be used as a weapon of mass destruction. The competent authority has failed to exercise its discretion under the jurisdiction vested in it to relax the provisions, in accordance with law. 19. The respondents have also not denied the existence of Law College, Gurudwara and Wedding Point near the site where the petrol pump has been setup. The petitioner has already obtained the NOC before the installation of petrol pump from the authorities concerned including IMA etc. 20. The statutory authorities while rejecting the case of the petitioner on 15.06.2010 has also failed in taking into consideration the guidelines placed on record by the petitioner, issued on 18.05.2011. 21. The GOC-in-Chief has acted mechanically and has not applied his mind while rejecting the case of the petitioner. 22. The restrictions imposed in the year 1942, which were renewed in the year 1967 and the same have lost their efficacy with the passage of time. 23. In AIR 1960 SC 321, in the case of “Y. Mahaboob Sheriff & sons vs. Mysore State Transport Authority, Bangalore & others” and analogous matters, their Lordships of the Hon’ble Supreme Court have held that where it is the case of discretion of an authority, the Supreme Court will only quash the order and asked the authority to reconsider the matter if the discretion has not 10 been properly exercised. But in case of renewal of permit under Section 52(2) the discretion is not absolute; it is circumscribed by the provision of Section 58(1)(a), which lays down the duty on the Authority which grants a renewal to specify a period which is not less than three years and not more than five years. The duty being laid on the Authority which has in this case decided to grant the renewal to specify a period which is not less than three years and not more than five years, as directed, it was open to the Supreme Court to direct the Authority to carry out the duty laid on it by Section 58(1)(a) read with Section 58(2), when it has granted the renewal. Their Lordships have held as under:- “(10a) This brings us to the question of relief to be granted to the petitioners. It is contended on behalf of the Department that all that this Court can do is to quash the order of December 15, 1958, and send the case back to the Authority for consideration of the question of renewal afresh. On the other hand, the petitioners contend that this Court should quash the illegal condition limiting the duration of the renewal to one year and direct the Authority to specify a period of not less than three years and not more than five years in conformity with Section 58(1)(a) in the order of renewal. This raises the question of severability of a part of the order passed by the Authority. The principles on which any unconstitutional provision can be severed and struck down leaving other parts of a statute untouched were laid down by this Court in R.M.D.Chamarbaugwalla v. Union of India2 and the first principle is whether the legislature would have enacted the valid part if it had known that the rest of the statute was invalid. This principle relating to statutes was extended by this Court to orders in Shewpujanrai Indrasanrai Ltd. v. Collector of Customs3 where a part of the order of the Collector of Customs was quashed. The question therefore resolves into this: Would the Authority have ordered renewal if it knew that it could not reduce the period of a permit to below three years? Looking at the facts of these cases which we have set out earlier, it is to our mind obvious that the Authority would have granted renewal in the circumstances of these cases when it did so in December 1958. The previous permits in these cases had expired on March 31, 1958, and the petitioners had been plying their stage carriages right up to the time when the order was passed on December 15, 1958; they could not do so without a permit in view of Section 42 of the Act. Therefore, renewal in these cases was certain when the order was passed on December 15, 1958. In the circumstances it is open to us to sever the illegal part of the order from the part which is legal, namely, the grant of the renewal. 11. The next question is what order should be passed in the circumstances. This depends on the exigencies of each case, for this Court is not confined by the technical rules relating to 11 issue of writs by the English Courts. In T.C. Basappa v. T. Nagappa 4 this Court observed as follows at p. 256: “The language used in Articles 32 and 226 of our Constitution is very wide and the powers of the Supreme Court as well as of all the High Courts in India extend to issuing of orders, writs or directions including writs in the nature of habeas corpus, mandamus, quo warranto, prohibition and certiorari as may be considered necessary for enforcement of the fundamental rights and in the case of the High Courts, for other purposes as well. In view of the express provision in our Constitution we need not now look back to the early history or the procedural technicalities of these writs in English law, nor feel oppressed by any difference or change of opinion expressed in particular cases by English Judges. We can make an order or issue a writ in the nature of certiorari in all appropriate cases and in appropriate manner, so long as we keep to the broad and fundamental principles that regulate the exercise of jurisdiction in the matter of granting such writs in English law.” It is therefore upon to us to issue a direction in the nature of mandamus requiring the Authority to follow the law as laid down by this Court in respect to the order of renewal granted by it in accordance with Section 58(1)(a). It is true that where it is a case of discretion of an authority, this Court will only quash the order and ask the authority to reconsider the matter if the discretion has not been properly exercised. But in this case, the discretion is not absolute; it is circumscribed by the provision of Section 58(1)(a), which lays down a duty on the Authority which grants a renewal to specify a period which is not less than three years and not more than five years. The duty being laid on the Authority which has in this case decided to grant a renewal to specify a period not less than three and not more than five years as the duration of the renewal, it is in our opinion open to this Court to direct the Authority to carry out the duty laid on it by Section 58(1)(a) read with Section 8(2), when it has granted the renewal.” 24. In AIR 1967 SC 1353, in the case of “The State of Maharashtra vs. Babulal Kriparam Takkamore & others’, their Lordships of the Hon’ble Supreme Court have held that where an order is based on several grounds, some of which are irrelevant then if there is nothing to show that the authority would have passed the order on the basis of relevant and existing grounds that order cannot be sustained. Their Lordships have held as under:- “15. Mr Bobde contended that the opinion of the State Government was based on two grounds and as one of them is found to be non-existent or irrelevant, the order is invalid and should be set aside. The cases relied on by him may he briefly noticed. In a number of cases, the court has quashed orders of preventive detention based on several grounds one of which is found to be irrelevant or illusory. After reviewing the earlier 12 cases, Jagannadhadas, J., in Dwarka Dass Bhatia v. State of J&K3, said: “The principle underlying all these decisions is this. Where power is vested in a statutory authority to deprive the liberty of a subject on its subjective satisfaction with reference to specified matters, if that satisfaction is stated to be based on a number of grounds or for a variety of reasons, all taken together, and if some out of them are found to be non-existent or irrelevant, the very exercise of that power is bad. This is so because the matter being one for subjective satisfaction, it must be properly based on all the reasons on which it purports to be based. If some out of them are found to be non- existent or irrelevant, the court cannot predicate what the subjective satisfaction of the said authority would have been on the exclusion of those grounds or reasons. To uphold the validity of such an order in spite of the invalidity of some of the reasons or grounds would be to substitute the objective standards of the court for the subjective satisfaction of the statutory authority. In applying these principles, however, the court must be satisfied that the vague or irrelevant grounds are such as, if excluded, might reasonably have affected the subjective satisfaction the appropriate authority. It is not merely because some ground or reason of a comparatively unessential nature is defective that such an order based on subjective satisfaction can be held to be invalid. The court while anxious to safeguard the personal liberty of the individual will not lightly interfere with such orders.” In Naursinha v. State of M.P.4 the Madhya Pradesh High Court, following the principle of the preventive detention cases, held that an order of supersession of the municipality under Section 208 of the Madhya Bharat Municipalities Act, 1954, based on several grounds most of which were found to be irrelevant, was invalid. In Dhirajlal Girdharilal v. CIT5, Mahajan, C.J., said with reference to the order of an income tax Tribunal, that: “The learned Attorney-General frankly conceded that it could not be denied that to a certain extent the Tribunal had drawn upon its own imagination and had made use of a number of surmises and conjectures in reaching its result. He, however, contended that eliminating the irrelevant material employed by the Tribunal in arriving at its conclusion, there was sufficient material on which the finding of fact could be supported. In our opinion, this contention is not well founded. It is well established that when a court of facts acts on material, partly relevant and partly irrelevant, it is impossible to say to what extent the mind of the court was affected by the irrelevant material used by it in arriving at its finding. Such a finding is vitiated because of the use of inadmissible material and thereby an issue of law arises.” In State of Orissa v. Bidvabhushan Mahapatra6 an Administrative Tribunal in a disciplinary proceeding against a public servant found the second charge and four out of the five heads under the first charge proved and recommended his dismissal. The Governor after giving him a reasonable opportunity to show cause against the proposed punishment 13 dismissed him. The High Court held that the findings on two of the heads under the first charge could not be sustained as in arriving at those findings the Tribunal had violated Rules of natural justice. It held that the second charge and only two heads of the first charge were established and directed the Governor to reconsider whether on the basis of these charges the punishment of dismissal should be maintained. On appeal, this Court set aside the order of the High Court. In the course of the judgment, Shah, J., observed: “If the High Court is satisfied that if some but not all of the findings of the Tribunal were ‘unassailable’, the order of the Governor on whose powers by the Rules no restrictions in determining the appropriate punishment are placed, was final, and the High Court had no jurisdiction to direct the Governor to review the penalty, for as we have already observed the order of dismissal passed by a competent authority on a public servant, if the conditions of the constitutional protection have been complied with, is not justiciable. Therefore if the order may be supported on any finding as to substantial misdemeanour for which the punishment can lawfully be imposed, it is not for the court to consider whether that ground alone would have weighed with the authority in dismissing the public servant. The court has no jurisdiction if the findings of the enquiry officer or the Tribunal prima facie make out a case of misdemeanour, to direct the authority to reconsider that order because in respect of some of the findings but not all it appears that there had been violation of the Rules of natural justice.” The principle underlying these decisions appears to be this. An administrative or quasi-judicial order based on several grounds, all taken together, cannot be sustained if it be found that some of the grounds are non-existent or irrelevant, and there is nothing to show that the authority would have passed the order on the basis of the other relevant and existing grounds. On the other hand, an order based on several grounds some of which are found to be non-existent or irrelevant, can be sustained if the court is satisfied that the authority would have passed the order on the basis of the other relevant and existing grounds, and the exclusion of the irrelevant or non-existent grounds could not have affected the ultimate opinion or decision.” 25. In the instant case, the GOC-in-Chief has decided the matter on irrelevant grounds and has rejected the application without due application of mind. The decision rendered by him could not be taken in view of the facts and circumstances mentioned hereinabove. 26. In AIR 1970 SC 1789, in the case of “The Rampur Distillery and Chemical Co. Ltd. vs. Company Law Board & another”, their Lordships of the Hon’ble Supreme Court have held that for investment of power in the Central 14 Government under Section 326 carried with it a duty to act judicially: i.e. to hold any enquiry in a manner consistent with rules of natural justice. Their Lordships have held as under:- “11. The Solicitor-General appearing for the Union of India contended that by the use of the expression “in its opinion” occurring in SSction 326(2)(b) of the Companies Act, it is meant that the subjective satisfaction of the Central Government is determinative of the question whether the proposed person is fit and proper to be appointed managing agent, and if the Board reached the conclusion (as it has done in the present case on considerations which are not irrelevant) that Govan Brothers is not a fit and proper person to be appointed managing agent, the decision based on the satisfaction cannot be challenged before the High Court. The argument is that the existence of the satisfaction as well as the decision reached on that satisfaction are immune from the scrutiny of the Court. We are unable to agree. By sub-section (2) of Section 326 of the Companies Act, the Central Government, is invested with power to decide whether it is against the public interest to allow the Company to have a managing agent, whether the person proposed is fit and proper to be appointed or re-appointed managing agent, whether the conditions of the managing agency agreement proposed are fair and reasonable, and whether the managing agent proposed has fulfilled the conditions which the Central Government has required him to fulfil. Investment of that power carries with it a duty to act judicially: i.e. to hold an enquiry in a manner consistent with rules of natural justice, to consider all relevant matters, to ignore irrelevant matters, and to reach a conclusion without bias, without predilection and without prejudice. The satisfaction contemplated by Section 326 must, therefore, be the result of an objective appraisal of the relevant materials. The reason is clear. By Section 326 several restrictions upon the power of the Companies and individuals to carry on business, are imposed in the interest of the share-holders, the creditors, and in the larger interests of the public. The order made by the Central Government under Section 326 may result in serious detriment of the Company and the proposed managing agent, but in the larger public interest, if it is valid, they have to suffer it. Exercise of the power conferred upon the Central Government is restrictive of valuable rights of the Company and of the proposed managing agent, and severely restricts the liberty of contract. 12. The scheme of the section implies investigation and a decision on the matters set out therein. Section 326 lays down conditions by sub-section (1)(a) in which the Central Government may override the resolution of the general body of share-holders in certain specified conditions. Upon the Central Government is imposed a duty not to accord approval to the appointment or re-appointment of a proposed managing agent in the light of clauses (a), (b) and (c) of sub-section (2). Though the sub-section is enacted in form negative, in substance it confers power upon the Government subject to the restrictions imposed by clauses (a), (b) and (c), to refuse to accord approval. Sub-section (2) imposes upon the Central Government the duty not to accord approval to appointment or re-appointment of a proposed managing agent unless the Government is satisfied 15 that the managing agent is a fit and proper person to be appointed, that the conditions of the managing agency agreement are fair and reasonable and that the managing agent has fulfilled the conditions which the Central Government required him to fulfil. Thereby the Central Government is not made the final arbiter of the existence of the grounds on which the satisfaction may be founded. The satisfaction of the Government which is determinative is satisfaction as to the existence of certain objective facts. The recital about satisfaction may be displaced by showing that the conditions did not exist, or that no reasonable body of persons properly versed in law could have reached the decision that they did.” 27. In the instant case, the Union of India was required to act judicially after taking into consideration all the facts and circumstances of the case, more particularly, that in between IMA and where the petrol pump is situated, there is a buffer zone of 2 ½ kms. 28. In 1974 (2) SCC 687, in the case of “M.A. Rasheed & others vs. State of Kerala”, their Lordships of the Hon’ble Supreme Court have held that administrative decisions in exercise of powers even if conferred in subjective terms are to be made in good faith on relevant consideration. Their Lordships have further held that if it is established that there were no materials at all upon which the authority could form the requisite opinion, the court may infer that the authority passed an order without applying its mind. Their Lordships have held as under:- “10. Administrative decisions in exercise of powers even if conferred in subjective terms are to be made in good faith on relevant consideration. The courts inquire whether a reasonable man could have come to the decision in question without misdirecting himself on the law or the facts in a material respect. The standard of reasonableness to which the administrative body is required to conform may range from the courts’ own opinion of what is reasonable to the criterion of what a reasonable body might have decided. The courts will find out whether conditions precedent to the formation of the opinion have a factual basis. 11. In Rohtas Industries Ltd. v. S.D. Agarwala3 an order under Section 237 (b) (i) and (ii) of the Companies Act for investigation of the affairs of the company was challenged on the ground that though the opinion of the Government is subjective, the existence of the circumstances is a condition precedent to the formation of the opinion. It was contended that the Court was not precluded from going behind the recitals of the existence of such circumstances in the order, but could determine whether the circumstances did in fact exist. This Court said that if the 16 opinion of an administrative agency is the condition precedent to the exercise of the power, the relevant matter is the opinion of the agency and not the grounds on which the opinion is founded. If it is established that there were no materials at all upon which the authority could form the requisite opinion, the Court may infer that the authority passed the order without applying its mind. The opinion is displaced as a relevant opinion if it could not be formed by any sensible person on the material before him.” 29. In 1980 (4) SCC 1, in the case of “Kasturi Lal Lakshmi Reddy, represented by its partner Shri Kasturi Lal, Ward No. 4, Palace Bar, Poonch, Jammu and others vs. State of Jammu and Kashmir & another”, their Lordships have held the administrative action must be reasonable and in public interest and not arbitrary, capricious and malafide. Their Lordships have held as under:- “14. Where any governmental action fails to satisfy the test of reasonableness and public interest discussed above and is found to be wanting in the quality of reasonableness or lacking in the element of public interest, it would be liable to be struck down as invalid. It must follow as a necessary corollary from this proposition that the Government cannot act in a manner which would benefit a private party at the cost of the State; such an action would be both unreasonable and contrary to public interest. The Government, therefore, cannot, for example, give a contract or sell or lease out its property for a consideration less than the highest that can be obtained for it, unless of course there are other considerations which render it reasonable and in public interest to do so. Such considerations may be that some directive principle is sought to be advanced or implemented or that the contract or the property is given not with a view to earning revenue but for the purpose of carrying out a welfare scheme for the benefit of a particular group or section of people deserving it or that the person who has offered a higher consideration is not otherwise fit to be given the contract or the property. We have referred to these considerations only illustratively, for there may be an infinite variety of considerations which may have to be taken into account by the Government in formulating its policies and it is on a total evaluation of various considerations which have weighed with the Government in taking a particular action, that the court would have to decide whether the action of the Government is reasonable and in public interest. But one basic principle which must guide the court in arriving at its determination on this question is that there is always a presumption that the governmental action is reasonable and in public interest and it is for the party challenging its validity to show that it is wanting in reasonableness or is not informed with public interest. This burden is a heavy one and it has to be discharged to the satisfaction of the court by proper and adequate material. The court cannot lightly assume that the action taken by the Government is unreasonable or without public interest because, as we said above, there are a large number of policy considerations which must necessarily weigh with the Government in taking action and therefore the court 17 would not strike down governmental action as invalid on this ground, unless it is clearly satisfied that the action is unreasonable or not in public interest. But where it is so satisfied, it would be the plainest duty of the court under the Constitution to invalidate the governmental action. This is one of the most important functions of the court and also one of the most essential for preservation of the rule of law. It is imperative in a democracy governed by the rule of law that governmental action must be kept within the limits of the law and if there is any transgression, the court must be ready to condemn it. It is a matter of historical experience that there is a tendency in every Government to assume more and more powers and since it is not an uncommon phenomenon in some countries that the legislative check is getting diluted, it is left to the court as the only other reviewing authority under the Constitution to be increasingly vigilant to ensure observance with the rule of law and in this task, the court must not flinch or falter. It may be pointed out that this ground of invalidity, namely, that the governmental action is unreasonable or lacking in the quality of public interest, is different from that of mala fides though it may, in a given case, furnish evidence of mala fides.” 30. In 1991 (3) SCC 239, in the case of “U.P. State Road Transport Corporation & another vs. Mohd. Ismail & others”, their Lordships of the Hon’ble Supreme Court have held that the statutory discretion cannot be fettered by self- created rules or policy. Although it is open to an authority to which discretion has been entrusted to lay down the norms or rules to regulate exercise of discretion, it cannot, however, deny itself the discretion which the statute requires it to exercise in individual cases. Their Lordships have further held that the statutory discretion must be governed by the basic concepts of efficiency and effectiveness of public service must be exercised reasonably, rationally, fairly and equitably on the basis of its value judgment. Their Lordships have held as under:- “13. In the instant case, the Corporation has denied itself the discretion to offer an alternative job which the regulation requires it to exercise in individual cases of retrenchment. As earlier stated, the Managing Director has issued two circulars : (i) dated December 19, 1986 and (ii) dated March 12, 1987 directing the Regional Managers to dispense with the services of the drivers who are found to be medically unfit to drive the vehicles. It is directed in the circulars that such drivers should be paid benefits like retrenchment compensation which they are entitled to under the U.P. Industrial Disputes Act. The circulars thus leave no scope for exercising discretion to consider the individual cases of retrenched drivers for any 18 alternative job. It may be stated that the statutory discretion cannot be fettered by self-created rules or policy. Although it is open to an authority to which discretion has been entrusted to lay down the norms or rules to regulate exercise of discretion it cannot, however, deny itself the discretion which the statute requires it to exercise in individual cases. The concerned authority of the Corporation therefore, notwithstanding the said circulars are required to consider the cases of retrenched drivers for alternative jobs. 15. These are, in our opinion, extreme contentions which are not sustainable under law. There are two aspects to be borne in mind in exercising the discretion. Firstly, there are constraints within which the Corporation has to exercise its discretion. The Corporation is a public utility organisation where mediating motion is efficiency and effectiveness of public service. Efficiency and effectiveness of public service are the basic concepts which cannot be sacrificed in public administration by any statutory corporation. The Corporation has to render this public service within the resource use and allocation. It is within these constraints the Corporation has to exercise its discretion and perform its task. The second aspect relates to the manner in which statutory discretion is to be exercised. The discretion allowed by the statute to the holder of an office, as Lord Halsbury observed in Susannah Sharp v. Wakefield1 is intended to be exercised “according to the rules of reason and justice, 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 competent to the discharge of his office ought to confine himself”. Every discretion conferred by statute on a holder of public office must be exercised in furtherance of accomplishment of purpose of the power. The purpose of discretionary decision making under Regulation 17(3) was intended to rehabilitate the disabled drivers to the extent possible and within the abovesaid constraints. The Corporation therefore, cannot act mechanically. The discretion should not be exercised according to whim, caprice or ritual. The discretion should be exercised reasonably and rationally. It should be exercised faithfully and impartially. There should be proper value judgment with fairness and equity. Those drivers would have served the Corporation till their superannuation but for their unfortunate medical unfitness to carry on the driver’s job. Therefore, it would not be improper if the discretion is exercised with greater concern for and sympathetic outlook to the disabled drivers subject of course to the paramount consideration of good and efficient administration. These are some of the relevant factors to be borne in mind in exercising the discretion vested in the Corporation under Regulation 17(3).” 31. In 1993 (3) SCC 634, in the case of “Hansraj H. Jain vs. State of Maharashtra & others”, their Lordships of the Hon’ble Supreme Court have held that the public authorities and government bound to act reasonably and fairly. Their Lordships have held as under:- “28. After giving our anxious consideration to the respective contentions made by the learned counsel for the 19 parties, it appears to us that on the basis of reports of the expert Committees as indicated hereinbefore, the Government took a decision to set up a new township by acquiring large tracts of lands appertaining to 86 villages in Trans-Harbour, Panvel and Trans-Thane Creek area. In order to develop such huge urban complex, the M.R.T.P. Act was enacted and CIDCO was established. There is no manner of doubt that lot of deliberations were made by expert bodies before taking the decision to set up such huge urban complex to be known as New Bombay. It, therefore, cannot be contended with any seriousness that there was no planning for development of the acquired areas and the acquisition proceedings were initiated casually with the sole intention to peg down the prices by issuing notification under Section 4 of the Land Acquisition Act for a future project. The learned Solicitor has made submissions by drawing the attention of the Court to the finding of the Bombay High Court in the writ petitions that in view of the planning for development of the areas comprising Trans-Harbour, Panvel and Trans-Thane Creek area, price of the land in those areas started increasing. There is no difficulty in understanding the reason for such an increase in the prices because once it comes to the knowledge of the people concerned that some areas are going to be developed into a new township close to the city known as Greater Bombay, the land speculators will make all efforts in acquiring the lands in those areas so as to make substantial profit in the business of real estate. In the aforesaid circumstances, it appears to us that there was necessity to issue notification under Section 4 of the Land Acquisition Act so as to discourage the lands speculators in the area and to make the acquisition proceedings and the scheme of new township economically viable. The area proposed to be developed into New Bombay is admittedly a very large area and the lands appertained to about 86 villages. It is reasonably expected that substantial time would be required for detailed planning for the development of the area. Besides, about 25,000 objection petitions had to be disposed of against the proposed acquisition. In a project of this magnitude, substantial time is required to complete the acquisition proceedings. Even then, we are not fully satisfied that the concerned authorities had acted with such promptitude as was required of them. We are rather inclined to hold that even such a big and delicate scheme could have been given proper shape earlier and the acquisition proceedings in our view could have been completed earlier if there had been proper diligence and concerted efforts at different levels. But simply on account of the proverbial slow pace with which the public authorities move in this country, we are not inclined to hold that there had been deliberate laches and utter lack of bona fide on the part of the acquiring authorities and the sole intention to initiate acquisition proceedings by issuing notification under Section 4 of the Land Acquisition Act was to peg down the prices with a clear intention to sit over the matter for years just to deny to the land owners the reasonable price of the land. Such submission is not warranted on any firm foundation and the Bombay High Court has also not accepted such contention. 29. Before the amendment of Land Acquisition Act, there was no time-limit to complete the land acquisition proceedings. The acquiring authorities were free to initiate the land acquisition proceedings in any manner they chose and were permitted to sit over such proceedings without any just cause for years together so as to deprive the land owners of the reasonable 20 price of the land. There is no manner of doubt that the public authorities and the Government are bound to act reasonably and fairly and each action of such authorities must pass the test of reasonableness and precisely for this reason, even when there was no time-limit for completing the acquisition proceedings from the date of initiation of the proceedings by issuing notification under Section 4 of the Land Acquisition Act, the Court had, in appropriate cases, looked into the reasonableness of the action undertaken by the acquiring authority and whenever action taken was found to be lacking in bona fide and made in colourable exercise of the power, the Court did not hesitate to strike down unfair and unjust acquisition proceedings. We have, however, indicated that in the instant cases, there is no firm foundation for coming to the conclusion that the acquisition proceedings had been initiated casually without any precise objective and initiation of the acquisition proceedings by issuing notifications under Section 4 of the Land Acquisition Act was made with the sole intention to peg down the prices for acquisition in remote future, thereby causing loss and injury to the affected land owners. Despite lamentable delay in completing the acquisition proceedings in the instant cases, we are not inclined to hold that such acquisition proceedings were otherwise mala fide or invalid for the reasons indicated hereinbefore and the decisions cited by the learned counsel for the parties for striking down the acquisition proceedings are not applicable in the facts and circumstances of the cases.” 32. In 1997 (7) SCC 463, in the case of “Union of India & another vs. G. Ganayutham”, their Lordships of the Hon’ble Supreme Court have held that according to Wednesbury case, while examining ‘reasonableness’ of an administrative decision, 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. Their Lordships have held as under:- “12. This case is treated as laying down various basic principles relating to judicial review of administrative or statutory discretion. Before summarising 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.8 (KB at p. 229: All ER p. 682). 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 21 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) “… 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) 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. The CCSU case (1985) and the expectation of future adoption of proportionality 31. The current position of proportionality in administrative law in England and India can be summarised as follows: (1) To judge the validity of any administrative order or statutory discretion, normally the Wednesbury test is to be applied to find out if the decision was illegal or suffered from procedural improprieties or was one which no sensible decision-maker could, on the material before him and within the framework of the law, have arrived at. The court would consider whether relevant matters had not been taken into account or whether irrelevant matters had been taken into account or whether the action was not bona fide. The court would also consider whether the decision was absurd or perverse. The court would not however go into the correctness of the choice made by the administrator amongst the various alternatives open to him. Nor could the court substitute its decision to that of the administrator. This is the Wednesbury8 test. (2) The court would not interfere with the administrator’s decision unless it was illegal or suffered from procedural impropriety or was irrational — in the sense that it was in outrageous defiance of logic or moral standards. The possibility of other tests, including proportionality being brought into English administrative law in future is not ruled out. These are the CCSU9 principles. (3)(a) As per Bugdaycay20, Brind12 and Smith19 as long as the Convention is not incorporated into English law, the English courts merely exercise a secondary judgment to find out if the decision-maker could have, on the material before him, arrived at the primary judgment in the manner he has done. 22 (3)(b) If the Convention is incorporated in England making available the principle of proportionality, then the English courts will render primary judgment on the validity of the administrative action and find out if the restriction is disproportionate or excessive or is not based upon a fair balancing of the fundamental freedom and the need for the restriction thereupon. (4)(a) The position in our country, in administrative law, where no fundamental freedoms as aforesaid are involved, is that the courts/tribunals will only play a secondary role while the primary judgment as to reasonableness will remain with the executive or administrative authority. The secondary judgment of the court is to be based on Wednesbury and CCSU principles as stated by Lord Greene and Lord Diplock respectively to find if the executive or administrative authority has reasonably arrived at his decision as the primary authority. (4)(b) Whether in the case of administrative or executive action affecting fundamental freedoms, the courts in our country will apply the principle of “proportionality” and assume a primary role, is left open, to be decided in an appropriate case where such action is alleged to offend fundamental freedoms. It will be then necessary to decide whether the courts will have a primary role only if the freedoms under Articles 19, 21 etc. are involved and not for Article 14. Punishment in disciplinary matters: Wednesbury and CCSU tests 33. Accordingly, the writ petition is allowed. Impugned Annexure No.17 dated 15.06.2010 is quashed and set-aside. The respondents are restrained from interfering in running the petrol pump outlet over the Plot No.140/1 & 140/2 NH-72 situated at Arkedia Grant, Prem Nagar, Dehradun with costs quantified at Rs.10,000/-. 34. In view of the observations made in WPMS No.67 of 2014, the Writ Petition No.248 of 2014(M/S) has now become infructuous and the same is dismissed, as such. (Rajiv Sharma, J.) NISHANT "