IN THE HIGH COURT OF HIMACHAL PRADESH, SHIMLA. CWP No.: 4 of 2007 Reserved on: 9.1.2008 Decided on: 25.02.2008 Prakash Chand and others … Petitioner. Versus State of H.P. and others … Respondents. Coram: The Hon’ble Mr. Justice Rajiv Sharma, J. Whether approved for reporting?1 Yes. For the Petitioner: Mr. Y. Paul, Advocate. For the Respondents: Mr. M.A. Khan, Dy. Advocate General respondents No.1 and 2. Mr. B.K. Malhotra, Advocate for respondents No.3 and 4. Rajiv Sharma, Judge: The brief facts necessary for the adjudication of this petition are that respondents No.3 and 4 raised objections against the consolidation proceedings before the Consolidation Officer, Bilaspur, District Bilaspur vide file No. 97 of 1993 under section 30 (2) of the H.P. Holdings (Consolidation and Prevention of Fragmentation) Act, 1971. The objections raised by respondents No.3 and 4 were dismissed by the Consolidation Officer. Respondents No.3 and 4 filed an appeal before the Settlement Officer, Bilaspur against the order passed by the Consolidation Officer. The Settlement Officer remanded the case to the Consolidation Officer, Bilaspur. The Consolidation Officer modified the previous order while issuing certain directions. 1 Whether reporters of local papers may be allowed to see the judgment? Yes. - 2 - Against this order passed by the Consolidation Officer, both the parties i.e. the petitioners as well as respondents No. 3 and 4 filed appeals before the Settlement Officer. Settlement Officer remanded the case No.8 of 1996 and 5 of 1996 on 27.1.1997 to the Consolidation Officer, Bilaspur. The Consolidation Officer passed the order in favour of respondents No.3 and 4 on 13.7.1998. The petitioners preferred an appeal against the order dated 13.7.1998 before the Settlement Officer under section 30 (3) H.P. Holdings (Consolidation and Prevention of Fragmentation) Act, 1971. The Settlement Office accepted the appeal of the petitioners on 22.12.2000 and allotted Khasra No.391/1, 392, 394 and 395 and khasra Nos. 949 and 749 to the petitioners. The respondents No.3 and 4 preferred an appeal against the order dated 22.12.2000 before the Additional Director Consolidation of Holdings. The Additional Director Consolidation accepted the appeal of respondents No.3 and 4 on 7.9.2001. Feeling aggrieved by the order dated 7.9.2001; the petitioner preferred the petition under section 54 of the H.P. Holdings (Consolidation and Prevention of Fragmentation) Act, 1971 before the Director Consolidation of Holdings. The Director Consolidation of Holding dismissed the petition on 1.10.2005. The petitioners have assailed orders dated 7.9.2001 and 1.10.2005 passed by the Additional Director, Consolidation of Holdings and Director, Consolidation Holdings, H.P. Mr. Y. Paul, Advocate appearing on behalf of the petitioners had strenuously argued that both the orders i.e. 7.9.2001 and 1.10.2005 are not speaking orders and are liable to be set aside. Mr. M.A. Khan, Deputy Advocate General appearing on behalf of respondent-State and Mr. B.K. Malhotra, Advocate appearing on - 3 - behalf of respondents No.3 and 4 have supported the impugned orders. I have heard the learned counsel for the parties and perused the record carefully. It is evident from the pleadings of the parties that the Consolidation Officer had passed the order on 13.7.1998 against which the petitioners preferred an appeal before the Settlement Officer. The Settlement Officer after taking into consideration all the pleas raised by the petitioners have allowed the appeal on 22.12.2000. The order passed by the Settlement Officer has been set aside by the Additional Director, Consolidation of Holdings on 7.9.2001. The order dated 7.9.2001 is neither reasoned nor a speaking order. What has been mentioned in the order dated 7.9.2001 by the Additional Director is that he has perused the order of the District Judge dated 11.5.1999, S.O. (CH) and C.O. and on that basis he had come to a conclusion that the arguments advanced by the learned counsel for respondents No.3 and 4 were based on fair facts. The Additional Director, Consolidation of Holdings has not given any independent findings how he has disagreed with the findings recorded by the Settlement Officer in his order dated 22.12.2000. The Additional Director was required to give reasons while setting aside the order of the Settlement Officer dated 22.12.2000. Similarly, the order passed by the Director, Consolidation of Holdings dated 1.10.2005 is neither speaking nor reasoned one. The Director, Consolidation of Holdings was required to give reasons while rejecting the appeal preferred by the petitioners under section 54 of the H.P. Holdings (Consolidation and Prevention of Fragmentation) Act, 1971. The Director, Consolidation of Holdings has only quoted the sequence of events in which the parties had been litigating before the - 4 - competent authorities. The Director of Consolidation of Holdings only stated in his order that the Additional Director (CH) has passed the order as per the provisions of the scheme and is based on the facts. The Director, Consolidation of Holdings was required to take into consideration the grounds mentioned in the petition preferred by the petitioners and was required to give the independent findings even while upholding the orders of Additional Director, Consolidation of Holdings, H.P. Their Lordships of the Hon’ble Supreme Court have held in The Siemens Engineering and Manufacturing Co. of India Ltd., v. The Union of India and another, AIR 1976, Supreme Court 1785 that quasi-judicial order must be supported by reasons. Their Lordships have held as under:- “Before we part with this appeal, we must express our regret at the manner in which the Assistant Collector, the Collector and the Government of India disposed of the proceedings before them. It is incontrovertible that the proceedings before the Assistant Collector arising from the notices demanding differential duty were quasi-judicial proceedings and so also were the proceedings in revision before the Collector and the Government of India. Indeed, this was not disputed by the learned counsel appearing on behalf of the respondents. It is now settled law that where an authority makes an order in exercise of a quasi-judicial function, it must record its reasons in support of the order it makes. Every quasi-judicial order must be supported by reasons. That has been laid down by a long line of decisions of this Court ending with N. M. Desai v.Tessteels Ltd., C.A. No.245 of 1970 decided on 17- 12-1975 (SC). But, unfortunately, the Assistant - 5 - Collector did not choose to give any reasons in support of the order made by him confirming the demand for differential duty. This was in plain disregard of the requirement of law. The Collector in revision did give some sort of reason but it was hardly satisfactory. He did not deal in his order with the arguments advanced by the appellants in their representation dated 8th December, 1961 which were repeated in the subsequent representation dated 4th June, 1965. It is not suggested that the Collector should have made an elaborate order discussing the arguments of the appellants in the manner of a court of law. But the order of the Collector could have been a little more explicit and articulate so as to lend assurance that the case of the appellants had been properly considered by him. If courts of law are to be replaced by administrative authorities and tribunals, as indeed, in some kinds of cases, with the proliferation of Administrative law, they may have to be so replaced, it is essential that administrative authorities and tribunals should accord fair and proper hearing to the persons sought to be affected by their orders and give sufficiently clear and explicit reasons in support of the orders made by them. Then alone administrative authorities and tribunals exercising quasi-judicial function will be able to justify their existence and carry credibility with the people by inspiring confidence in the adjudicatory process. The rule requiring reasons to be given in support of an order is, like the principle of audi alteram partem, a basic principle of natural justice which must inform every quasi-judicial process and this rule must be observed in its proper spirit and mere pretence of compliance with it would not satisfy the requirement of law. The Government of India also - 6 - failed to give any reasons in support of its order rejecting the revision application. But we may presume that in rejecting the revision application, it adopted the same reason which prevailed with the Collector. The reason given by the Collector was, as already pointed out, hardly satisfactory and it would, therefore, have been better if the Government of India had given proper and adequate reasons dealing with the arguments advanced on behalf of the appellants while rejecting the revision application. We hope and trust that in future the Customs Authorities will be more careful in adjudicating upon the proceedings which come before them and pass properly reasoned orders, so that those who are affected by such orders are assured that their case has received proper consideration at the hands of the Customs authorities and the validity of the adjudication made by the Customs authorities can also be satisfactorily tested in a superior tribunal or court. In fact, it would be desirable that in cases arising under Customs and Excise laws an independent quasi-judicial tribunal, like the Income- tax Appellate Tribunal or the Foreign Exchange Regulation Appellate Board, is set up which would finally dispose of appeals and revision applications under these laws instead of leaving the determination of such appeals and revision applications to the Government of India. An independent quasi-judicial tribunal would definitely inspire greater confidence in the public mind.” The Hon’ble Supreme Court has held in State of West Bengal v. Atul Krishna Shaw and another, AIR 1990 Supreme Court 2205 that unless adequate reasons are given, - 7 - merely because it is an appellate authority, it cannot brush aside the reasoning or findings recorded by the primary authority. Their Lordships have held as under:- “The appellate authority being final authority on facts is enjoined and incumbent upon it to appreciate the evidence; consider the reasoning of the primary authority and assign its own reasons as to why he disagrees with the reasons and findings of the primary authority. Unless adequate reasons are given, merely because it is an appellate authority, it cannot brush aside the reasoning or findings recorded by the primary authority.” Their Lordships of the Hon’ble Supreme Court in latest pronouncement in Divisional Forest Officer, Kothagudem and others Versus Madhusudhan Rao, 2008 (2) Scale 322 have held that though it is true that no detailed reasons are required to be given by the appellate authority, but some brief reasons should be indicated even in an order confirming the views of the lower forum. Their Lordships have held as under. “It is no doubt also true that an appellate or revisional authority is not required to give detailed reasons for agreeing and confirming an order passed by the lower forum but, in our view, in the interests of justice, the delinquent officer is entitled to know at least the mind of the appellate or revisional authority in dismissing his appeal and/or revision. It is true that no detailed reasons are required to be given by the appellate authority, but some brief reasons should be indicated even in an order confirming the views of the lower forum.” Consequently the writ petition is allowed. Annexure P1 dated 1.10.2005 is quashed and set aside. The Director, Consolidation of - 8 - Holdings, H.P. is directed to decide the petition bearing No. 181/2002 afresh and pass a speaking and reasoned order. To avoid delay, the parties are directed to appear before the Director, Consolidation of Holdings, H.P. on 7th March, 2008. There shall be no order as to costs. (Rajiv Sharma) Judge. February 25, 2008 *Awasthi*