REPORTABLE IN THE SUPREME COURT OF INDIA CIVIL APPELLATE JURISDICTION

CIVIL APPEAL NO. 4222 OF 2008 ARISING OUT OF

SPECIAL LEAVE PETITION (CIVIL) NO. 5950 OF 2007

HARYANA FINANCIAL CORPORATION & ANR. … APPELLANTS

VERSUS

KAILASH CHANDRA AHUJA … RESPONDENT

J U D G M E N T C.K. THAKKER, J.

1. Leave granted.

2. The  Haryana  Financial  Corporation

(hereinafter referred to as ‘the Corporation’),

being aggrieved by the decision of the High

Court of Punjab & Haryana dated November 6,

2006 in Civil Writ Petition No. 8299 of 2005

has  approached  this  Court.  According  to  the

appellant, the order passed by the High Court

is not in consonance with law laid down by this

Court  in  several  cases,  particularly,  a

decision  of  the  Constitution  Bench  of  this

Court in  Managing Director, ECIL, Hyderabad &

Ors. V. B. Karunakar & Ors., (1993) 4 SCC 727.

3. To appreciate the grievance voiced by

the  Corporation,  few  relevant  facts  may  be

stated;

4. The respondent herein (writ petitioner

before the High Court) Kailash Chandra Ahuja

was  appointed  as  Technical  Officer  in  the

Corporation  in  June,  1979.  According  to  the

appellant-Corporation, he was given ‘warning’

in  1984.  In  1993,  he  was  working  as  Deputy

General Manager. In 1997, he was reprimanded.

On August 17, 1999, he was working as Branch

Manager  at  Branch  Office,  Rewari.  The

Corporation initiated proceedings against the

writ-petitioner in accordance with Regulation

41 (1) and (2) of Punjab Financial Corporation

(Staff) Regulations, 1961 (hereinafter referred

to  as  ‘the  Regulations’)  on  the  allegations

enumerated  in  the  Statement  of  Charges.  The

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statement related to commission and omission on

the  part  of  the  writ-petitioner.  The  writ-

petitioner submitted a reply on December 14,

1999.  An  Inquiry  Officer  was  appointed  who

submitted his report on December 15, 2000 and

exonerated  the  writ-petitioner  of  all  the

charges. According to the Corporation, however,

the report of the Inquiry Officer suffered from

certain  deficiencies.  Hence,  the  Managing

Director of the Corporation asked the Inquiry

Officer  vide  a  communication  dated  June  19,

2001 and sought clarification. The matter was

remanded to the Inquiry Officer with the advice

to  clarify  the  points  within  15  days.  The

Inquiry Officer called the delinquent to appear

before him on August 7, 2001. The delinquent

appeared  and participated  in the  proceedings

without any protest. The Inquiry Officer then

submitted his findings vide his report dated

September  5,  2001  holding  the  delinquent

guilty. A notice was thereafter issued by the

Managing  Director  of  the  Corporation  to  the

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delinquent  on  December  18/20,  2001  to  show

cause  why  he  should  not  be  dismissed  from

service  under  Regulation  41  (1)  (e)  of  the

Regulations. The delinquent filed his reply on

February  8,  2002.  He  was  granted  personal

hearing and was dismissed from service by a

speaking  order  dated  April  4,  2002.  The

delinquent preferred an appeal before the Board

of  Directors  of  the  Corporation  under  the

Regulations  but  the  said  appeal  was  also

dismissed  by  the  Board  by  an  order  dated

January  27, 2005.  The delinquent,  therefore,

filed  a  writ  petition  in  the  High  Court  of

Punjab & Haryana which, as stated above, was

allowed by the High Court setting aside the

order  dated  April  4,  2002  passed  by  the

Corporation.  It  is  this  order  which  is

challenged by the Corporation in the present

appeal.

5. Notice  was  issued  by  this  Court  on

April 9, 2007. The respondent-writ petitioner

appeared through an advocate and waived service

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of notice upon him. Time was granted to file

affidavit-in-reply  as  well  as  rejoinder.

Meanwhile, the order passed by the High Court

impugned in the present appeal was also stayed.

On January 10, 2008, the Registry was directed

to place the matter for final hearing on a non-

miscellaneous  day.  The  matter  thus  has  been

placed for final disposal before us.

6. We have heard learned counsel for the

parties.

7. The  learned  counsel  for  the

Corporation submitted that as is clear from the

order passed by the High Court, the respondent-

writ  petitioner  had  raised  a  “short  issue”

before the Court. It was contended that the

Disciplinary Authority  i.e. Managing Director

did not furnish a copy of the inquiry report

before recording a finding that he had accepted

the finding of guilt recorded by the Inquiry

Officer in his inquiry report dated September

5,  2001.  According  to  the  learned  counsel,

supply of inquiry report after the respondent

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had been found guilty by the Inquiry Officer

was mandatory, in view of the fact that the

writ-petitioner  had  been  exonerated  by  the

Inquiry Officer earlier vide his report dated

December 15, 2000. Reliance in this connection

was placed by the learned counsel for the writ-

petitioner  on B.  Karunakar,  as  on  also  two

decisions of the High Court of Punjab & Haryana

in  M.S.  Sandhu  v.  Haryana  Vidyut  Parsaran

Nigam Ltd., (2005) 4 SCT 628 and Ramesh Kumar

v. State of Haryana & Ors., (2006) 3 SCT 799. 8. On  behalf  of  the  Corporation,  the

learned  counsel  contended  that  there  was  no

whisper in the writ petition that any prejudice

had  been  caused  to  the  case  of  the  writ

petitioner which was required to be shown as

per the ratio laid down in B. Karunakar cited

by the counsel for the writ-petitioner. It was

urged that it is only in those cases where a

Court or Tribunal comes to the conclusion that

non-supply of the report of the Inquiry Officer

had caused prejudice to the delinquent that it

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would  vitiate  the  action.  If,  on  the  other

hand, non-supply of report would have made ‘no

difference’  to  the  ultimate  finding  and

punishment  imposed,  the  order  of  punishment

could not be interfered with. 9. The  High  Court  held  that  supply  of

report of the Inquiry Officer was an ‘essential

requirement’ and non-supply thereof resulted in

violation of principles of natural justice. It,

therefore, set aside the order of dismissal.

According to the counsel for the Corporation,

the High Court was wholly wrong in taking the

above view which is contrary to the decision of

the  Constitution  Bench  of  this  Court  in  B.

Karunakar  and  the  appeal  deserves  to  be

allowed.

10. The  learned  counsel  for  the  writ-

petitioner, on the other hand, supported the

order passed by the High Court. He contended

that the High Court was right in relying upon

various decisions referred to therein and in

setting  aside  the  order  of  punishment  by

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granting  liberty  to  the  Corporation  to  take

appropriate proceedings in accordance with law.

No  interference,  therefore,  is  called  for

against  the  said  order  in  exercise  of

discretionary jurisdiction under Article 136 of

the Constitution.

11. Having heard learned counsel for the

parties  and  having  considered  the  rival

contentions,  in  our  opinion,  the  appeal

deserves to be allowed.

12. Since  only  one  question  had  been

raised before the High Court as well as before

us, we may clarify at the outset that we are

not  entering  into  merits  of  the  matter  and

allegations  and  counter  allegations  by  the

parties.  A  limited  controversy  before  us  is

whether the High Court was right in setting

aside the order of punishment  merely on the

ground of non-supply of report of the Inquiry

Officer to the delinquent. 13. As  held  by  this  Court  in  Union  of

India & Ors. V. Mohd. Ramzan Khan, (1991) 1 SCC

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588, when Inquiring Authority and Disciplinary

Authority  is  not  one  and  the  same  and  the

Disciplinary  Authority  appoints  an  Inquiring

Authority  to  inquire  into  charges  levelled

against a delinquent-officer who holds inquiry,

finds him guilty and submits a report to that

effect to the Disciplinary Authority, a copy of

such report is required to be supplied by the

Disciplinary  Authority  to  the  delinquent-

employee  before  an  order  of  punishment  is

imposed  on  him.  It  was  also  held  that  non-

supply of report of the Inquiry Officer to a

delinquent  employee  would  be  violative  of

principles  of  natural  justice.  The  Court

observed  that  after  the  Constitution  (42nd

Amendment)  Act,  1976,  second  opportunity

contemplated  by  Article  311(2)  of  the

Constitution had been abolished, but principles

of  natural  justice  and  fair  play  required

supply of adverse material to the delinquent

who was likely to be affected by such material.

Non-supply of report of Inquiry Officer to the

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delinquent  would  constitute  infringement  of

doctrine of natural justice. In B. Karunakar, a

three Judge Bench of this Court was called upon

to consider the effect of non-supply of Inquiry

Officer’s  report  to  the  delinquent.  The

attention of the Court was invited to certain

decisions  wherein  a  different  note  had  been

struck by this Court. Reference was made in

this regard to a three Judge Bench decision of

this Court in Kailash Chander Asthana v. State

of U.P., (1988) 3 SCC 600, wherein it was held

that non-supply of the report would not ‘ipso

facto’ vitiate  the  order  of  punishment  in

absence of prejudice to the delinquent. Though

Mohd.  Ramzan  Khan  was  decided  subsequently,

Kailash Chander Asthana was not brought to the

notice of the Court. The Bench, therefore, felt

that  the  matter  should  be  placed  before  a

larger Bench and accordingly the Registry was

directed  to  place  the  papers  before  Hon’ble

Chief Justice of India so that an appropriate

action can be taken [vide Managing Director,

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ECIL  v.  B.  Karunakar,  (1992)  1  SCC  709].

Accordingly, the mater was placed before the

Constitution Bench. 14. The  Constitution  Bench  observed  that

the basic question of law which arose in the

matters was whether the report of the Inquiry

Officer appointed by the Disciplinary Authority

to hold an inquiry into the charges against the

delinquent  employee  was  required  to  be

furnished to the employee to enable him to make

representation  to  the  Disciplinary  Authority

before  such  authority  arrives  at  its  own

finding with regard to the guilt or otherwise

of the employee and the punishment, if any, to

be awarded to him. On the basis of the above

fundamental  issue,  certain  other  incidental

questions were also raised by the Constitution

Bench which included the  effect of non-supply

of Inquiry Officer’s report.

15. So far as the supply of report of the

Inquiry Officer is concerned, it was held by

the  Constitution  Bench  that  the  delinquent

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employee had a right to receive the Inquiry

Officer’s  report  and  a  denial  thereof  would

constitute breach of natural justice.

16. Speaking for the majority, Sawant J.

stated:

“Hence it has to be held that when the enquiry  officer  is  not  the disciplinary authority, the delinquent employee has a right to receive a copy of the enquiry officer’s report before the disciplinary authority arrives at its  conclusions  with  regard  to  the guilt  or  innocence  of  the  employee with  regard  to  the  charges  levelled against him. That right is a part of the employee’s right to defend himself against  the  charges  levelled  against him. A denial of the enquiry officer’s report  before  the  disciplinary authority  takes  its  decision  on  the charges,  is  a  denial  of  reasonable opportunity to the employee to prove his innocence and is a breach of the principles of natural justice”.

 (emphasis supplied)

17. The Court then considered the effect

of non-supply of Inquiry Officer’s report on

the delinquent.

18. The majority stated;

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“The next question to be answered is what  is  the  effect  on  the  order  of punishment  when  the  report  of  the enquiry  officer  is  not  furnished  to the employee and what relief should be granted  to  him  in  such  cases.  The answer  to  this  question  has  to  be relative  to  the  punishment  awarded. When  the  employee  is  dismissed  or removed from service and the inquiry is set aside because the report is not furnished  to him, in some cases the non-furnishing of the report may have prejudiced him gravely while in other cases it may have made no difference to the ultimate punishment awarded to him. Hence to direct reinstatement of the  employee  with  back-wages  in  all cases  is  to  reduce  the  rules  of justice  to  a  mechanical  ritual.  The theory  of  reasonable  opportunity  and the principles of natural justice have been evolved to uphold the rule of law and  to  assist  the  individual  to vindicate  his  just  rights.  They  are not  incantations  to  be  invoked  nor rites  to  be  performed  on  all  and sundry  occasions.  Whether  in  fact, prejudice  has  been  caused  to  the employee  or  not  on  account  of  the denial to him of the report, has to be considered  on  the  facts  and circumstances  of  each  case.  Where, therefore,  even after the furnishing of  the  report,  no  different consequence  would  have  followed,  it would be a perversion of justice to permit the employee to resume duty and to get all the consequential benefits. It amounts to rewarding the dishonest and the guilty and thus to stretching the  concept  of  justice  to  illogical

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and exasperating limits. It amounts to an  ‘unnatural  expansion  of  natural justice’  which  in  itself  is antithetical to justice”.

 (emphasis supplied)

19. Holding that it was incumbent on the

delinquent  employee  to  show  prejudice,  the

majority held that non-supply of report of the

Inquiry  Officer  to  the  delinquent  employee

would  not  by  itself  make  the  order  of

punishment null and void or non est.  

20.      The majority concluded;

“Hence, in all cases where the enquiry officer’s report is not furnished to the  delinquent  employee  in  the disciplinary  proceedings,  the  Courts and Tribunals should cause the copy of the  report  to  be  furnished  to  the aggrieved  employee  if  he  has  not already  secured  it  before  coming  to the  Court/Tribunal  and  give  the employee  an  opportunity  to  show  how his or her case was prejudiced because of  the non-supply of the report. If after  hearing  the  parties,  the Court/Tribunal comes to the conclusion that  the  non-supply  of  the  report would have made no difference to the ultimate  findings  and  the  punishment given,  the  Court/Tribunal  should  not interfere  with  the  order  of punishment. The Court/Tribunal should not mechanically set aside the order

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of punishment on the ground that the report  was  not  furnished  as  is regrettably being done at present. The courts should avoid resorting to short cuts. Since it is the Courts/Tribunals which will apply their judicial mind to the question and give their reasons for setting aside or not setting aside the order of punishment, (and not any internal  appellate  or  revisional authority), there would be neither a breach  of  the  principles  of  natural justice nor a denial of the reasonable opportunity.  It  is  only  if  the Court/Tribunal  finds  that  the furnishing  of  the  report  would  have made a difference to the result in the case  that  it  should  set  aside  the order of punishment”.

     (emphasis supplied)

21. From  the  ratio  laid  down  in  B.

Karunakar,  it  is  explicitly  clear  that  the

doctrine of natural justice requires supply of

a copy of the Inquiry Officer’s report to the

delinquent  if  such  Inquiry  Officer  is  other

than  the  Disciplinary  Authority.  It  is  also

clear  that  non-supply  of  report  of  Inquiry

Officer is in the breach of natural justice.

But it is equally clear that failure to supply

a report of Inquiry Officer to the delinquent

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employee  would  not  ipso  facto  result  in

proceedings being declared null and void and

order of punishment non est and ineffective. It

is  for  the  delinquent-employee  to  plead  and

prove that non-supply of such report had caused

prejudice  and  resulted  in  miscarriage  of

justice. If he is unable to satisfy the Court

on that point, the order of punishment cannot

automatically be set aside.

22. In  the  instant  case,  it  is  not  in

dispute  by  and  between  the  parties  either

before the High Court or before us that a copy

of  the  report  of  Inquiry  Officer  was  not

supplied  to  the  delinquent-writ-petitioner.

While the contention of the writ petitioner is

that since failure to supply Inquiry Officer’s

report  had  resulted  in  violation  of  natural

justice and the order was, therefore, liable to

be quashed, the submission on behalf of the

Corporation is that no material whatsoever has

been placed nor a finding is recorded by the

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High  Court  that  failure  to  supply  Inquiry

Officer’s report had resulted in prejudice to

the delinquent and the order of punishment was,

therefore, liable to be quashed.

23. The High Court, unfortunately, failed

to  appreciate  and  apply  in  its  proper

perspective  the  ratio  laid  down  in  B.

Karunakar, though the High Court was conscious

of the controversy before it. The Court also

noted the submission of the Corporation that

there was ‘no whisper’ in the writ petition

showing  any  prejudice  to  the  delinquent  as

required by B. Karunakar, but allowed the writ

petition and set aside the order of punishment

observing  that  in  such  cases,  prejudice  is

‘writ large’.

24. In our considered view, the High Court

was wrong in making the above observation and

virtually  in  ignoring  the  ratio  of  B.

Karunakar that prejudice should be shown by the

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delinquent. To repeat, in  B. Karunakar,  this

Court stated;

“Whether in fact, prejudice has been caused  to  the  employee  or  not  on account of the denial to him of the report,  has to be considered on the facts and circumstances of each case”.

25. It is settled law that principles of

natural justice have to be complied with. One

of the principles of natural justice is  audi

alteram partem (“Hear the other side”). But it

is  equally  well  settled  that  the  concept

‘natural justice’ is not a fixed one. It has

meant  many  things  to  many  writers,  lawyers,

jurists  and  systems  of  law.  It  has  many

colours,  shades,  shapes  and  forms.  Rules  of

natural justice are not embodied rules and they

cannot be imprisoned within the strait-jacket

of a rigid formula.

26. Before about six decades, in Russel v.

Duke of Norfolk,  (1949) 1 AllER 109 : 65 TLR

225, Tucker, L.J. stated:

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“There are, in my view, no words which are of universal application to every kind  of  inquiry  and  every  kind  of domestic tribunal. The requirements of natural  justice  must  depend  on  the circumstances of the case, the nature of the inquiry, the rules under which the tribunal is acting, the subject- matter that is being dealt with, and so forth”.

27. In the oft-quoted passage from  Byrne

v.  Kinematograph  Renters  Society,  (1958)  2

AllER 579, Lord Harman enunciated;

“What, then, are the requirements of natural  justice  in  a  case  of  this kind? First, I think that the person accused should know the nature of the accusation  made;  secondly,  that  he should  be  given  an  opportunity  to state  his  case;  and  thirdly,  of course, that the tribunal should act in  good  faith.  I  do  not  think  that there really is anything more”.

     (emphasis supplied)

28. This  Court  has  also  taken  similar

view. In Union of India v. P.K. Roy, AIR 1968

SC 850 : (1968) 2 SCR 196, speaking for the

Court, Ramaswami, J. observed:

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“(T)he extent and application of the doctrine of natural justice cannot be imprisoned within the strait jacket of a  rigid  formula.  The  application  of the doctrine depends upon the nature of the jurisdiction conferred on the administrative  authority,  upon  the character of the rights of the persons affected, the scheme and policy of the statute  and  other  relevant circumstances  disclosed  in  the particular case”.

29. In the leading case of A.K. Kraipak v.

Union of India,  (1969) 2 SCC 262, Hegde, J.

stated;

“What  particular  rule  of  natural justice should apply to a given case must depend to a great extent on the facts and circumstances of that case, the framework of the law under which the  enquiry  is  held  and  the constitution of the Tribunal or body of persons appointed for that purpose. Whenever a complaint is made before a court that some principle of natural justice had been contravened the court has to decide whether the observance of that rule was necessary for a just decision on the facts of that case”.

30. Again, in R.S. Dass v. Union of India,

1986 Supp SCC 617, this Court said;

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“It is well established that rules of natural justice are not rigid rules; they  are  flexible  and  their application  depends  upon  the  setting and  the  background  of  statutory provision, nature of the right which may be affected and the consequences which  may  entail,  its  application depends  upon  the  facts  and circumstances of each case”.

31. At the same time, however, effect of

violation of rule of audi alteram partem has to

be considered. Even if hearing is not afforded

to the person who is sought to be affected or

penalized, can it not be argued that notice

would have served no purpose” or “hearing could

not have made difference” or “the person could

not have offered any defence whatsoever”.

32. In this connection, it is interesting

to note that under the English Law, it was held

before  few  years  that  non-compliance  with

principles of natural justice would make the

order null and void and no further inquiry was

necessary.

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33. In the celebrated decision of Ridge v.

Baldwin, 1964 AC 40 : (1963) 2 AllER 66, it was

contended that an opportunity of hearing to the

delinquent  would  have  served  no  purpose.

Negativing the contention, however, Lord Reid

stated;

“It may be convenient at this point to deal with an argument that, even if  as  a  general  rule  a  watch committee must hear a constable in his  own  defence  before  dismissing him,  this  case  was  so  clear  that nothing  that  the  appellant  could have  said  could  have  made  any difference.  It  is  at  least  very doubtful  whether  that  could  be accepted as an excuse”.

 (emphasis supplied)

34. Wade  and  Forsyth  in  their  classic

work,  Administrative Law,  (9th Edn.) pp. 506-

509  also  stated  that  if  such  argument  is

upheld, the Judges may be tempted to refuse

relief on the ground that a fair hearing could

have made no difference to the result. “But in

principle it is vital that the procedure and

the merits should be kept strictly apart, since

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otherwise  the  merits  may  be  prejudiced

unfairly”. (emphasis supplied)

35. This Court expressed the same opinion.

In  Board  of  High  School  v.  Kumari  Chitra,

(1970)  1  SCC  121,  the  Board  cancelled  the

examination of the petitioner who had actually

appeared at the examination on the ground that

there was shortage in attendance at lectures.

Admittedly, no notice was given to her before

taking the action. On behalf of the Board it

was  contended  that  the  facts  were  not  in

dispute  and  therefore,  ‘no  useful  purpose

would have been served’ by giving a show cause

notice to the petitioner. This Court, however,

set aside the decision of the Board, holding

that the Board was acting in a quasi-judicial

capacity  and,  therefore,  it  ought  to  have

observed the principles of natural justice.

36. In  S.L. Kapoor v. Jagmohan,  (1980) 4

SCC 379, rejecting the argument that observance

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of  natural  justice  would  have  made  no

difference, this Court said;

“The non-observance of natural justice is  itself  prejudice  to  any  man  and proof  of  prejudice  independently  of proof of denial of natural justice is unnecessary.  It  ’ll  comes  from  a person who has denied justice that the person who has been denied justice is not prejudiced”.   (emphasis supplied)

37. The  recent  trend,  however,  is  of

‘prejudice’.  Even  in  those  cases  where

procedural requirements have not been complied

with, the action has not been held ipso facto

illegal, unlawful or void unless it is shown

that non-observance had prejudicially affected

the applicant.

38. In  Malloch  v.  Aberdeen  Corporation,

(1971) 2 AllER 1278, Lord Reid said;

“(I)t was argued that to have afforded a  hearing  to  the  appellant  before dismissing  him  would  have  been  a useless formality because whatever he might  have  said  could  have  made  no difference.  If that could be clearly demonstrated  it  might  be  a  good answer”.   (emphasis supplied)

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39. Lord  Guest  agreed  with  the  above

statement, went further and stated;

“A  great  many  arguments  might  have been put forward  but if none of them had any chance of success then I can see no good reason why the respondents should  have  given  the  appellant  a hearing,  nor  can  I  see  that  he  was prejudiced in any way”.

40. In  Jankinath  v.  State  of  Orissa,

(1969) 3 SCC 392, it was contended that natural

justice was violated inasmuch as the petitioner

was  not  allowed  to  lead  evidence  and  the

material gathered behind his back was used in

determining  his  guilt.  Dealing  with  the

contention, the Court stated;

“We  have  to  look  to  what  actual prejudice has been caused to a person by  the  supposed  denial  to  him  of  a particular right”. (emphasis supplied)

41. In B. Karunakar, this Court considered

several cases and held that it was only if the

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Court/Tribunal finds that the furnishing of the

report “would have made a difference” to the

result in the case that it should set aside the

order of punishment. The law laid down in  B.

Karunakar  was  reiterated  and  followed  in

subsequent  cases  also  [vide State  Bank  of

Patiala v. S.K. Sharma, (1996) 3 SCC 363; M.C.

Mehta v. nion of India, (1999) 6 SCC 237].

42. In  Aligarh  Muslim  University  v.

Mansoor  Ali  Khan,  (2000)  7  SCC  529,  the

relevant rule provided automatic termination of

service of an employee on unauthorized absence

for certain period. M remained absent for more

than five years and, hence, the post was deemed

to have been vacated by him. M challenged the

order being violative of natural justice as no

opportunity  of  hearing  was  afforded  before

taking the action.

43. Though the Court held that the rules

of natural justice were violated, it refused to

set  aside  the  order  on  the  ground  that  no

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prejudice was caused to M. Referring to several

cases,  considering  theory  of  ‘useless’  or

‘empty’  formality  and  noting  “admitted  or

undisputed”  facts,  the  Court  held  that  the

only conclusion which could be drawn was that

had M been given a notice, it “would not have

made any difference” and, hence, no prejudice

had been caused to M.

44. In  Ajit Kumar Nag v. General Manager

(PJ),  Indian  Oil  Corporation  Ltd,  Haldia  &

Ors.,  (2005) 7 SCC 764, speaking for a three

Judge  Bench,  one  of  us  (C.K.  Thakker,  J.)

stated: “We are aware of the normal rule that a person must have a fair trial and a fair appeal and he cannot be asked to be satisfied with an unfair trial and a fair appeal. We are also conscious of  the  general  principle  that  pre- decisional  hearing  is  better  and should  always  be  preferred  to  post- decisional  hearing.  We  are  further aware  that  it  has  been  stated  that apart from Laws of Men, Laws of God also observe the rule of audi alteram partem.  It has been stated that the first  hearing  in  human  history  was given in the Garden of Eden. God did not  pass sentence upon Adam and Eve

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before giving an opportunity to show cause  as  to  why  they  had  eaten  the forbidden fruit. [See R. v. University of Cambridge, (1723) 1 Str 557] But we are also aware that the principles of natural  justice  are  not  rigid  or immutable  and  hence  they  cannot  be imprisoned  in  a  straitjacket.  They must  yield  to  and  change  with exigencies of situations. They must be confined  within  their  limits  and cannot be allowed to run wild. It has been stated: “ ‘To do a great right’ after all, it is permissible sometimes ‘to  do  a  little  wrong’.”  [Per Mukharji, C.J. in  Charan Lal Sahu v. Union  of  India,  (1990)  1  SCC  613 (Bhopal Gas Disaster), SCC p. 705,para 124.]  While  interpreting  legal provisions, a court of law cannot be unmindful  of  the  hard  realities  of life. In our opinion, the approach of the Court in dealing with such cases should  be  pragmatic  rather  than pedantic,  realistic  rather  than doctrinaire,  functional  rather  than formal  and  practical  rather  than precedential”. (emphasis supplied)

45. Recently,  in  P.D.  Agrawal  v.  State

Bank of India & Ors.,  (2006) 8 SCC 776, this

Court  restated  the  principles  of  natural

justice and indicated that they are flexible

and in the recent times, they had undergone a

‘sea change’. If there is no prejudice to the

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employee, an action cannot be set aside merely

on  the  ground  that  no  hearing  was  afforded

before taking a decision by the authority.

46. In  Ranjit  Singh  v.  Union  of  India,

(2006) 4 SCC 153, referring to the relevant

case-law, this Court said;

“In  view  of  the  aforementioned decisions of this Court, it is now well settled that the principles of natural justice were required to be complied  with  by  the  disciplinary authority. He was also required to apply his mind to the materials on record. The enquiry officer arrived at findings which were in favour of the  appellant.  Such  findings  were required  (sic sought)  to  be overturned  by  the  disciplinary authority. It is in that view of the matter,  the  power  sought  to  be exercised  by  the  disciplinary authority, although not as that of an Appellate Authority, but is akin thereto. The inquiry report was in favour  of  the  appellant  but  the disciplinary  authority  proposed  to differ  with  such  conclusions  and, thus, apart from complying with the principles of natural justice it was obligatory  on  his  part,  in  the absence of any show-cause filed by the  appellant,  to  analyse  the materials on record afresh. It was all the more necessary because even CBI, after a thorough investigation in the matter, did not find any case

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against  the  appellant  and  thus, filed  a  closure  report.  It  is, therefore,  not  a  case  where  the appellant  was  exonerated  by  a criminal court after a full-fledged trial by giving benefit of doubt. It was  also  not  a  case  where  the appellant  could  be  held  guilty  in the  disciplinary  proceedings applying  the  standard  of  proof  as preponderance of the probability as contrasted  with  the  standard  of proof in a criminal trial i.e. proof beyond all reasonable doubt. When a final form was filed in favour of the appellant, CBI even did not find a prima facie case against him. The disciplinary  authority  in  the aforementioned  peculiar  situation was obligated to apply its mind on the materials brought on record by the  parties  in  the  light  of  the findings arrived at by the inquiry officer. It should not have relied only on the reasons disclosed by him in his show-cause notice which, it will bear repetition to state, was only  tentative  in  nature.  As  the Appellate  Authority  in  arriving  at its  finding,  laid  emphasis  on  the fact  that  the  appellant  has  not filed  any  objection  to  the  show- cause notice; ordinarily, this Court would not have exercised its power of judicial review in such a matter, but the case in hand appears to be an exceptional one as the appellant was  exonerated  by  the  inquiry officer. He filed a show-cause but, albeit  after  some  time  the  said cause  was  available  with  the disciplinary  authority  before  he issued the order of dismissal. Even

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if  he  had  prepared  the  order  of dismissal, he could have considered the show-cause as he did not leave his office by then. The expression “communication”  in  respect  of  an order of dismissal or removal from service would mean that the same is served upon the delinquent officer”. (See  State of Punjab v.  Amar Singh Harika, AIR 1966 SC 1313)

47. From  the  aforesaid  decisions,  it  is

clear that though supply of report of Inquiry

Officer is part and parcel of natural justice

and  must  be  furnished  to  the  delinquent-

employee,  failure  to  do  so  would  not

automatically  result  in  quashing  or  setting

aside of the order or the order being declared

null  and  void.  For  that,  the  delinquent

employee has to show ‘prejudice’. Unless he is

able to show that non-supply of report of the

Inquiry Officer has resulted in prejudice or

miscarriage of justice, an order of punishment

cannot  be  held  to  be  vitiated.  And  whether

prejudice had been caused to the delinquent-

employee  depends  upon  the  facts  and

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circumstances  of  each  case  and  no  rule  of

universal application can be laid down.

48. In  the instant case, no finding has

been recorded by the High Court that prejudice

had  been  caused  to  the  delinquent-employee-

writ-petitioner. According to the High Court,

such prejudice is ‘writ large’. In our view,

the above observation and conclusion is not in

consonance  with  the  decisions  referred  to

above, including a decision of the Constitution

Bench in  B. Karunakar.  The view of the High

Court, hence, cannot be upheld. The impugned

order, therefore, deserves to be set aside and

is accordingly set aside.

49. Since  the  High  Court  has  not

considered the second question, namely, whether

failure to supply the report of the Inquiry

Officer had or had not resulted in prejudice to

the delinquent employee, ends of justice would

be met with if we remit the matter to the High

Court to decide the said question.

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50. For the foregoing reasons, the appeal

deserves  to  be  allowed  and  is  accordingly

allowed  with  the  above  observations.  On  the

facts and in the circumstances of the case,

however, there shall be no order as to costs.

…………………………………………………J. (C.K. THAKKER)

NEW DELHI, …………………………………………………J. JULY 08, 2008. (D.K. JAIN)

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