Reasoned decisions, exceptions to natural justice, effect of breach and Article 136
Administrative Law · Unit III · Topic 11 of 18 · 7 min read
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Cases checked to exist. Read the judgment before quoting a holding.
Every case cited here has been checked to exist — the citation resolves and names the right parties. The propositions attributed to each case have not been verified line by line against the judgment. Case names link through to the full judgment: read it before quoting a holding in an examination answer, and never carry a proposition from notes into court on trust.
1. Reasoned decisions
A reasoned decision, or speaking order, states the reasons on which it is based. It is sometimes described as the third principle of natural justice.
Why reasons matter. They show that the authority applied its mind; they exclude arbitrariness and the influence of irrelevant considerations; they let the person know why he lost and decide whether to appeal; and they make judicial review possible, since a court cannot test a decision whose basis it does not know.
In Siemens Engineering and Manufacturing Co. v. Union of India, 1976 INSC 133, (1976) 2 SCC 981, the Assistant Collector and the appellate authorities under customs law disposed of the appellant's case without dealing with its contentions. Bhagwati J. said 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; the rule requiring reasons is like the principle of audi alteram partem, a basic principle of natural justice that must inform every quasi-judicial process. Reasons must be clear and explicit, not mere rubber-stamp reasons.
The Constitution Bench in S.N. Mukherjee v. Union of India, 1990 INSC 257, (1990) 4 SCC 594, settled the position. An administrative authority exercising quasi-judicial functions must record reasons, unless the requirement is expressly or by necessary implication excluded. The reasons need not be elaborate, but they must disclose that the authority applied its mind. On the facts, the Army Act was held to exclude reasons for confirmation of the findings and sentence of a court martial, so the challenge failed on that point.
2. Exceptions to natural justice
Natural justice is implied by courts, so it can be excluded or modified where the context requires. The recognised exceptions:
- Statutory exclusion, express or by necessary implication, subject to Article 14. A statute that excludes a hearing in a case that plainly requires one may itself be unconstitutional.
- Constitutional exclusion. The second proviso to Article 311(2) dispenses with an inquiry before dismissal in three situations; its scope was settled in Union of India v. Tulsiram Patel (1985), covered in the Constitutional Law II note on Services under the Union and States: protection of civil servants.
- Legislative action: rules and notifications of general application (Union of India v. Cynamide India Ltd., 1987).
- Urgency and emergency, where immediate action is needed to protect health, safety or public money. A post-decisional hearing may be required (Swadeshi Cotton Mills).
- Impracticability, where the number of persons affected makes individual hearing impossible (Bihar School Examination Board v. Subhas Chandra Sinha, 1970).
- Confidentiality and public interest, such as national security, where disclosure would itself cause harm.
- Academic evaluation: marking of answer scripts and assessment of academic performance.
- Interim and preventive action, such as suspension pending inquiry, which decides nothing finally.
- Necessity, for the rule against bias (see the Rule against bias note).
- Useless formality. In S.L. Kapoor v. Jagmohan, 1980 INSC 184, (1980) 4 SCC 379, the Court held that the New Delhi Municipal Committee was superseded in breach of natural justice, and that non-observance of natural justice is itself prejudice. But it added that where on the admitted or indisputable facts only one conclusion is possible, and under the law only one penalty is permissible, the court may not issue its writ to compel a hearing that would be a useless formality.
3. Effect of non-compliance: void or voidable?
The traditional view in India is that an order passed in breach of natural justice is void: it is a nullity, not merely voidable. In Nawabkhan Abbaskhan v. State of Gujarat, 1974 INSC 36, (1974) 2 SCC 121, an externment order made without hearing the person was held void from the start, so that he could not be convicted for disobeying it before it was set aside. An order that is void does not bind, though in practice it must still be challenged and declared void by a court.
On whether a defect at the original stage is cured by a fair appeal, the Court held in State of U.P. v. Mohammad Nooh, 1957 INSC 81, AIR 1958 SC 86, that a departmental inquiry so vitiated that it amounted to no inquiry at all was not saved by the existence or exercise of a right of appeal. The general rule is that a fair appeal does not cure an unfair hearing at first instance, though it may where the appellate body rehears the whole matter.
4. The prejudice test
The modern law asks whether the breach caused prejudice. In Managing Director, ECIL v. B. Karunakar, 1993 INSC 316, (1993) 4 SCC 727, a Constitution Bench held that an employee is entitled to a copy of the inquiry officer's report before the disciplinary authority decides on his guilt, but that the punishment will not be set aside automatically for failure to supply it. The court must see whether the report would have made a difference; if not, setting the order aside would be to stretch natural justice to the point of a mechanical rule. In State of U.P. v. Sudhir Kumar Singh, 2020 INSC 603, the Court reviewed the case law and held that, outside cases where no hearing at all was given, the person complaining must ordinarily show that the breach caused real prejudice.
5. Challenging a quasi-judicial decision before the Supreme Court
Article 136 allows the Supreme Court, in its discretion, to grant special leave to appeal from any judgment, decree, determination, sentence or order passed by any court or tribunal in India. Clause (2) excludes courts and tribunals under laws relating to the Armed Forces. An authority is a “tribunal” if it is invested with the judicial power of the State: Bharat Bank Ltd. v. Employees (1950), covered in the note on Quasi-judicial functions. The Court has also held that an election tribunal is subject to Article 136: Durga Shankar Mehta v. Raghuraj Singh, 1954 INSC 67, AIR 1954 SC 520. But an arbitrator chosen by the parties under section 10A of the Industrial Disputes Act, 1947 (since replaced by the Industrial Relations Code, 2020) is not: Engineering Mazdoor Sabha v. Hind Cycles Ltd., 1962 INSC 292, AIR 1963 SC 874.
The Court does not sit as a regular court of appeal on facts. It interferes with tribunal decisions where:
- the tribunal acted without or in excess of jurisdiction;
- it violated natural justice;
- it committed an error of law apparent on the record;
- its findings are perverse, based on no evidence, or reached by ignoring relevant evidence or relying on irrelevant material;
- there is grave and substantial injustice.
Dhakeswari Cotton Mills Ltd. v. Commissioner of Income Tax, 1954 INSC 103, AIR 1955 SC 65, is the standard example. The Supreme Court interfered with a decision of the Income Tax Appellate Tribunal reached in breach of natural justice, the assessee not having had a fair opportunity to meet the material used against it, and held that its power under Article 136 is not limited by provisions of the taxing statute that make the Tribunal's findings final.
How this is examined
Six-mark notes on “reasoned decision” (June 2025) and on exceptions to natural justice are regular. The effect of non-compliance and the Article 136 grounds appear as notes or as the closing part of a natural justice essay. For the reasoned decision note: purpose, Siemens, S.N. Mukherjee, and the rule that reasons need not be elaborate.
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