Supreme Court of India
POONAMversusSTATE OF U.P. & ORS.
- Citation
- 2015 INSC 813
- Decided
- 29 October 2015
- Disposal
- Dismissed
- Bench
- DIPAK MISRA
Holding
The appellant is not a necessary or proper party and therefore cannot assail the appellate order; the appeal is dismissed.
Summary
The appellant, a visually‑handicapped allottee of a fair‑price shop, challenged an appellate order that restored the original allottee's licence and cancelled her own allotment. The High Court dismissed her writ petition on the ground that she was not a necessary party. The Supreme Court examined whether a subsequent allottee can be a necessary or proper party to assail an order affecting the original allottee’s rights. Relying on the doctrine of natural justice and the concept of necessary parties, the Court held that the appellant was neither a necessary nor a proper party; only the State or the original allottee could have challenged the order. Consequently, the appeal was dismissed.
Issues considered
- Whether the subsequent allottee (appellant) is a necessary or proper party to challenge the appellate order cancelling the original allottee's licence.
- Whether the principles of natural justice and the proviso to Order 1 Rule 9 of the CPC apply in writ jurisdiction for determining necessary parties.
Legislation cited
- Code of Civil Procedure, 1908s. Order 1 Rule 9
- Constitution of Indias. Art.141, s. Art.226, s. Art.227, s. Art.236
- General Clauses Act, 1897
Subjects
necessary partyproper partynatural justicewrit jurisdictionArticle 226fair price shopallotmenthorizontal reservationvisually handicapped quota
Judgment
[2015] 14 S.C.R. 565
POONAM A
v.
STATE OF U.P. & ORS.
(CivilAppeal No. 6774of2015)
B
· OCTOBER 29, 2015
[DIPAK MISRAAND R. BANUMATHI, JJ.]
Constitution of India, 1950 -Art.226 - Right to assail
.·appellate order in writ jurisdiction - Concept of necessary
. and proper party - Allotment and grant of licence for a fair C
price shop- Respondent no. 5 was running a fair price shop,
which was .allotted to him - Various complaints against him
- Enquiry ordered - Enquiry report reflected improper
distribution of essential commodities in violation of
instructions -Allotment of respondent no.5 cancelled - He D
preferred appeal - Appellant got herself impleaded in the
appeal on the ground that she had been subsequently allotted
the shop after cancellation of the allotment of respondent
no.5 -Appellate authority restored the allotment made to
respondent no. 5 and cancelled the allotment of appellant, E
the subsequent allottee -Appellant preferred writ petition -
High Court dismissed the same on. ground· that appellant
had no right to continue the litigation being a subsequent
allottee -Approach of the High Court challenged -Plea that
appellant was appointed as a dealer under Visually F
Handicapped quota; and her rights being independent in
· nature, she had a right to assail the appellate order- Whether
appellant was a necessary party to the /is and.the writ court
was obliged to adjudicate the controversy on merits - Held:
In the instant case, the shop· in question had become vacant G
- The appellant was allotted the shop, may be in the
handicapped quota but such allotment is the resultant faCtor
of the said shop falling vacant- The original allottee, that is
respondent no.5, assailed his cancellation and ultimately
H
565
566 SUPREME COURT REPORTS [2015] 14S.C.R.
A succeeded in appeal - Appellant was neither a necessary
nor a proper party- The appellate authority permitted her to
participate but.that neither changes the situation nor does it
confer any legal status on her - She would have continued
to hold the shop had the original allottee lost the appeal -
B She cannot assail the said order in a writ petition because
she is not a necessary party-It is the State or its functionaries,
who could have challenged the same in appeal-They have
maintained sphinx like silence in that regard - Be that as it
may, that would not confer any locus on the subsequent
c allottee to challenge the order passed in favour of the former
allottee - She is a third party to the /is in this context -
Appellant, the writ petitioner before the High Court, was trying
to establish her right in an independent manner, that is, she
has an independent legal right - It is extremely difficult .to
o hold that she has an independent legal right- It was the first
allottee who could have continued in law, if his licence would
not have been cancelled - He was entitled in law to prosecute
his cause of action and restore his legal right - Restoration
of the legal right is pivotal and the prime mover- The eclipse
E being over, he has to come back to the same position - His
right gets revived and that revival of the right cannot be dented
by the third party-Appeal dismissed..
Doctrines/ Principles-Doctrine ofnatural justice- Held:
The basic principle behind the doctrine of natural justice, is
F that, no order should be passed behind the back of a person
who is to be adversely affected by the order- However, natural
justice is not an unruly horse - Its applicability has to be
adjudged regard being had to the effect and impact of the
order and the person who claims to be affected; and that is
G where the concept of necessary party become significant -
In absence of a necessary party, no adjudication can take
place and, in fact, the non-joinder would be fatal to the case
- Code of Civil Procedure - Necessary party.
H
POONAM v. STATE OF U.P. 567.
Judgments I Orders - Ratio decidendi - How to A
ascertain - Held: A ratio of a decision has to be understood
in its own context, regard being had to the factual exposition
- If there has been advertence to precedents, the same has
to be seen to understand and appreciate the true ratio.
J.S. Yadav vs State of U.P. &Anr. (2011) 6 SCC B
570 : 2011 (5) SCR 460 - explained.
U.P.' Awas Evain Vikas Parishad v. Gyan Devi
(Dead) by LRs. & Ors.. (1995) 2 sec 326; Delhi
Development Authority v. Bhola Nath Sharma c
(Dead) by LRs. and Ors. (2011) 2 sec 54 -
distinguished~
Sri Pal Yadav v. State cit U.P. and others 2008 (1)
ADJ 718; Udit Narain Singh Malpaharia v ·
Additional Member Board of Revenue, Bihar and o·
another AIR 1963 SC 786 : 1963 Suppl. SCR ·
676; Vijay Kumar Kaul and others v. Union of
India and others (2012) 7 SCC 610 : 2012 (6)
SCR 128; Asstt. G.M State Bank of India v.
Radhey ShyamPandey (2015) 3 SCALE 39; Hari E'
Vishnu Karnath v. Ahmad lshaque and Ors. AIR
1955 SC 233 : 1955 SCR 1104; The General
Manager, South Central Railway, Secunderabad ·
and another v A. V.R. Siddhantti and Others (197 4)
4 SCC 335 : 1974 (3) SCR 207; B. Gopalaiah F
and Ors v. Government of Andhra Pradesh AIR
1969 AP 204; J.S. Sachdev and Ors. v. Reserve
Bank of India, New DelhilLR (1973) 2 Delhi 392;
State of Himacha/ Pradesh and another v. Kai/ash
Chand Mahajan and Others 1992 Supp (2) SCC G
251; State of Kera/av. Miss Rafia Rahim AIR 1978
Ker 176; Padamraj v. State ofBihar AIR 1979
Pat 266; A. Janardhana v. Union oflndia (1983)
3 SCC 601 : 1983 (2) SCR 936; Sadananda Halo
H
568 SUPREME COURT REPORTS [2015] 148.C.R.
A and Others v. Momtaz Ali Sheikh and Others
(2008) 4 sec 619: 2008 (3) SCR 497; All India
· SC & ST Employees' Assn. v. A. Arthur Jeerr
(2001) 6 SCC 380: 2001 (2) SCR 1183; Canara
. Bank v. Debasis Das (2003) 4 SCC 557 : 2003
B . (2) SCR 968; State of Punjab v. Bhajan Kaur
{2008) 12 SCC 112; Sangam Spinners v. Reg/.
Provident Fund Commr. (2008) 1 SCC 391 : 2007
(12) SCR 883; Railway Board v. C.R.
Rangadhamaiah (1997) 6 SCC 623 : 1997 (3)
c Suppl. SCR 63 ; Prabodh Verma and Others v.
State of Uttar Pradesh and Others (1984) 4 SCC
251 : 1985 (1) SCR 216; /shwar Singh v. Ku/dip
Singh and others 1995 Supp (1) SCC 179; Tridip
Kumar Dingal and other v. State of West Bengal
D and Others (2009) 1 sec 768 : 2008 (15)
SCR 194; State of Assam v. Union of India and
Others (2010) 10 sec 408: 2010 (12) SCR 413;
Public Service Commission, Uttranchal v. Mamta
Bisht and Others (2010) 12 SCC 204 : 2010 (7)
E SCR 289; Union of India and others v. Dhanwanti
Devi and others (1996) 6 SCC 44 : 1996 (5)
Suppl. SC~ 32 ; Ram Swarup & Ors. vs. S.N.
Maira &Ors. (1999) 1SCC738: 1998 (3) Suppl.
SCR 617; Ramesh Hirachand Kundanmal vs.
F Municipal Corporation of Greater Bombay & Ors.
(1992) 2 sec 524 : 1992 (2) SCR 1; Razia
Begum vs. Anwar Begum AIR 1958 SC 886 : 1959
. SCR 1111 - referred to.
Quinn v. Leathern (1901) AC 495- referred to.
G Case Law Reference
2008 (1)ADJ 718 referred to Para 5
1963 Suppl. SCR 676 · referred to Para 14 ·
2012 (6) SCR 128 referred to Para 15
H
POONAM v: STATE OF U.P. 569
..
(2015) 3 SCALE 39 referred to Para 16 A
1955 SCR 1104 referred to Para 16 ·
1974 {3) SCR 207 referred to Para 18
AIR 1969 AP 204 . referred to Para 19
B
ILR (1973) 2 Delhi 392 · referred to Para 19
1992 Supp (2) sec 251 referred to Para 19
AIR 1978 Ker 176 referred to : Para 19
AIR 1979 Pat 266 referred to Para 19 c
1983 (2) SCR 936 referred to Para 19
2008 (3) SCR 497 referred to Para 20
. 2001 (2) SCR 1183 .· referred to ·. Para 20
2003 (2) SCR 968 referred to Para 20 D
2011 (5) SCR 460 explained Para 22
· (2008) 12 sec 112 referred to Para 24
2007 (12) SCR 883 referred to Para 24
E
1997 (3) Suppl. SCR 63 referred to P~ra 24
1985 (1) SCR 216 referred to Para.28
1995 supp (1) scc.119 referred to Para 31
2008 (15) SCR 194 referred to Para 33 F
2010 (12) SCR 413 referred to Para35
2010 (7) SCR 289 referred to Para 37
(1901)AC 495 referred to Para 40
1996 (5) Suppl. SCR 32 referred to Para 41 ~
(1995) 2 sec 326 distinguished Para44
{2011)2SCC54 . distinguished Para 45
1998 (3) Suppl. SCR 617 referred to Para 48
H
570 SUPREME COURT REPORTS [2015] 14 S.C.R.
A 1992 (2) SCR 1 referred to Para 49
1959 SCR 1111 referred to Para 49
CIVIL APPELLATE JURISDICTION: Civil Appeal NQ ..
6774 of 2015. · ..
B From the Judgment and Order dated 03.04.2012 in Writ
C No. 163.90 of 2012 passed by the Hon'ble High Court at
Allahabad.
Dushyant Parashar, Adv. for the Appellant.
c Vikrant Yadav, Gaurav Dhingra, Advs. for the
Respondent. · ··
The Judgment of the Court was delivered by
DIPAK MISRA, J. 1. The appellant invoked the
D jurisdiction of the High Court of Judicature atAllahbad under
Article 226 of the Constitution praying, inter a/ia, for issue of
writ of certiorari for quashment of the order <;lated 2.3.2012
passed by the respondent no.2, Commissioner, Azamgarh
Division, Azamgarh in Appeal No. 85/109/153/334/M of
E 2008-12 and further seeking a writ of Mandamus against the
respondents not to interfere in the peaceful functioning of fair
price shop in Gram Sabha Ardauna, Tehsil Sadar, District Mau.
2. The facts that formed the bedrock of the writ petition
are that a fair price shop being shop n0. 2 was run by the 5•h
F respondent in Gram Sabha Ardauna, Tehsil Sadar, Block
Ratanpura, District Mau, which was allotted to him by allotment
order dated 11.5.2001 and while he was continuing, on various
complaints being made againsf him pertaining to non-
distribution of essential commodities, Sub-Divisional .
G Magistr.ate, Sadar, District Mau ordered an enquiry and after
obtaining the report, suspended his licence and called for an
explanation from him vide order dated 30.5.2008. As the
factual matrix 1.yould depict vide order dated 3.6:2008 the shop
of respondent no.5 was attached to another shop being run by
H
. l ..
POONAMv. STATE OF U.P. 571
[DIPAK MISRA, J.]
one Bhupendra Singh and the respondent no.5 handed over A
the charge of shop on 19.7.2008. On the said date the final
enquiry report was placed before the· Deputy District
Magistrate, Sadar, District Mau and the report reflected that
there was improper distribution of essential commodities in
yiolation of instructions and accordingly the competent authority B
. by"its order dated 23.7.2008 cancelled the allotment of the
respondent no.5.
3. Being dissatisfied with the order of cancellation, the
5th Respondent preferred an appeal before the Commissioner,
Azamgarh assailing the order dated 23.7 .2008, along with an C
application for stay of the cancellation of allotment, but the
appellate authority declined to pass any interim protective ·
order. Eventually, the appeal preferred by the appellant was
allowed. May it be stated that the appellant herein had got
herself impleaded in the appeal on the ground that she had D
been allotted the shop no.2 after cancellation of the allotment
along with the licence granted iri favour of the original allottee, ·
the appellant therein.
'
4. The appellate authority after hearing the appellant and
the imp leaded party and uponperusal of the file, opined that E
the entire proceeding against the original allottee was initiated ·
on the basis of the oral statements pertaining to the allegations
made by some BPL card holders that the shopkeeper had
. told them that their cards had been cancelled; and there was F
no enquiry and investigation by the Deputy District Magistrate
from lhe official doc;:uments as regards the cancellation of
original ration.cards'ofthe BPL card holders; thatthe allottee
wa!i not provided the copy of the irwestigatiori report and hence,
he was deprived of opportunity to submit his clarification and· G
on the whol~. there were serious procedural.lapses; and that
on a careful scrutiny of number of aspects, it was perceptible
that the investigation carried out by the Block Development
Officer was absolutely f<!ulty. Being .of this view, the appellate
authority by order dated 2.3.2012, allowed the appeal of the H
572 SUPREME COURT REPORTS [2015] 14S.C.R.
. A appellant, restored the. allotment and cancelled the allotment
of the subsequent allottee.
· 5. Aggrieved by the aforesaid order, the appellant herein
who was the subsequent allottee in respect of shop no.2
preferred C.M.W.P. No. 16390 of 2012 before the High Court
B which by the impugned order dated 3.4.2012 relied upon an
earlier judgment in Sri Pal Yadav v. State of U.P. and others1
and dismissed the writ petition on the ground that she had no
a
right to continue the litigation being subsequent allottee, for
she had no independent right.
G
6. Calling in question the legal defensibility of the order
passed by the writ court, it is submitted 'by Mr. Dushyant
Parashar, learned counsel for the appellant is that the approach
of the High Court is absolutely erroneous inasmuch as it had
treated the allotment of the appellant in respect of the fair price
0
shop as a stop gap arrangement and she had. entered into the
shoes of the original allottee and, therefore, her allotment was
subject to attainment of finality of cancellation order totally
remaining oblivious to the fact that she was appointed as a
E dealer under Visually Handicapped quota. It .is further urged
by him that her rights being independent in nature, she has a
right to assail the appellate order and the High Court could not
have dismissed the writ petition without adverting to the merits
of the case.
F 7. Mr. Vikrant Yadav, learned counsel appearing for the
State, per contra, would contend that in the village Ardauna,
two fair price shops were in existence and ~ne was allotted to
Mr. Bhupinder Singh and the other one to Mr. Arvind Kumar,
the 51h respondent herein and on the basis of the complaint
G made by the Gram Sabha, the Sub-Divisional Magistrate had
attached the shop of respondent no.5 to the shop of Bhupinder
Singh, a.fter suspending his licence on 3.6.200~ and eventually,
an order of cancellation was passed; and when the order of
1
2008 (1)ADJ 718
H
POONAM v. STATE OF U.P. 573
[DIPAK MISRA, J.]
cancellation was set aside in appeal, the original allottee is A
entitled to get back his allotment in respect of shop no.2. and
hence, the appellant has no legal right to assail the order
passed by the appellate authority. Learned counsel for the
State would further submit that shop no.2 h9ving become
available and there being no order that said shop is declared B
as the shop reserved for any kind of quota, either vertical or
horizontal, the present appellant cannot assert any independent
right in respect of the said shop.
8. At the very outset, we must unequivocally state that we
are not required to enter into the issue whether cancellation C
was justified or not or the order passed by the appellate
authority allowing the appeal is defensible in the facts and
circumstances of the case, for the High Court has expressed
its disinclination to enter into the said arena at the instance of
the present appellant on the foundation that she was an allottee D
after the cancellation of the allotment who was the licencee to
run the fair price shop of the 5'" respondent. Learned counsel
for the appellant has also rightly not advanced any argument
in that regard except emphasising on the facet that as the
appellant had an independent right on her own the High Court E
was under the lawful obligation to address itself with regard to
legal substantiality of the order passed by the appellate
authority on the touchstone of exercise of writ jurisdiction,
however restricted it may be. To bolster the said submission,
immense emphasis is placed on the nature of the allotment F
made in favour of the appellant.
9. Be it noted, before the appellate authority, the appellant
had got herself impleaded after coming to know that the 5'"
respond~nt had preferred an appeal challenging the order of
cancellation, and the appellate authority had considered the G
submissions of the original allottee as well as the present
appellant. The thrust of the matter is whether the appellant
can be regarded as a person who is a necessary party to the
lis in such a situation and is entitled under law to advance the
H
574 SUPREME COURT REPORTS [2015] 14S.C.R.
A argument that the order passed by the appellate forum being
legally unsustainable, the writ court was obliged to adjudicate
the controversy on merits.
10. It is an admitted position that village Ardauna had
initially two shops. Shop no.2 was allotted in favour of the 5'"
B respondent and he was granted licence to run the fair price
shop. On the basis of certain complaints being received the
competent authority after an enquiry had cancelled the licence.
The appellate authority after ascribing certain reasons, has
overturned the said order. The effect of the said order has to
C be that the original allottee remains an allottee and his licence
continues. The appeal was preferred challenging the
cancellation of allotment and the order of licence. It is not a
situation where the appeal had been treated to have been
rendered infructuous on the basis of any subsequent event,
D such as, the shop in question has been demarcated for any
reserved category. In that event, such subsequent fact would
have been brought to the notice of the appellate authority and
in that event, possibly no relief could have been granted by the
appellate authority to the appellant except removing the stigma.
E The stand of the State is that initially the shop no.2 was attached
to the other licencee and thereafter on the basis of the
resolution passed by the Gram Sabha, it was allotted to the
present appellant though it was mentioned that it had been
granted under the visually impaired quota. But the character
F of the shop remained the same.
11. At this juncture, it is obligatory on our part to refer to
the letter-circular dated 1.2.2009 issued by the Chief Secretary,
which refers to the Government Order dated 17.8.2002 in
respect of the scheduled caste, scheduled tribe and other
G backward classes. Thereafter, there is reference to certain
horizontal reservation which refers to the ladies of certain
reserved categories, family members of the army who had
expired in the concerned reserved category, ex-army
H personnel, freedom fighters of the concerned reserved
POONAM v. STATE OF U.P. 575
(DIPAK MISRA, J.]
categories and their wives and the handicapped persons of A
the concerned category. After so stating, the circular proceeds
to mention as under:-
"ln this regard I was direction to say that for the allotment
of FPS shop in the rural and urban area, according to
the above arrangement Horizontal reservation is also B
·approved, under which there is arrangement to give 02%
· reservation to the candidate of handicapped persons.
In view of the problem of the blind persons after
appropriate consideration, the administration has
decided that the blind handicapped be granted 1% C
reservation under Horizontal reservation. In this manner
now to the handicapped person in place of 2% shall be
approved 3% reservation and in this manner 1%
increased reservation shall be approved only for the
handicapped of blind persons. In this manner in para D
no.3 of the Govt order sub para Gh adding para 3(d), the
handicapped person shall be granted 1% reservation.
In this manner Horizontal reservation shall be 36% in
place of 35% which is under the total reservation category E
of50%."
12. After issue of the said circular, a further letter dated
12.8.2008 was issued which mentioned the subject granting
priority to the blind handicapped for completing the backlog in
the vacant fair price shops under the public distribution system· F
in rural and urban area. It is relevant to produce certain
paragraphs of the said circular:-
"1. Through Govt. order no. 2715/29-6-02-162-Sa/01
dated 17'h August, 2012 for the allotment of FPS shop
for the implementation of reservation has been issued G
guidelines and for the reserv"ation of FPS shop also
applied the Horizontal arrangement. Under the above
arrangement there is the provision to grant 2%
reservation to the handicapped. In the above horizontal
H
576 SUPREME COURT REPORTS [2015) 14 S.C.R.
A there was no clear arrangement for blind handicapped
·persons. Vide Govt. order no. 311/29.06.08-162 SA/01
T.C. dated 01 February, 2008 amending the above Govt.
order granted one percent horizontal reservation to
handicapped blind person.
B 2. It came in the notice of the administration that in regard
to the reservation of blind handicapped persons vide
Govt. order they are not getting the representation. It is
pertinent to mention here that in the entire district of the
state given the direction on the administration level to
c complete the quota of reservation. The administration
after appropriate consideration has taken decision till
then backlog cannot completed for the present
reservation of the blind. since then the blind person should
be granted first priority in the allotment of the shop. in
D consideration they are fulfilling the prescribed condition
issued by the Govt for the allotment of the shop. In case
that resident of gram Sabha, who is entitled, the blind do
not apply then the resident of concern Gram Sabha block
development area, other blind person shall be entitled to
E apply. In the allotment of FPS shop under Public
Distribution system on the basis of total shop the
reservation should be assessed. Up to the completion
of blind handicapped should not furnish the shop from
any category. under the public distribution system in
F regard to FPS shop time to time issued Govt order should
be treated amended up to this limit."
[underling is ours]
13. Though, the narration offacts is reflective of a different
G contour of controversy. i.e., allotment and grant of licence for a
fair price shop, the seminal issue, as noted hereinabove, would
hinge on the answer to the question pertaining to right to assail
the order passed in appeal. The appellant was not impleaded
as a party in the appeal but she herself got impleaded.
H Assuming the appellant authority would have decided the
POONAMv. STATE OF U.P. 577
[DIPAK MISRA, J.)
appeal in favour of the original allottee in her absence, could A
the present appellant, a subsequent allottee in respect of the
same shop, have been allowed in law to make a grievance by
invoking the jurisdiction of any statutory forum or for that matter
the High Court under Article 227 of the Constitution. In essence,
whether she is a necessary party to the litigation and entitled B
to contest the legal vulnerability of the order of cancellation or
in any manner advance the plea that her allotment would not
be affected despite the. factum that the order of cancellation of
the earlier allottee has been quashed. To appreciate the said
issue we will dwell upon certain authorities though they may C
pertain to different jurisprudence.
14. First, it is necessary to understand about the concept
of necessary and proper party. A Four-judge Bench in Udit
Narain Singh Malpaharia v Additional Member Board of
Revenue, Bihar and another2 has observed thus:- D
"7 .... .it would be convenient at the outset to ascertain
who are necessary or proper parties in a proceeding.
The law on the subject is well settled: it is enough if we
state the principle. A necessary party is one without whom E
no order can be made effectively; a proper party is one
in whose absence an effective order can be made but
whose presence is necessary for a complete and final.
decision on the question involved in this proceeding."
15. In Vijay Kumar Kaul and others v. Union of India F
3
and others the court referred to the said decision and has
opined thus:-
"36. Another aspect needs to be highlighted. Neither
before the Tribunal nor before the High Court, Parveen
Kumar and others were arrayed as parties. There is no G
dispute over the factum that they are senior to the
appellants and have been conferred the benefit of
2
AIR.1963 SC 786
3
(2012)7SCC610
H
578 SUPREME COURT REPORTS [2015] 14 S.C.R.
A promotion to the higher posts. In their absence, if any
direction is issued for fixation of seniority, that is likely to
jeopardise their interest. When they have not been
impleaded as parties such a relief is difficult to grant.
-
37. In this context we may refer with profit to the decision
8 in lndu Shekhar Singh v. State of U.P. 4 wherein it has
been held thus: (SCC p. 151, para 56)
"56. There is another aspect of the matter. The appellants
herein were not joined as parties in the writ petition filed
c by the respondents. In their absence, the High Court
could not have determined the question of inter se
seniority." ·
38. In Public Service Commission v. Mamta Bisht5 this
Court while dealing with the concept of necessary parties.
D and the effect of non-impleadment of such a party in the
matter when the selection process is assailed observed
thus: (SCC pp. 207-08, paras 9-10)
"9 .... in Udit Narain Singh Malpaharia v. Board of
Revenue 6 , wherein the Court has explained the
E distinction between necessary party, proper party and
proforma party and further held that if a person who is
likely to suffer from the order of the court and has not
been impleaded as a party has a right to ignore the said
order as it has been passed in violation of the principles
F of natural justice. More so, proviso to Order 1 Rule 9 of
the Code of Civil Procedure, 1908 (hereinafter called
'CPC') provides that non-joinder of necessary party be
fatal. Undoubtedly, provisions of CPC are not applicable
in writ jurisdiction by virtue of the provision of Section
G 141 CPC but the principles enshrined therein are
applicable. (Vide Gu/abchand Chhotala/ Parikh v. State
• (2006) asec 129
, (2010) 12 sec 204
H 'AIR 1965 SC 786
POONAM v. STATE OF U.P. 579
[DIPAK MISRA, J.]
·of Gujarat', Babubhai Muljibhai Patel v. Nandlal A
Khodidas Barot8 and Sarguja Transport Service v.
STAP.)
10. In Prabodh Verma v. State of U.P. 10 and Tridip Kumar
Dingal v. State of W B. 11 , it has been held that if a person
challenges the selection process, successful candidates B
or at least some of them are necessary parties."
16. At this juncture, it is necessary to state that in Udit
Narain (Supra) question arose whether a tribunal is a
necessary party. Recently a two-Judge Bench in Asstt. G.M c
State Bank of India v. Radhey Shyam Pandey 12 referred to
Hari Vishnu Karnath v. Ahmad lshaque and Ors. 13 and
adverted to the concept of a tribunal being a necessary party
and in that context ruled that:-
" In Hari Vishnu Karnath (supra), the larger Bench was D
dealing with a case that arose from Election Tribunal
which had ceased to exist and expressed the view how
it is a proper party. In Udit Narain Singh (supra), the
Court was really dwelling upon the controversy with regard
to the impleadment of parties in whose favour orders had E
"been passed and in that context observed that tribunal
is a necessary party. In Savitri Devi (supra), the Court
took exception to courts and tribunals "being made
parties. It is apposite to note here that propositions laid
down in each case has to be understood in proper F
perspective. Civil courts, which decide matters, are
courts in the strictest sense of the term. Neither the court
nor the Presiding Officer defends the order before the
7
AIR 1965 SC 1153
• (1974) 2 sec 706 G
• (1987) 1 sec 5
10
(1984)4 sec 251
11
(2009) 1 sec 768
12
2015 (3) SCALE 39
13
AIR 1955 SC 233 H
580 SUPREME COURT REPORTS [2015] 14S.C.R.
A superior court it does not contest. If the High Court, in
exercise of its writ jurisdiction or revisional jurisdiction,
as the case may be, calls for the records, the same can
always be called for by the High court without the Court
or the Presiding Officer being impleaded as a party.
B Similarly, with the passage of time there have been many
a tribunal which only adjudicate and they have nothing to
do with the lis. We may cite few examples; the tribunals
constituted under the Administrative TribunalsAct, 1985,
the Custom, Excise & Service Tax Appellate Tribunal,
c the Income Tax Appellate Tribunals, the Sales Tax Tribunal
and such others. Every adjudicating authority may be
nomenclatured as a tribunal but the said authority(ies)
are different that pure and simple adjudicating authorities
and that is why they are called the authorities. An Income
o Tax Commissioner, whatever rank he may be holding,
when he adjudicates, he has to be made a party, for he
can defend his order. He is entitled to contest. There
are many authorities under many a statute. Therefore,
the proposition that can safely be culled out is that the
E authorities or the tribunals, who in law are entitled to
defend the orders passed by them, are necessary
parties and if they are not arrayed as parties, the writ
petition can be treated to be not maintainable or the court
may grant liberty to implead them as parties in exercise
F of its discretion. There are tribunals which are not at all
required to defend their own order, and in that case such
tribunals need not be arrayed as parties."
The principle that has been culled out in the said case is
that a tribunal or authority would only become a necessary party
G which is entitled in law to defend the order.
17. The term "entitled to defend" confers an inherent right
to a person if he or she is affected or is likely to be affected by
an order to be passed by any legal forum, for there would be
violation of natural justice. The principle of audi alteram
H
POONAM v. STATE OF U.P. 581
[DIPAK MISRA, J.]
partem has its own sanctity but the said principle of natural A
justice is not always put in strait jacket formula. That apart, a
person or an authority must have a legal right or right in law to
defend or assail.
18. We may first clarify that as a proposition of law it is
not in dispute that natural justice is not an unruly horse. Its B
applicability has to be adjudged regard being had to the effect
and impact of the order and the person who claims to be
affected; and that is where the concept of necessary party
become significant. In The General Manager, South Central
Railway, Secunderabad and another v. A. V.R. Siddhantti C
and Others 14 the Court was dealing with an issue whether the
private respondent therein had approached the High Court
under Article 226 of the Constitution for issue of a writ of
mand<Jmus directing the General Manager, South Central
Railway and the Secretary, Railway Board to fix the inter se, D
seniority as per the original proceedings, dated 16.10.1952,
of the Railway Board and to further direct them not to give effect
to the subsequent proceedings dated 2.11.1957 and
13.0\ .1961 of the Board issued by way of "modification" and
'clarification" of its earlier proceedings of 1952. The High E
Court accepted the contentions of the private respondent and
struck down the impugned proceedings. A contention was
canvass~d before this Court that the writ petitioners had not
impleaded about 120 employees who were likely to be affected
by the decis!9n and, therefore, there being non-impleadment F
despite they being necessary parties, it was fatal to the
decision. Rejecting the said submission the court held:-
"As regards the second objection, it is to be noted that
the decisions of the Railway Board impugned in the writ G
petition contain administrative rules of general
application, regulating absorption in permanent
departments, fixation of seniority, pay etc. of the
employees of the erstwhile Grain Shop Departments.
"(1974)4 sec 335
H
582 · SUPREME COURT REPORTS [2015] 14 S.C.R.
A The respondents-petitioners are impeaching the validity
of those policy decisions on the ground of their being
violative of Articles 14 and 16 of the Constitution. The
proceedings are analogous to those in which the
constitutionality of a statutory rule regulating seniority of
B Government servant is assailed. In such proceedings the
necessary parties to be impleaded are those against
whom the relief is sought, and in whose absence no
effective decision can be rendered by the Court. In the
present case, the relief is claimed only against the
c Railway which has been impleaded through its
representative. No list or order fixing seniority of the
petitioners vis-a-vis particular individuals, pursuant to the
impugned decisions, is being challenged. The
employees who were likely to be affected as a result of
D the re-adjustment of the petitioner's seniority in
accordance with the principles laid down in the Board's
decision of October 16, 1952, were, at the most, proper
parties and not necessary parties, and their non-joinder
could not be fatal to the writ petition."
E 19. The court further agreed with the principle stated in
B. Gopalaiah and Ors v. Government ofAndhra Pradesh 15,
J.S. Sachdev and Ors. v. Reserve Bank of India, New
Delhi1 6 and Mohan Chandra Joshi v. Union of India and
Ors. 17 In this context reference to the authority in State of
F Himachal Pradesh and another v. Kai/ash Chand Mahajan
and Others 18 would be appropriate. In the said case a
contention was raised that non-impleadment of the necessary
party was fatal to the writ petition. In support of the said stand
reliance was placed upon two decisions of two different High
G Courts; one, State of Kera/av. Miss Rafia Rahim 19 and the
15
AIR 1969 AP 204
16
ILR (1973)2 Delhi 392
17
C.W. No. 650of1970, decided by Delhi High Court
18 1992 Supp (2) sec 251
H "AIR 1978Ker176
POONAM v. STATE OF U.P. 583
[DIPAK MISRA, J.]
other in Padamraj v. State of Bihar2°. The Court distinguished A
both the decisions by holding thus:-
"The contention of Mr Shanti Bhushan that the failure to
implead Chauhan will be fatal to the writ petition does
not seem to be correct. He relies on State of Kera/a v.
Miss Rafia Rahim. That case related to admission to B
medical college whereby invalidating the selection vitally
affected those who had been selected already. Equally,
the case Padamraj Samarendra v. State of Bihar, has
no application. This was a case where the plea was
founded in Article 14 and arbitrary selection. The C
selectees were vitally affected. The plea that the decision
of the court in the absence of Chauhan would be violative
of principle of natural justice as any adverse decision
would affect him is not correct."
D
The Court placed reliance on A. Janardhana v. Union
of lndia 21 and ultimately did not accept the submission that
the writ petition was not maintainable because of non-
impleadment of the necessary party.
20. In this context the authority in Sadananda Halo and E
Others v. Momtaz Ali Sheikh and Others22 is quite pertinent.
The Division Bench referred to the decision in All India SC &
ST Employees' Assn. v. A. Arthur Jeen 23 wherein this court
had addressed the necessity in joining the necessary
candidates as parties. The Court referred to the principle of F
natural justice as enunciated in Canara Bank v. Debasis
Das24 • We may profitably reproduce the same:-
"Natural justice has been variously defined. It is another
name for common sense justice. Rules of natural justice
are not codified canons. But they are principles ingrained G
20
AIR 1979 Pat 266
21
(1983)3SCC601
22
(2008)4 sec 619
" (2001l6 sec 380
" (2003) 4 sec 557
H
584 SUPREME COURT REPORTS [2015] 14S.C.R.
A into the conscience of man. Natural justice is the
administration of justice in a common sense liberal way.
Justice is based substantially on natural ideals and
human values. The administration of justice is to be freed
from the narrow and restricted considerations which are
B usually associated with a formulated law involving
linguistic technicalities and grammatical niceties. It is the
substance of justice which has to determine its form.
Principles of natural justice are those rules which have
been laid down by the courts as being the minimum
c protection of the rights of the individual against the
arbitrary procedure that may be adopted by a judicial,
quasi-judicial and administrative authority while making
an order affecting those rights. These rules are intended
to prevent such authority from doing injustice."
D And again:-
"Concept of natural justice has undergone a great deal
of change in recent years. Rules of natural justice are not
rules embodied always expressly in a statute or in rules
framed thereunder. They may be implied from the nature
E
of the duty to be performed under a statute. What
particular rule of natural justice should be implied and
what its context should be in a given case must depend
to a great extent on the facts and circumstances of that
case, the framework of the statute under which the enquiry
F
is held. The old distinction between a judicial act and an
administrative act has withered away. The adherence to
principles of natural justice as recognised by all civilised
States is of supreme importance .... "
G 21. We have referred to the aforesaid passages as they
state the basic principle behind the doctrine of natural justice,
that is, no order should be passed behind the back of a person
who is to be adversely affected by the order. The principle
behind proviso to Order I Rule 9 that the Code of Civil
H Procedure enjoins it and the said principle is also applicable
POONAM v. STATE OF U.P. 585
[DIPAK MISRA, J.]
to the writs. An unsuccessful candidate challenging the A
selection as far as the service jurisprudence is concerned is
bound to make the selected candidates parties.
22. In J.S. Yadav Vs State of U.P. &Anr'25 in Paragraph
31 it has been held thus:-
B
"No order can be passed behind the back of a person
adversely affecting him and such an order if passed, is
liable to be ignored being not binding on such a party as
the same has been passed in violation of the principles
of natural justice. The principles enshrined in the proviso c
to Order 1 Rule 9 of the Code of Civil Procedure, 1908
provide that impleadment of a necessary party is
mandatory and in case of non-joinder of necessary party,
the petitioner-plaintiff may not be entitled for the relief
sought by him. The litigant has to ensure that the 0
necessary party is before the court, be it a plaintiff or a
defendant, otherwise the proceedings will have to fail. In
service jurisprudence if an unsuccessful candidate
challenges the selection process, he is bound to implead
· at least some of the successful candidates in E
representative capacity. In case the services of a person
are terminated and another person is appointed at his
place, in order to get relief, the person appointed at his
place is the necessary party for the reason that even if
the petitioner-plaintiff succeeds, it may not be possible F
for the Court to issue direction to accommodate the
petitioner without removing the person who filled up the
post manned by the petitioner-plaintiff. (Vide Prabodh
Verma V. State of U.P, lshwar Singh Vs. Kuldip Singh,
Tridip Kumar Dingal Vs. State ofW.B, State of Assam V.
Union of India and Public Service Commission V. Mamta G
Bisht). More so, the public exchequer cannot be
burdened with the liability to pay the salary of two persons
against one sanctioned post".
"(2011) 6 sec 570 H
586 SUPREME COURT REPORTS [2015) 14 S.C.R.
A 23. To appreciate the said decision in a real perspective,
it is absolutely necessary to state the facts under which the
decision was rendered and such a statement of law was made.
The issue that arose before this Court related to an order
passed by the High Court of Allahabad by which it had
B dismissed the writ petition filed by the appellant challenging
the notification dated 28.05.2008 by which on the date of '
constitution of the Uttar Pradesh State Human Rights
Commission, the appellant was declared to cease to hold the
office as a member of the said commission. This Court noted
c the facts which were relevant and germane for the disposal of
the appeal in paragraph 2. The appellant therein was appointed
as a member of the Commission on 29.06.06 for a period of
five years. Certain provisions of the Protection of Human Rights
Act 1993, stood amended vide the Protection of Human Rights
o (Amendment Act, 2006) which came into force on 23.11.2006.
After completion of the tenure by Chairperson of the
Commission and other members in October 2007, the
appellant remained the lone working member of the
Commission. The State Government issued the notification
E on 28.05.2008 to the effect that the appellant had ceased to
hold the office as a Member of the Commission. The said
notification was challenged on the ground that he had been
appointed for a tenure of five years and that period could not
be curtailed. The appellant had not impleaded any of the
F members who had been appointed as members on
06.06.2008. Various contentions were raised on behalf of
the appellant and the said submissions were resisted by the
State on two counts, namely, that the appellant had not
impleaded the newly appointed members as parties and further
G he had suffered the disability by virtue of the operation of the
amended law. This court referred to the provision contained
in unamended Section 21 (2) of the Act and the Amended
Section 21 (2) of the Act. Prior to the amendment, the
qualification prescribed for Member was "a person who is or
H
POONAM v. STATE OF U.P. 587
[DIPAK MISRA, J.]
-
has been a District Judge in that State" and after the amendment A
the qualification of the member was changed to the extent "he
is or has been a Judge of a High Court or District Judge in the
State with a minimum of 7 years experience as a District
Judge". The court referred to Article 236( a) of the Constitution
and Section 3(17) of the General Clauses Act, 1897. Be it B
stated, the contention was advanced that a person who has
gained experience as an Additional District Judge, he would
be entitled for consideration as his experience is equivalent
to that of a District Judge. Repelling the said submission, the
Court held:- C
"12. The aforesaid submission seems to be very attractive
but has no substance for the reason that a cadre generally
denotes a strength of a service or a part of service
. sanctioned as a separate unit. It also includes sanctioned
strength with reference to grades in a particular service. D
Cadre may also include temporary, supernumerary and
shadow posts created in different grades. The
expressions "cadre", "posts" and "service" cannot be
equated with each other. (See Union of India v. Pushpa
Rani and State of Karnataka v. K. Govindappa 26 .) There E
is no prohibition in law to have two or more separate
grades in the same cadre based on an intelligent
differential. Admittedly, the post of District Judge and
Additional District Judge in the State of U.P. is neither
interchangeable nor intertransferable. The aforesaid F
Rules merely provide for an integrated cadre for the
aforesaid posts. Thus, the submission is liable to be
rejected being preposterous.
xxx xxx xxx
G
14. In such a fact situation, we do not see any cogent
reason to take a view contrary to the same for the reason
that in case the legislature in its wisdom has prescribed
a minimum experience of seven years as a District Judge
"(2009) 1 sec ·1 H
588 SUPREME COURT REPORTS [2015) 14 S.C.R.
A knowing it fully well the existing statutory and constitutional
provisions, it does not require to be interpreted ignoring
the legislative intent. We cannot proceed with an
assumption that legislature had committed any mistake
enacting the said provision. Clear statutory provision in
B such a case is required to be literally construed by
considering the legislative policy. Thus, no fault can be
found with the impugned judgment and order of the High
Court on this count."
24. After so stating, the Court noted the fact that 2006
C amendment was not under challenge. However, it noted that
the issue agitated by the appellant was that the legislature never
intended to apply the amended provisions with retrospective
effect and, therefore, it could not be discontinued from the post,
for his rights stood protected by the provisions of Section 6 of
D the General Clauses Act. The Court referred to the authorities
in State of Punjab v. Bhajan Kaur'17 , Sangam Spinners v.
Reg/. ProvidentFundCommr. 26 , and RailwayBoardv. C.R.
Rangadhamaiah 29 and held as follows:-
"Thus, from the above, it is evident that accrued rights
E
cannot be taken away by repealing the statutory
provisions arbitrarily. More so, the repealing law must
provide for taking away such rights, expressly or by
necessary implication."
F 25. Thereafter, the Court proceeded to lay down as
follows:-
"There is no specific word in the 2006 Amendment Act
to suggest its retrospective applicability. Rather the
positive provisions of Section 1 suggest to the contrary
G as it reads:-
21
(2008)12sec112
2
(2000) 1 sec 391
•
" (1997) 6 sec 623
H
POONAM v. STATE OF U.P. 589
[DIPAK MISRA, J.]
"1. Short title and commencement.-( 1) *** A
(2) It shall come into force on such date as the Central
Government may, by notification in the Official Gazette,
appoint."
Undoubtedly, the amended provisions came into force B
on 23-11-2006 vide S.O. 2002 (E), dated 23-11-2006,
published in the Gazette of India, Extra Pt. II, Section 3(iJ)
dated 23-11-2006. In fact, the date 23-11-2006 is the
pointer.and puts the matter beyond doubt. Thus, in view
of the above, we do not have any hesitation to declare c
that the Notification dated 28-5-2008 is patently illegal."
26. After so stating, in paragraph 32 of the judgment, the
Court held thus:-
"The appellant did not implead any person who had been
appointed in his place as a Member of the Commission. D
More so, he made it clear before the High Court that his
cause would be vindicated if the Court made a
declaration that he had illegally been dislodged/restrained
to continue as a Member of the Commission. In view of
the above, he cannot be entitled to any other relief except E
the declaration in his favour which had been made
herein above that the impugned Notificatio.n dated 28-5-
2008 is illegal."
27. On a keen understanding of the aforesaid authority, F
two aspects are clear. First, it had noted the fact what was
pleaded before the High Court that the selected members were
not arrayed as parties. Thereafter, it had proceeded to deal
with the distinction between a District Judge and an Additional .
District Judge, that is, for the purpose of meeting the G
qualification under the amended Act. Thereafter, as is manifest,
it proceeded to analyse the retrospective applicability of the
am'O'nded provision and opined that the provision is not
retrospectively applicable and, therefore, notification is bad in
law. Paragraph 31 of the decision proceeded to state that H
590 SUPREME COURT REPORTS (2015] 14 S.C.R.
A unless necessary parties are arrayed, no relief can be granted.
lrrefragably, there can be no cavil over the said proposition of
law. Thereafter, the Division Bench proceeded to state that in
case the services of a person are terminated and another
person is appointed in his place, in order to get the relief, the
B person appointed at his place is the necessary party for the
reason that even if the petitioner succeeds, it may not be
possible for the Court to issue a direction to accommodate
the petitioner without removing the person who filled up the
post manned by the petitioner. To arrive at the s~id conclusion,
c five authorities have been relied upon. We shall discuss at
length the said decisions.
28. We shall deal with the authorities in seriatim. A three-
judge Bench decision in Prabodh Verma and Others v. State
of Uttar Pradesh and Others 30 requires to be addressed.
D The facts in the said case deserved to be stated. In the said
case the principal question that arose for determination before
this Court was the constitutional validity of two Uttar Pradesh
Ordinances, namely, (1) The Uttar Pradesh High Schools and
Intermediate Colleges (Reserve Pool Teachers) Ordinance,
E 1978 (U.P. Ordinance 10of1978), and (2) The Uttar Pradesh
High Schools and Intermediate Colleges Reserve Pool
Teachers) (Second) Ordinance, 1978 (U.P. Ordinance 22 of
1978). The High Court on certain reasons had struck down
the ordinance. Be it noted, the writ petition was filed by the
F Uttar Pradesh Madhyamik Shikshak Sangh. Apart from the
question of validity, the subsidiary question that arose before
this Court is whether the termination of the services of the
appellants and the petitioner before this Court as secondary
school teachers and intermediate college lecturers following
G upon the High Court judgment is valid and, if not, the relief to
which they are entitled. After narrating the facts, the Cou·rt
observed that the writ petition filed by the Sangh suffered from
two serious, thou_gh not incurable, defects. We think it
H "(1984)4 sec 251
POONAM v. STATE OF U.P. 591
[DIPAK MISRA, J.]
appropriate to reproduce the statement offacts as reproduced A
in the judgment.
"The first defect was that of non-joinder of necessary
parties. The only respondents to the Sangh's petition
were the State of Uttar Pradesh and its concerned
officers. Those who were vitally concerned, namely, the B
reserve pool teachers, were not made parties - not
even by joining some of them in a representative capacity,
considering that their number was too large for all of them
to be joined individually as respondents. The matter,
therefore, came to be decided in their absence. A High C
Court O\Jght not to decide a writ petition under Article
226 of the Constitution without the persons who would
be vitally affected by its judgment being before it as
respondents or at least by some of them being before it
as respondents in a representative capacity if their D
number is too large, and, therefore, the Allahabad High
Court ought not to have proceeded to hear and dispose
of the Sangh's writ petition without insisting upon the
reserve pool teachers being made respondents to that
writ petition, or at least some of them being made E
respondents in a representative capacity, and had the
petitioners refused to do so, ought to have dismissed
that petition for non-joinder of necessary parties."
29. Thereafter the Court proceeded to summarise its
conclusion and the relevant conclusion for the present purpose F
are reproduced below:-
"50 (1) A High Court ought not to hear and dispose of a
writ petition under Article 226 of the Constitution without
the persons who would be vitally affected by its judgment
being before it as respondents or at least some of them G
being before it as respondents in a representative
·capacity if their number is too large to join them as
respondents individually, and, if the petitioners refuse to
so join, then the High Court ought to dismiss the petition
for non-joinder of necessary parties. H
592 SUPREME COURT REPORTS [2015] 14 S.C.R.
A (2) The Allahabad High Court ought not to have
proceeded to hear and dispose of Civil Miscellaneous
Writ No. 9174 of 1978 - Uttar Pradesh Madhyamik
Shikshak Sangh v. State of Uttar Pradesh - without
insisting upon the reserve pool teachers being made
B respondents to that writ petition or at least some of them
being made respondents thereto in a representative
capacity as the number of the reserve pool teachers was
too large and, had the petitioners refused to do so, to
dismiss that writ petition for non-joinder of necessary
C parties."
30. On a studied perusal of the aforesaid judgment, it is
crystal clear that this Court had opined that when the
constitutional validity of a provision is challenged and there
are beneficiaries of the said provision, some of them in a
D representative capacity have to be made parties failing which
the writ court would not be justified in hearing a writ petition in
the absence of the selected candidates when they are already
appointed on the basis of the provision which was under assail
before the writ court.
E
31. In /shwar Singh v Ku/dip Singh and others 31 , a
two-Judge Bench was dealing with the situation where the
selection and consequent appointments were challenged by
unsuccessful candidates before the High Court primarily on
F the ground that the interviews held for the said selection were
a sham affair. The High Court had quashed the selection and
the appointments on the foundation that the interviews held
were neither fair nor proper thereby vitiating the selection. This
Court dislodged the order of the High Court on a singular count
G which is to the following effect: -
"It is not disputed by the learned counsel for the parties
that except lshwar Singh, no other' selected candidate
31 1995 Supp (1) sec 179
H
POONAM v. STATE OF U.P. 593
[DIPAK MISRA, J.]
was impleaded before the High Court. The selection and A
the appointments have been quashed entirely at their
back. It is further stated that even lshwar Singh, one of
the selected candidates, who was a party, had not been
served and as such was not heard by the High Court.
We are of the view that the High Court was not justified B
in hearing the writ petition in the absence of the selected
candidates especially when they had already been
appointed."
32. The decision in the aforesaid case is graphically clear
that the selection was under challenge but the selectees were C
not made parties. There can be no shadow of doubt that they
were necessary parties and, therefore, this Court expressed
the view, which we have reproduced hereinabove.
33. In Tridip Kumar Dinga/ and other v. State of West 0
Bengal and 0thers 32 an appeal was preferred by the
appellants being aggrieved and dissatisfied with the judgment
and order passed by the High Court of Calcutta. The facts
giving rise to the appeal by special leave before this Court
were thatthe State of West Bengal in the Department of Health E
and Family Welfare taking note of the acute shortage and non-
availability of adequate number of Medical Technologists, took
an initiative to fill up the requisite number of vacancies by taking
\JP the matter with Employment Exchange. A Memorandum
was issued by the Assistant Director of Health Services F
(Administration) to the Director of Employment Exchange for
sponsoring the names of candidates for the post of Medical
Technologists. Eventually, on the basis of the marks obtained
in the oral interview, a list was prepared. The candidates who
could not get entry into the select list challenged the same
before the West Bengal Administrative Tribunal. The tribunal G
granted liberty to the authorities to make appointments of the
candidates selected and empanelled subject to the result in
the Original Application. The matter at various times travelled
" (2009) 1 sec 768
H
594 SUPREME COURT REPORTS [2015] 14 S.C.R.
A to the High Court, which directed for disposal of the Original
Application. Eventually, the tribunal directed for preparation
of the fresh merit list on the basis of marks obtained in the
written examination and oral interview excluding those who were
already in service. The tribunal also observed that the
B Committee had fixed 40% as pass marks in the oral interview
and the said standard should be applied on the total marks as
pass marks and appointment should be given from the fresh
panel so prepared in order of merit subject to reservation and
filling up of vacant posts. The decision of the tribunal was
c challenged before the High Court and the High Court opined
that the question of retaining those candidates who had been
appointed must be considered afresh by the tribunal since the
tribunal had not assigned any reason as to why they should be
permitted to be continued in service. The High Court had
o expressed the view that no sympathy should have been shown
to the candidates when the tribunal itself had expressed the
opinion that the selection process was vitiated. Various other
reasons were also ascribed by the High Court. After remit,
the tribunal considering the rivalised submissions and taking
E an overall view of the matter found that the selection process
was bona fide and in accordance with law and, therefore, it
requires to be approved. The tribunal further held that
appointments which had already been made by the authorities
in respect of 190 candidates who had gained experience of
F more than three years of work of investigation entrusted to them
should not be disturbed. A direction was issued to the State
authorities to offer appointments to successful candidates in
th.e waiting list subject to the availability of vacancies following
medical examination and police verification. The said
G judgment was challenged before th·e High Court which set aside
the order of the tribunal and directed a fresh panel of Medical
Technologists to be prepared by the State Government on the
basis of the qualifying marks obtained both in the written test
as well as in the oral interview. Certain directions were given
H .,
POONAM v. STATE OF U.P. 595
[DIPAK MISRA, J.]
by the High Court including the one if those candidates who A
had already been appointed did not find place in the panel,
consequential orders would be made by the State Government
but those who were in the panel were accommodated if by
reason of existing vacancies, they should be accommodated.
The said order became the subject matter of special leave B
petition which was dismissed as withdrawn. As the order of
the High Court was not implemented, a contempt petition was
filed. An unconditional apology was offered on behalf of the
contemners stating that they were ready and willing to carry
out the directions. At that juncture, the High Court passed an C
interim order to the extent that Cou'rt was not inclined to issue
any direction for removal/termination of services of 66 persons
who were working since three to four years. The Court also
directed the State to report to the Court as regards the exact
number of vacancies which were available for the appointment D
of the panel to be prepared and to inform whether nine
vacancies which had become defunct could be revived. When
the matter was placed again on the next date, the High Court
noted that a panel of 586 candidates, had been prepared on
the basis of 40% marks obtainJ1d by candidates both in the E
written test as well as in the oral interview. It also observed
that 66 persons who had been appointed could be
accommodated by granting liberty to the State Government in
the manner it thought best without disturbing their seniority or
continuity of service. It further directed that remaining vacancies F
should be filled up on-the basis of seniority position from the
panel of 586 candidates. With the aforesaid directions, the
contempt petition was disposed of and the said order was
assailed before this Court. After hearing the learned counsel
for the parties, this Court came to hold that the contention on G
behalf of the State Government that written examination was
held for shortlisting the candidates and was in the nature of
elimination test had no doubt substance, forthe said authorities
regard being had to the large number of applicants seeking
H
596 SUPREME COURT REPORTS [2015] 14 S.C.R.
A appointment and small number of vacancies, had no other
option but to screen candidates by holding a written
examination more so, when there were no rules in that regard.
This Court further opined that it was an administrative decision
and such a plea was raised by the State in the first round of
B litigation before the tribunal which had held that the action of
State authorities to be wrong and the High Court upheld it and
State did not challenge the order before this Court and,
therefore, in the second round the High Court did not commit
any error of law in directing the authorities to prepare merit list
C on the basis of marks obtained by the candidates in written
examination as also in oral interview. It was further held that in
such a situation it was not open to the State authorities to
reiterate and reagitate the same ground on the same occasion.
A contention was raised on behalf of the appellant that there
D cannot be more than 15% marks at the oral interview, which
was not accepted by this Court at that stage, for such a direction
was issued as early as in 2000 and the appellants were.
applicants before the Tribunal and the petitioners before the
High Court had accepted the said decision and did not
E challenge the legality thereof by approaching this Court.
Thereafter, the Court proceeded to deal with the 66 candidates.
In that context it ruled as follows:-
"Regarding protection granted to 66 candidates, from
the record it is clear that their names were sponsored by
F the employment exchange and they were selected and
appointed in 1998-1999. The candidates who were
unable to get themselves selected and who raised a
grievance and made a complaint before the Tribunal by
filing applications ought to have joined them (selected
G candidates) as respondents in the original application,
which was not done. In any case. some of them ought to
have been arrayed as respondents in a "representative
capacity". That was also not done. The Tribunal was.
therefore. wholly right in holding that in absence of
H
POONAM v. STATE OF U.P. 597
[DIPAK MISRA, J.]
selected and appointed candidates and without affording A
opportunity of hearing to them. their selection could not
be set aside."
[Emphasis added]
34. We have referred to the said authority in a 8
comprehensive manner to understand the ratio. It is quite
simple. If a non-selected candidate challenges the selection,
he is under legal obligation to implead the selected candidates
as they are necessary parties and there can be no two opinions
as regards such a proposition of law. c
35. In State of Assam v. Union of India and Others 33
the State of Assam, being aggrieved by the decision rendered
in writ appeal and the dismissal of the review application filed
by it, had approached this Court. The factual matrix as was
presented before the Court was that Union of India had D
introduced "Family Welfare Scheme" under its Family Planning
Programme and under the said Scheme, there was a provision
for appointment of Voluntary Female Attendants on a monthly
honorarium of Rs.50/- per month from the inception of the
Scheme which was subsequently increased to Rs.100/- per E
month, w.e.f. February, 2001. As the factual narration would
show a writ petition was filed claiming benefit from the
respondents of the pay of Rs.900/- per month, the minimum of
the pay scale payable to the Voluntary Female Attendants. A
prayer was also made for regularisation. A direction was given F
by the High Court that it was for the State Government to
consider the prayers in accordance with law. A similar writ
was filed by another female attendant wherein the Union of
India and the State of Assam were arrayed as respondents
and the High Court disposed of the writ petition relying on the G
earlier judgment. The Union of India being aggrieved preferred
a writ appeal in which it did not implead the State of Assam as
a party to those proceedings. The contention of the Union of
India was that the voluntary female attendants were not their
33 (2010)10SCC408 H
598 SUPREME COURT REPORTS [2015] 14 S.C.R.
A employees and, therefore, the Single Judge was not correct
in issuing direction to the Union of India for payment of
minimum pay scale. It was urged that the State of Assam had
issued appointment letters to the said female attendants. There
was no mention in those appointment letters that they were
B appointed under the centrally sponsored scheme. A prayer
was made to discharge them of their liability of any payment
of wages to the private respondents appointed by the State
Government. The Division Bench accepted the stand of the
Union of India and held that the appointment letters had nothing
c to link them with the centrally sponsored scheme of voluntary
workers at fixed honorarium. On the basis of the aforesaid
analysis, the Division Bench observed that the Union of India
had no responsibility of making the payment on the minimum
of the pay scale to the voluntary female attendants, and fixed
o the liability on the State of Assam. Being aggrieved, the State
of Assam had preferred the appeal by special leave. The two-
Judge Bench referred to the decision in Udit Narain (supra)
. and opined thus:-
"15. In aid of his submission, the learned Senior Counsel
E has placed reliance on the law laid down by this Court in
Udit Narain Singh Malpaharia v. Board of Revenue,
wherein it was held that in proceedings for a writ of
certiorari, it is not only the tribunal or authority whose
order is sought to be quashed but also the parties in
F whose favour the said order is issued, are necessary
parties and that it is in the discretion of the court to add
or implead proper parties for completely settling all the
questions that may be involved in the controversy either
suo motu or on the application of a party to the writ or on
G application filed at the instance of such proper party.
16. We respectfully agree with the observations made
by this Court in Udit Narain case and adopt the same.
We may add that the law is now well settled that a
necessary party is one without whom, no order can be
H
POONAM v. STATE OF U.P. 599
[DIPAK MISRA, J.]
made effectively and a proper party is one in whose A
absence an effective order can be made but whose
presence is necessary for a complete and final decision
of the question involved in the proceeding.
JOO( JOO( JOO(
B
23. We are also unable to comprehend any possible
reasons for the Union of India to omit the State of Assam
from the array of parties in the writ appeals filed before
the Division Bench of the High Court. The fact remains
that they were not made parties to the proceedings. The c
High Court, in our view, while allowing the appeals filed
by the Union of India and shifting the liability of payment
of salary/wages to the Voluntary Female Attendants on
the State of Assam, should have taken a little more care
and caution to find out whether the State of Assam is D
arrayed as a party to the proceedings and whether they
are served with the notice of the appeals and in spite of
service, whether they have remained absent. This is the
least that is expected from the Court. Without making
this small verification, the Division Bench of the High E
Court has fixed huge recurring financial liability on the
State Government. In our opinion, in matters of this nature,
even by mistake of the party, the proper parties were not
arrayed in the proceedings, it is the duty of the Court to
see that the parties are properly impleaded. It is well- F
·settled principle consistent with natural justice that if some
persons are likely to be affected on account of setting
aside a decision enuring to their benefit, the Court should
not embark upon the consideration and the correctness
of such decision in the absen<;;e of such persons."
G
36. The proposition of law stated hereinabove has to be
understood in proper perspective. There were two prayers in
the writ petition. One was for payment of salary, the other was
for regularisation. Ultimately, the Division Bench absolved the
H
600 SUPREME COURT REPORTS [2015] 14 S.C.R.
A Union of India from liability of payment and fastened it on the
State. The State was not arrayed as a party to the lis. That
was an accepted fact. Needless to emphasise the State of
Assam was a necessary party and more so when the Union of
India was taking the stand that it was the State of Assam which
B had to bear the liability. The State of Assam was entitled to
resist the stand and stance put forth by the Union of India in
law.
37. In Public Service Commission, Uttranchal v.
Mamta Bisht and 0thers 34 it was held by a two-Judge Bench
C that the first respondent therein wanted her selection against
a reserved category vacancy and, therefore, the last selected
candidate in that category was a necessary party and without
impleading herthe writ petition could not have been entertained
by the High Court, for if a person challenges a selection
D process, successful candidates or at least some of them are
to be arrayed as parties they being necessary parties. To
appreciate the controversy, we must reproduce two
paragraphs from the said authority:-
"9. In case Respondent 1 wanted her selection against
E
the reserved category vacancy, the last selected
candidate in that category was a necessary party and
without impleading her, the writ petition could not have
been entertained by the High Court in view of the Jaw
laid down by nearly a Constitution Bench of this Court in
F
Udit Narain Singh Malpaharia v. Board of Revenue,
wherein the Court has explained the distinction between
necessary party, proper party and proforma party and
further held that if a person who is likely to suffer from the
order of the court and has not been impleaded as a party
G
has a right to ignore the said order as it has been passed
in violation of the principles of natural justice. More so,
proviso to Order 1, Rule 9 of the Code of Civil Procedure,
1908 (hereinafter called "CPC") provides that non-joinder
H "(201 O) 12 sec 204
POONAM v. STATE OF U.P. 601
[DIPAK MiSRA, J.]
of necessary party be fatal. Undoubtedly, provisions of A
CPC are not applicable in writ jurisdiction by virtue of
the provision of Section 141 CPC but the principles
enshrined therein are applicable. (Vide Gulabchand
Chhotalal Parikh v. State of Gujarat, Babubhai Muljibhai
Patel v. Nandlal Khodidas Barot 35 and Sarguja B
Transport Service v. STAT36 .)
1. O. In Prabodh Verma v. State of U.P. and Tridip Kumar
Dingal v. State of W.B., it has been held that if a person
challenges the selection process, successful candidates
or at least some of them are necessary parties." C
38. The said decision, as we understand, clearly spells
out that in the absence of a necessary party, no adjudication
can take place and, in fact, the non-joinder would be fatal to
the case. D
39. The aforesaid decisions do not lay down·as a
proposition of law that in every case when a termination is
challenged, the affected person has to be made a party. What
has been stated is when one challenges a provision as ultra
vi res the persons who are likely to be affected, some of them E
should be made parties in a representative capacity. That
has been the consistent view of this Court in service
jurisprudence. Some other decisions, which have been relied
upon are directly connected with regard to the selection and
selectees. On a perusal of the analysis made in J.S. Yadav F
(supra), we are disposed to think that the Court has applied
the principle pertaining to the constitutional validity by equating
it with the interpretation of a provision, whether it is
retrospective or prospective. That apart, the Court, as is
evident from paragraph 32 of the judgment, has noted that the G
prayer made by the appellant only related to the declaratory
relief. The said decision has to be understood in the context.
A ratio of a decision has to be understood in its own context,
"(1974) 2 sec 706
36(1987)1 SCC5 H
602 SUPREME COURT REPORTS [2015] 14 S.C.R.
A regard being had to the factual exposition. If there has been
advertence to precedents, the same has to be seen to
understand and appreciate the true ratio. The ratiocination in
the said decision is basically founded on the interpretation of
the statutory provision and the relief claimed. The Court has
B been guided by the fact that when the interpretation as regards
the provision whether it is retrospective or prospective, the
selected members are necessary parties.
40. In this regard, we may refer to the rule stated by Lord
Halsbury in Quinn v. Leathem 37 :-
C
"Every judgment must be read as applicable to the
particular facts proved or assumed to be proved, since
the generality of the expressions which may be found
there are not intended to be expositions of the whole law
D but govern and are qualified by the particular facts of the
case in which such expressions are to be found."
41. A three-Judge Bench in Union oflndia and others
v. Dhanwanti Devi and others 38 while discussing about the
precedent under Article 141 of the Constitution, held that:-
E "9. Before adverting to and considering whether solatium
and interest would be payable under the Act, at the outset,
we will dispose of the objection raised by Shri
Vaidyanathan that Hari Krishan Khosla case 39 is not a
binding precedent nor does it operate as ratio decidendi
F to be followed as a precedent and is per se per incuriam.
It is not everything said by a Judge while giving judgment
that constitutes a precedent. The only thing in a Judge's
decision binding a party is the principle upon which the
case is decided and for this reason it is important to
G analyse a decision and isolate from it the ratio decidendi.
According to the well-settled theory of precedents, every
decision contains three basic postulates-(i) findings of
37
(1901)AC 495, p. 506
"(1996) 6 sec 44
H " 1993 Supp (2) sec 149
POONAM v. STATE OF U.P. 603
[DIPAK MISRA, J.]
material facts, direct and inferential. An inferential finding A
of facts is the inference which the Judge draws from the
direct, or perceptible facts; (ii) statements of the
principles of law applicable to the legal problems
disclosed by the facts; and (iii) judgment based on the
combined effect of the above. A decision is only an B
authority for what it actually decides. What is of the
essence in a decision is its ratio and not every
observation found therein nor what logically follows from
the various observations made in the judgment. Every
judgment must be read as applicable to the particular c
facts proved, or assumed to be proved, since the
generality of the expressions which may be found there
is not intended to be exposition of the whole law, but
governed and qualified by the particular facts of the case
in which such expressions are to be found. It would, o
therefore, be not profitable to extract.a sentence here
and there from the judgment and to build upon it because
the essence of the decision is its ratio and not every
observation found therein. The enunciation of the reason
or principle on which· a question before a court has been E
decided is alone binding as a precedent. The concrete
decision alone is binding between the parties to it, but it
is the abstract ratio decidendi, ascertained on a
consideration of the judgment in relation to the subject-
matter of the decision, which alone has the force of law F
and which, when it is clear what it was, is binding. It is
only the principle laid down in the judgment that is binding
law under Article 141 of the Constitution. A deliberate
judicial decision arrived at after hearing an argument on
a question which arises in the case or is put in issue G
may constitute a precedent, no matter for what reason,
and the precedent by long recognition may mature into
rule of stare decisis. It is the rule deductible from the
application of law to the facts and circumstances of the
case which constitutes its ratio decidendi.
H
604 SUPREME COURT REPORTS [2015] 14S.C.R.
A 10. Therefore, in order to understand and appreciate the
binding force of a decision it is always necessary to see
what were the facts in the case in which the decision
was given and what was the point which had to be
decided. No judgment can be read as if it is a statute. A
B word or a clause or a sentence in the judgment cannot
be regarded as a full exposition of law. Law cannot afford
to be static and therefore, Judges are to employ an
intelligent technique in the use of precedents ...... "
42. From the aforesaid, it is clear as day that what has
C been stated in paragraph 31 in the case of J.S. Yadav (supra)
does not even follow from the authorities referred to therein.
We have analysed the principle of when and in what
circumstances, a decision becomes a binding precedent. We
have also discussed the facts at length keeping in view the
D declaratory relief made in the writ petition preferred before
the High Court: The context in which the observations have
been made have to be kept in mind. Regard being had to the
factual scenario in entirety and further taking note of the fact
that the court was basically concerned with the retrospective
E and prospective applicability of the provision, we are disposed
to think that it is not a binding precedent for the proposition
that in a case of termination or removal or dismissal, the person
appointed in the place of a terminated, removed or dismissed
employee would be a necessary party. That is how the said
F authority has to be understood, and we so understand.
43. It has been held in Debasis Das (supra), the
principles of natural justice are to be determined in the context
and it must depend to a great extent on the facts and
circumstances of that case. In this context, the decision in
G
Kai/ash. Chand Mahajan (supra) becomes extremely
apposite. May it be noted, we have already referred to the
said judgment but a detailed analysis is necessary to
understand the present controversy. In the said case, the first
respondent, after his retirement, was appointed as a Member
H
POONAM v. STATE OF U.P. 605
[DIPAK MISRA, J.]
of the Himachal Pradesh State Electricity Board and thereafter A
as the Chairman of the said Board. He was granted extensions
from time to time. The last extension was issued on June 12,
1989 for a period of three years i.e., July 25, 1992. After the
General Elections to the Legislative Assembly which was held
in January 1990, the Government issued a notification on March B
6, 1990 by which the earlier notification was superseded and
the appointment of the said respondent as Chairman was
extended from July 25, 1989 to March 6, 1990. Another
notification was issued on the same date directing that one
R.S. Chauhan shall function as the Chairman of the Board. c
The first respondent preferred a writ petition assailing the
validity of the notification by which his period was curtailed
and prayed for certiorari to quash the same. When the writ
petition was pending, a notification was issued terminating
the appointment of the writ petitioner. The High Court had o
passed a direction that no appointment to the post of Chairman
could be made till further orders of the Court. That order was
passed on 30'h March, 1990. At the time of conclusion of the
hearing, the learned Advocate General after obtaining
instructions filed an undertaking to the effect that the notification . E
dated March 6, 1990 curtailing the period of the writ petitioner
would be withdrawn. Accepting the undertaking, the writ
petition was disposed of. On June 11, 1990, the Government
withdrew both the notifications, i.e., March 6, 1990 and March
30, 1990. On June 11, 1990, a show cause notice was issued F
to Kailash Chand Mahajan and eventually he was suspended
and R.S. Chauhan, a Member of the Board was allowed to
function as the Chairman. The issuance of the show cause
notice and the order of suspension were challenged in a writ
petition. Various arguments were advanced from both sides G
and the High Court eventually quashed the notifications issued
by the State. Be it noted, a contention was raised before the
High Court that R.S. Chauhan having been appointed as the
Chairman, he ought to have been impleaded as a party which
was rejected by the High Court. This Court, dwelling upon H
606 SUPREME COURT REPORTS [2015] 14 S.C.R.
A various facets, posed the question whether the failure to
implead R.S. Chauhan would be fatal to the writ petition.
Addressing the said issue, as stated earlier, this Court
distinguished the decision of Miss Rafia Rahim (supra) and
Padamraj (supra) and thereafter proceeded to state thus:-
B "104. On the contrary, we think we should approach the
matter from this point of view, viz., to render an effective
decision whether the presence of Chauhan is necessary?
We will in this connection refer to A. Janardhana v. Union
of India it is held as under:
c
"Approaching the matter from this angle, it may be
noticed that relief is sought only against the Union of
India and the Ministry concerned and not against any
individual nor any seniority is claimed by anyone
individual against another particular individual and,
D
therefore, even if technically the direct recruits were
before the court, the petition is not likely to fail on that
ground."
105. What was the first respondent seeking in the writ
E petition? He was questioning the validitv of the Ordinance
and the Act whereby he had been deprived of his further
continuance. What is the relief could he have asked for
against Chauhan? None. The first point is Chauhan
came to be appointed consequent to the suspension of
F the first respondent which suspension had come to be
stayed by the High Courton June 12, 1990. Then, again,
as pointed out by the High Court it was "till further orders".
Therefore, we hold the failure to implead Chauhan does
not affect the maintainability of the writ petition."
G [Emphasis added]
The said decision, we are inclined to think is a binding
precedent for the purpose of understanding the concept of
necessary party. The Court has relied on the pronouncement
H in A. Janardhana (supra). What has been really laid down is
POONAM v. STATE OF U.P. 607
[DIPAK MISRA, J.]
that R.S. Chauhan was not entitled in law to contest the lis as A
Kailash Chand, the aggrieved party, was challenging the
ordinance as he had faced the curtailment of period of his
tenure.
44. In this context, we may refer to certain other authorities
where there has been an expansion of the concept of necessary B
party. The Constitution Bench in U.P. Awas Evam Vikas
Parishad vs. Gyan Devi (Dead) by LRs. & Ors. 40 has laid
down that in a land acquisition proceeding, the local authority
is a necessary party in the proceedings before the Reference
Court and is er:ititled to be impleaded as a party in those C
proceedings wherein it can defend the determination of the
amount of compensation by the Collector and oppose
enhancement of the said amount and also adduce evidence
in that regard. That apart, it has also been stated that in the
event of enhancement of the amount of compensation by the · D
Reference Court, if the Government does not file an appeal,
the local authority can file an appeal against the award in the
High Court after obtaining leave of the Court. That apart, the
Court also opined that in an appeal by the person having an
interest in the land seeking enhancement of the amount of E
compensation awarded by the Reference Court, the local
authorities should be impleaded as a party and is entitled to
be served notice of the said appeal and that could apply to
appeal in the High Court as well as in the Supreme Court.
45. In Delhi Development Authority vs. Bhola Nath F
Sharma (Dead) by LRs and Ors. 41 , the question arose
whether the Delhi DevelopmentAut.hority, at whose instance
land of the respondent and others had been acquired, could
. be treated as a 'person interested' within the meaning of
Section 3(b) of the Land Acquisition Act, 1894 and it was G
entitled to an opportunity to participate in the proceedings held
before the Land Acquisition Collector and the Reference Court
" (1995) 2 sec 326
• (2011) 2 sec 54
1
H
608 SUPREME COURT REPORTS [2015] 14 S.C.R.
A for determining the compensation. The two-Judge Bench
referred to U.P. Awas Evam Vikas Parishat (supra) and relied
upon a passage from SLP (C) No.1608 of 1999 42 and
eventually allowed the appeal and set aside the impugned
judgment of the High Court as well as that of the Reference
B Court and remitted the matter to the Reference Court to decide
the reference afresh after giving opportunity of hearing to the
parties which shall necessarily include opportunity to adduce
evidence for the purpose of determining the amount of
compensation.
C 46. We have referred to the aforesaid decisions with the
purpose that the company or the authority has been treated as
a necessary party on the foundation that it meets the criterion
provided in the definition clause and that apart ultimately it has
to pay the compensation. Therefore, it has a right in law to
D participate in the proceedings pertaining to determination of
the amount of compensation. Factual score, needless to say,
stands on a different footing.
4 7. Few examples can be given so that the position can
be easily appreciated. Tliere are provisions in some
E legislations pertaining to Gram Panchayat or Panchayat Samiti
where on certain grounds the competent authority has been
conferred the power to remove the elected Sarpanch or the
Chairman, as the case may be on certain counts. Against the
order of the Collector, an appeal lies and eventually either a
F revision or a writ lies to the High Court. After his removal,
someone by way of indirect election from amongst the
members of the Panchayats or the Panchayat Samiti is elected
as the Sarpanch or the Chairman. The removed Sarpanch
assails his order of removal as he is aggrieved by the manner,
G method and the reasons for removal. In his eventual success,
he has to hold the post of the Sarpanch, if the tenure is there.
:fhe question, thus, arises whether the person who has been
elected in the meantime from amongst the members of the
Panchayat Samiti or Sabha is a necessary party. The answer
H 42 Decided on 12.04.1999
POONAM v. STATE OF U.P. 609
[DIPAK MISRA, J.]
has to be a categorical 'no', for he cannot oppose the order of A
removal assailed by the affeCted Sarpanch nor can he defend
his election because he has come into being because of a
vacancy, arising due different situation.
48. In the instant case, shop no.2 had become vacant.
The appellant was allotted the shop, may be in the handicapped B
quota but such allotment is the resultant factor of the said shop
falling vacant. The original allottee, that is the respondent,
assailed his cancellation and ultimately succeeded in appeal.
We are not concerned with the fact that the appellant herein
was allowed to put her stand in the appeal. She was neither a C
necessary nor a proper party. The appellate authority permitted
her to participate but that neither changes the situation nor
does it confer any legal status on her. She would have
continued to hold the shop had the originc:il allottee lost the
appeal. She cannot assail the said order in a writ petition D
because she is riot a necessary party. It is the State or its
functionaries, who could have challenged the same in appeal.
They have maintained sphinx like silence in that regard. Be
that as it may, that would not confer any locus on the subsequent
allottee to challenge the order passed in favour of the former E
allottee. She is a third party to the /is in this context. The
.decisions which we have referred to hereinbefore directly
pertain to the concept of necessary party. The case of Kaitash
Chand Mahajan (supra) makes it absolutely clear. We have
explained tha authority in J.S. Yadav's case (supra) and F
opined that it has to rest on its own facts keeping in view the
declaratory relief made therein, and further what has been
stated therein cannot be regarded as a binding precedent for
the proposition that in a case of removal or dismissal or
termination, a subsequently appointed employee is a G
necessary party. The said principle shall apply on all fours to a
fair price shop owner whose licence is cancelled. We may
hasten to add, this concept will stand in contradistinction to a
case where the land after having vested under any statute in
the State have been distributed and possession handed over H
610 SUPREME COURT REPORTS [2015] 14 S.C.R.
A to different landless persons. It is because of such allotment
and delivery of possession in their favour, that is required under
the statute rights are created in favour of such allottees and,
therefore, they are necessary parties as has been held in Ram
Swarup & Ors. vs. S.N. Maira & Ors. 43 The subtle distinction
B has to be understood. It does not relate to a post or position
which one holds in a fortuitous circumstance. It has nothing to
do with a vacancy. The land of which possession is given and
the landless persons who have received the Pallas and have
remained in possession, they have a right to retain their
c possession. It will be an anarchical situation, if they are not
impleaded as parties, whereas in a case which relates to a
post or position or a vacancy, if he or she who holds the post
because of the vacancy having arisen is allowed to be treated
as a necessary party or allowed to assail the order, whereby
o the earlier post ho1der or allottee succeeds, it will only usher in
the reverse situation - an anarchy in law.
49. In this context, reference to the judgment in Ramesh
Hirachand Kundanmal vs. Municipal Corporation of
Greater Bombay & Ors. 44 would be fruitful. The two-Judge
E Bench was dealing with the concept of duminus litis which
relates to the plaintiff. The Court analysed the provision
contained in Order I Rule 10 and various sub-rules. The subject
matter in the case pertained to a dispute between the petitioner
and the respondent no.1 which centered on the demolition and
F unauthorized construction bytlie competent authority under the
Bombay Municipal Act. The respondent no.2 was the lessee
in possession of the service station. The Municipal
Corporation had not issued any notice to the said respondent.
It was contended before the Court that the respondent no.2
G was instrumental in the initiation of the proceeding by the
Municipal Corporation against him. The court addressed to
the issue whether the said respondent is a necessary or proper
party. In the said case, the appellant had instituted a case
H "(1999) 1sec738
"(1992) 2 sec 524
POONAM v. STATE OF U. P. 611
[DIPAK MISRA, J.]
against the third respondent for declaration that she was the A
lawfully married wife of the third respondent who had entered
context and admitted the claim. An application for
impleadment was sought by the respondent nos.1 and 2 on
the ground that they were respectively the wife and son ofthe
third respondent and they were interested in denying the B
appellant's status as wife and the children as the legitimate
children of the third respondent. The trial court had allowed
the application and the said order was confirmed by the High
Court in its revisional jurisdiction. This Court referred to the
authority in Razia Begum vs. Anwar Begum 45 and came to c
hold that there is a clear distinction between the suits relating
to property and those suits in which the subject matter of
litigation is a declaration as regards status or legal character.
The Court observed that in the former category, the rule of
personal interest is distinguished from the commercial interest o
which is required to be shown before a person may be added
as a party and accordingly held :-
"The only reason which makes it necessary to make a
person a party to an action is so that he should be bound
by the result of the action and the question to be settled, E
therefore, must be a question in the action which cannot
be effectually and completely settled unless he is a party.
The line has been drawn on a wider construction of the
rule between the direct interest or the legal interest and
commercial interest. It is, therefore, necessary that the F
person must be directly or legally interested in the action
in the answer, i.e., he can say that the litigation may lead
to a result which will affect h!m legally that is by curtailing
his legal rights."
And again:- G .
"It is difficult to say that the rule contemplates joining as a
defendant a person whose only object is to prosecute
his own cause of action. Similar provision was
45
AIR 1958 SC 886 H
612 SUPREME COURT REPORTS (2015] 14 S.C.R.
A considered in Amon v. Raphael Tuck & Sons Ltd. 46 ,
wherein after quoting the observations of Wynn-Parry, J.
in Dollfus Mieg et Compagnie S.A. v. Bank of
England47 , that their true test lies not so much in an
analysis of what are the constituents of the applicants'
B rights, but rather in what would be the result on the subject
matter of the action if those rights could be established,
Devlin, J. has stated:
"The test is 'May the order for which the plaintiff is
asking directly affect the intervener in the enjoyment
C of his legal rights'."
Eventually, the Court unsettled the order passed by the
trial court as well as by the High Court.
50. We have referred to the said decision in extenso as
D there is emphasis on curtailment of legal right. The question
to be posed is whether there is curtailment or extinction of a
legal right of the appellant. The writ petitioner before the High
Court was trying to establish her right in an independent
manner, that is, she has an independent legal right. It is
E extremely difficult to hold that she has an independent legal
right. It was the first allottee who could have continued in law,
if his licence would not have been cancelled. He was entitled
in law to prosecute his cause of action and restore his legal
right. Restoration of the legal right is pivotal and the prime
F mover. The eclipse being over, he has to come back to the
same position. His right gets revived and that revival of the
right cannot be dented by the third party.
51. In viewofthe"aforesaid premises, we do not perceive
any merit in this appeal and, accordingly, the same stands
G dismissed. There shall be no order as to costs.
Bibhuti Bhushan Bose Appeal dismissed.
46 (1954) 1 All ER 273
47 (1950) 2 All ER 605, 611
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