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TMI Blog2024 (7) TMI 1407X X X X Extracts X X X X X X X X Extracts X X X X ..... for a period of three years. This is the dire civil and economic consequence that would ensue. Therefore, it cannot be said that sub-(2) of Section 14 of the Act is restricted only to hearing, hearing would mean only issuance of a show cause notice. Therefore, the contention of the learned Central Government Counsel is to be repelled and is accordingly repelled. I am in respectful agreement with what the learned single Judge of the High Court of Madhya Pradesh has held, interpreting sub-section (2) of Section 14 of the Act. Principles of natural justice, is trite cannot be stretched to unlimited extent. But, it is equally trite that when consequences thereof are grave, it should be complied with in its entirety even stretching in a little further. Therefore, the words depicted in the Act reasonable opportunity of being heard cannot be restricted to issuance of a show cause notice but a personal hearing in the peculiar facts of the case owing to the peculiarity of sub-section (3) of Section 14 of the Act must have been afforded to the petitioner. Non-affording of personal hearing to the petitioner has rendered the order unsustainable and the unsustainability of it, would lead to its ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d to meet the expenses of the Trust. It is the averment in the petition that separate accounts have been maintained for the receipt utilization etc. It would suffice if the story is forwarded to 05-03-2021 when the respondent/Union of India issues an order of suspension of registration of the petitioner for a period of six months. A communication is made to the petitioner in the form of a questionnaire. The claim of the petitioner is that, the communication never reached the petitioner. The petitioner on 11-04-2021, against the order of suspension, sends a reply setting out all the details including maintenance of accounts or otherwise. It is then on 03-12-2021, a show cause notice comes to be issued to the petitioner to show cause as to why registration of the petitioner should not be cancelled in terms of sub-section (2) of Section 14 of the Act. The petitioner contends that a detailed reply was sent by the petitioner to the show cause notice refuting each one of the allegations. On 04-09-2023 an order comes to be passed cancelling the registration. The contention of the petitioner is that objections/reply of the petitioner running to over 25 pages and considering nothing, a cryp ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s with Central Government. Section 12 of the Act deals with grant of certificate of registration on an application made under Section 11 of the Act. Section 13 of the Act deals with suspension of certificate. Section 14 of the Act deals with cancellation of certificate. It is germane to notice Sections 13 and 14 of the Act and they read as follows: 13. Suspension of certificate. ( 1) Where the Central Government, for reasons to be recorded in writing, is satisfied that pending consideration of the question of cancelling the certificate on any of the grounds mentioned in sub-section (1) of Section 14, it is necessary so to do, it may, by order in writing, suspend the certificate 11[for a period of one hundred and eighty days, or such further period, not exceeding one hundred and eighty days, as may be specified] in the order. (2) Every person whose certificate has been suspended shall (a) not receive any foreign contribution during the period of suspension of certificate: Provided that the Central Government, on an application made by such person, if it considers appropriate, allow receipt of any foreign contribution by such person on such terms and conditions as it may specify; (b) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mic consequences. In the teeth of the tenor of sub-section (3) and the purport of subsection (2), the lis requires consideration. 10. The contention is that, a show cause notice is issued on 03-12-2021 seeking to show cause as to why registration should not be cancelled invoking Section 14 of the Act. The petitioner is said to have given a 25 page reply. The violations alleged in the show cause notice, as averred in the petition, read as follows: (i) Non-intimation and utilization accounts; (ii) Transfer of foreign contribution in FCRA; (iii) Receiving foreign contribution in its utilization accounts; (iv) Receiving domestic funds into its utilization accounts. (v) Utilization of foreign contribution for personal gain by transfer of vehicle; and (vi) Misuse of foreign contribution to finance WILD KAAPI LLP . The reply submitted by the petitioner thereto, again as averred in the petition, can be broadly classified as follows: (i) The petitioner has intimated the utilization accounts to the Ministry from time to time and there has been no violation and no specific instance of non-intimation has been alleged. (ii) Petitioner was running 2 years Masters Degree Program in Wild Life Prot ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ) DALMIA CEMENT (BHARAT) LIMITED v. GOVERNMENT OF KARNATAKA 2019 SCC OnLine Kar 802 and (ii) STATE BANK OF MYSORE v. R.SHAMANNA 1984 SCC OnLine Kar 112. 12. The Division Bench in the case of Dalmia Cement was considering an identical provision. The Rule that fell for interpretation therein was sub-rule (1) of Rule 12 of the Mineral Concession Rules, 1960. The Division Bench holds as follows: 5. We have considered the submissions. Rule 12 of the said Rules reads thus: 12. Refusal of application for a prospecting licence (1) The State Government may, after giving an opportunity of being heard and for reasons to be recorded in writing and communicated to the applicant refuse to grant or renew a prospecting licence over the whole or part of the area applied for. (1A) An application for the grant or renewal of a prospecting licence made under rule 9 shall not be refused by the State Government only on the ground that Form B or Form E, as the case may be, is not complete in all material particulars, or is not accompanieg, by the documents referred to in clauses (d), (e), (f) and (g) of sub-rule (2) of the said rule. (1B) Where it appears that the application is not complete in all materi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e State of opportunity being heard would not mean that opportunity of being personal hearing. The personal hearing was directed to be granted by setting aside the action impugned therein. 13. The other judgment which emanates from service jurisprudence, the Division Bench considering the State Bank of Mysore Regulations would hold as follows: 18. Apart from that, there is a greater illegality in the procedure followed by the disciplinary authority against the respondent. Sub-rule (a) to Rule 19.12. of the Rules reads: He shall also be given a hearing as regards the nature of the proposed punishment in case any charge is established against him. (Emphasis supplied) This Sub-rule envisages something more than mere opportunity to be afforded to the respondent. It requires a hearing to be given. The difference between mere opportunity and hearing is explict. There may be fusion between the two, but there should not be a confusion between the two concepts. Opportunity may be extended to hearing, but hearing cannot be condensed or limited to mere opportunity to file objections or representations. Hearing means, ordinarily an opportunity of being heard, that means personal hearing. It is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed herein as contended by the learned counsel for the petitioner has not been disputed by the respondent. However, four months after the renewal of the certificate, the impugned order was passed, whereby the renewed certificate has been declared non-est ab initio. The reason given for the said reversal of renewal is seen in paragraph-6 of the impugned order in just one line, which is and whereas, there is need to revise the said order for renewal of registration in public interest what that pubic interest is or what the activity of the petitioner could be seen or understood to be prejudicial to the interest of governance by the respondent, Union of India, is not mentioned in the said order. Ex-facie the orders smacks of arbitrariness. Once the right has been created in the petitioner to continue with his activities, to receive foreign aids and the same ought not be set-aside by the Union of India. The order setting aside the certificate of renewal ought to have explained the reasons why it was necessary to set aside elaborately and the petitioner should have been given an adequate opportunity, not just by way of natural justice, but also in view of section 14 of the FCRA which rela ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ty to revise an order granting certificate of operation to any NGOs but before it can do that, it must comply with the mandatory provisions of section 14 of sub-section (2) of the FCRA, 2010. 7. Under the circumstances, this petition succeeds and the impugned order dated 24.12.2016 is quashed on grounds of arbitrariness and also on the grounds of non-compliance with sub-section (2) of section 14 of FCRA. Consequently, the petitioner is reverted to the position that existed before the impugned order was passed. However, the Union of India shall be at liberty to exercise jurisdiction for cancellation of the certificate granted to the petitioner but after following the due process as stipulated under sub-section (2) of section 14 of the FCRA. (Emphasis supplied) 15. The learned Central Government Counsel has placed reliance upon several judgments. I deem it appropriate to consider the same. The Apex Court in the case of UNION OF INDIA v. JESUS SALES CORPORATION (1996) 4 SCC 69 at paragraphs 4 and 5 on which the learned counsel has placed reliance read as follows: 4. The learned counsel appearing on behalf of the Union of India took a stand that when aforesaid proviso requires the appe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cannot be held that before dismissing such appeals or applications in all events the quasi-judicial authorities must hear the appellants or the applicants, as the case may be. When principles of natural justice require an opportunity to be heard before an adverse order is passed on any appeal or application, it does not in all circumstances mean a personal hearing. The requirement is complied with by affording an opportunity to the person concerned to present his case before such quasi-judicial authority who is expected to apply his judicial mind to the issues involved. Of course, if in his own discretion if he requires the appellant or the applicant to be heard because of special facts and circumstances of the case, then certainly it is always open to such authority to decide the appeal or the application only after affording a personal hearing. But any order passed after taking into consideration the points raised in the appeal or the application shall not be held to be invalid merely on the ground that no personal hearing had been afforded. This is all the more important in the context of taxation and revenue matters. When an authority has determined a tax liability or has impos ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l circumstances that it should be personal hearing. Therefore, the Apex Court holds that in all circumstances it cannot lead to personal hearing. It is not a blanket ban by the Apex Court. The other judgment relied on by the learned counsel for the respondent is PATEL ENGINEERING LIMITED v. UNION OF INDIA (2012) 11 SCC 257 wherein it is held as follows: 38. Coming to the submission that R-2 ought to have given an oral hearing before the impugned order was taken, we agree with the conclusion of the High Court that there is no inviolable rule that a personal hearing of the affected party must precede every decision of the State. This Court in Union of India v. Jesus Sales Corpn. [(1996) 4 SCC 69] held so even in the context of a quasi-judicial decision. We cannot, therefore, take a different opinion in the context of a commercial decision of the State. The petitioner was given a reasonable opportunity to explain its case before the impugned decision was taken. (Emphasis supplied) The Apex Court observes while negativing the contention that the appellant therein had to be given oral hearing before the order impugned therein was passed while agreeing that the view of the High Court tha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ersonal hearing in any circumstance while interpreting a statute. 16. As observed hereinabove, sub-section (2) of Section 14 of the Act permits cancellation of registration. The consequence thereof is found in sub-section (3) which permits no registration under the Act for an entity which suffered cancellation for a period of three years. This is the dire civil and economic consequence that would ensue. Therefore, it cannot be said that sub-(2) of Section 14 of the Act is restricted only to hearing, hearing would mean only issuance of a show cause notice. Therefore, the contention of the learned Central Government Counsel is to be repelled and is accordingly repelled. I am in respectful agreement with what the learned single Judge of the High Court of Madhya Pradesh has held, interpreting sub-section (2) of Section 14 of the Act. Principles of natural justice, is trite cannot be stretched to unlimited extent. But, it is equally trite that when consequences thereof are grave, it should be complied with in its entirety even stretching in a little further. Therefore, the words depicted in the Act reasonable opportunity of being heard cannot be restricted to issuance of a show cause no ..... X X X X Extracts X X X X X X X X Extracts X X X X
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