Reasoned orders and principle of fairness in administrative actions-a need of the hour

[AMIT BAJAJ ADVOCATE]

It is the general tendency of the adminstrative authorities more so of the tax authorities to pass non-speaking orders or to pass orders in violation of principle of fairness and rules of natural justice, without giving any opportunity of being heard to the effected person. The authorities in many case pass orders in gross violation of rules of natural justice.

 

The material relied upon against the effected person are not confronted to such effected person and thereby an opportunity to cross examine the same is denied and thereby right to defend oneself is also denied. On the other hand the evidences produced by the concerned person are ignored while passing the orders without rebutting the same.

 

The giving of reasons is one of the fundamentals of good administration. It is a safeguard against arbitrariness on the part of decision maker. An executive officer develops a habit of mind to look at things from the stand point of policy and expediency. This mental habit does not change from function to function. Giving of reasons imposes some restriction on an executive officer in a matter involving personal rights. If an adjudicator is obligated to give reasons for his conclusions, it will make it necessary for him to consider the matter, carefully. The condition to give reasons introduces clarity and transparency in administration and minimizes arbitrariness for compulsion of disclosure guarantees consideration.

 

The purpose of disclosure of reasons is that the people must have confidence in the judicial and quasi-judicial authorities. Unless reasons are disclosed, how can a person know whether the authority has applied its mind or not? Also, giving reasons minimizes the chances of arbitrariness. Hence, it is an essential requirement of the rule of law that some reasons, atlest in brief, must be disclosed in a judicial or quasi-judicial order, even if it is an order of affirmation.

 

The above view is supported by the decision of Supreme Court in Chairman, Disciplinary Authority, Rani Lakshmi Bai Kshetriya Gramin Bank v. Jagdish Sharan Varshney [2009 (3) TMI 972 - Supreme Court of India]

 

Hon’ble the Supreme Court in M/s Steel Authority of India Ltd vs Sales Tax Officer, Rourkela-I, Circle [2008 (7) TMI 551 - SUPREME COURT OF INDIA] , as follows:

“Reason is the Heartbeat of every conclusion. It introduces clarity in any order and without the same it becomes lifeless. Giving of reasons is one of the fundamentals of good administration.

 

Even in respect of administrative orders Lord Denning, M.R. in Breen v. Amalgamated Engg. Union [1971] 1 All ER 1148, observed: "The giving of reasons is one of the fundamentals of good administration." In Alexander Machinery (Dudley) Ltd. v. Crabtree [1974] ICR 120 (NIRC) it was observed: "Failure to give reasons amounts to denial of justice". "Reasons are live links between the mind of the decision-taker to the controversy in question and the decision or conclusion arrived at." Reasons substitute subjectivity by objectivity.The emphasis on recording reasons is that if the decision reveals the "inscrutable face of the sphinx", it can, by its silence, render it virtually impossible for the courts to perform their appellate function or exercise the power of judicial review in adjudging the validity of the decision. Right to reason is an indispensable part of a sound judicial system; reasons at least sufficient to indicate an application of mind to the matter before court. Another rationale is that the affected party can know why the decision has gone against him. One of the salutary requirements of natural justice is spelling out reasons for the order made; in other words, a speaking- out. The "inscrutable face of the sphinx" is ordinarily incongruous with a judicial or quasi-judicial performance.”

 

Similarly, a cardinal principle of natural justice is that an adjudicatory body is to decide the matter on the basis of materials placed before it in the cource of proceedings. The decision maker cannot take extraneous matters into consideration; it cannot base its decision on any material unless the person against whom it is sought to be utilized has been given an opportunity to rebut or explain the same.

 

If the adjudicator is going to rely on any material, evidence or document for basing his decision against the affected person then the same must be placed before him for his comments and rebuttal. All material must be brought to his notice and he be given an opportunity to respond to the same. The right of hearing may be of little value if the concerned person is kept in dark as to the evidence against him and he is not given an opportunity to deal with him.

 

It is regarded as a fundamental principle of natural justice that no materials should be relied on against a party without giving him an opportunity of explaining the same. The right to know the materials of which the authority is going to take a decision is a part of the right to defend oneself. If without disclosing any material to the concerned party, the adjudicator takes the same into consideration, and decides the matter against him, then the decision would be vitiated for it amounts to denial of a real and effective opportunity to the party to meet the case against him.

 

The Supreme Court has stated in this respect in Union of India v. Varma T.R., 1957 (9) TMI 41 - SUPREME COURT that no material should be relied on against a person without his being given an opportunity of explaining them.

 

In nut shell the principle of fairness and justice demands that every administrative order or even conclusion should be supported by reasons and the principle of audi alterm partem is fairly observed by giving proper opportunity to the effected person to produce all evidences in his support and also an opportunity to rebut evidences to be used against him by confronting the same to him, which are collected at his back. The authorities must also not ignore evidences produced by the effected person without rebutting the same.

 

All administrative orders passed in gross violation of rules of natural justice, which gets quashed in the appellate proceedings, causes unneccessary litigation and harrasment to innocent persons and therefore this matter must be seriously viewed by every State Government as also the Central government, which unfortunately is not happening on the part of any one of them. Need of the hour is that a strict law fixing the responsibility of administrative officers must be enacted so that principle of fairness remains alive in the administrative actions and therefore ensuring that law and justice is administered under a good administration.