TMI Blog2004 (3) TMI 749X X X X Extracts X X X X X X X X Extracts X X X X ..... ity and the Certificates of Recovery. 3. The Delhi High Court has, in the Judgment impugned in Civil Appeal Nos. 4014-4017 of 1998 and 4018-4021 of 1998, held that the appointment of the Managing Director was against the principle that 'no man can be a judge in his own cause' and struck down the appointment of the Managing Director and accordingly struck down the Certificate of Recovery. On the other hand, the Punjab and Haryana High Court has in the Judgment, impugned in Civil Appeal No. 7818 of 2002, disagreed with the view of the Delhi. High Court and has upheld the appointment of the Managing Director. However, on facts of that case, it was held that the opportunity of being heard had not been granted and the matter was referred back for giving a hearing to the party and passing a fresh order. The Financial Corporations being aggrieved by the Judgment of the Delhi High Court have come in Appeal against that Judgment. The party being aggrieved by the Judgment of the Punjab Haryana High Court has come in Appeal against that Judgment. 4. At this stage it must be mentioned that even though the Delhi High Court allowed the Writ Petitions on the above mentioned ground ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er Section 32G of the Act. The Delhi High Court has held that the question was not whether the Managing Director would be biased or not. It is held that the real question was whether his appointment as an authority under Section 32G would inspire confidence of the entrepreneur or not. The Delhi High Court has held that his appointment would not inspire confidence as the question was not of the bias but of the reasonable likelihood of bias. The Delhi High Court has held that it is against all canons of justice to make a man a judge in his own cause. It is held that justice should not only be done but should be seen to be done as well. 7. The Punjab and Haryana High Court has disagreed with this view. It has held that the decision of the Delhi High Court appears to be based on the assumption that the function of the authority was akin to the determination of a lis/dispute between the parties. The Punjab and Haryana High Court has held that the procedure laid down for issuance of Recovery Certificates does not involve adjudication of a lis in a strict sense. It has held that the only thing which the State Government or the specified authority is to do before issuing a Certificate i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d objections; made notes and presumably discussed the matter with the Chief Minister before the latter approved the scheme. It was noted that even though formal orders were passed by the Chief Minister, the inquiry was conducted and personal hearing was given by one of the parties to the dispute itself. On these facts, it was held that persons who are entrusted with the duty of hearing a case judicially should be one who have no personal bias in the matter. On these facts, the majority of the Judges applied the principle that 'no man can be a judge on his own cause' and struck down the scheme. However Justice Wanchoo and Justice B.P. Singh held that the action of the Government was purely administrative and that in such cases it does not follow that the Secretary was an improper person, to hear the objections. 9. This question again came up for consideration before a Constitution Bench of this Court in the case of Lachhman Das on behalf of Firm Tilak Ram Bux v. State of Punjab and Ors. . The facts of this case are almost identical to the facts of the present case. In Lachhman Das's case (supra) the statute provided a special procedure of recovery. Under the provision ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... point the further observations made may also be reproduced as they have a bearing on other points urged before us: - It is then said that the hearing before the Managing Director is perfunctory, that under Rule 6, he is only to examine the objections stated in the written statement in the light of the relevant records of the department and decide the dispute, and that there is thus no real opportunity afforded to the parties to present their case. This argument proceeds on a misconception of the true scope of Rule 6. It does not bar the parties from examining witnesses or producing other documentary evidence. The Managing Director, has, under this Rule, to examine the statement and the records of the Bank, in so far as they bear on the points in dispute and that normally, would be all that is relevant. But he is not precluded by the Rule from examining witnesses or taking into account other documentary evidence, if he consider that that is necessary for a proper determination of the dispute. And whether he should do so or not is a matter left to his discretion. Discussing a somewhat similar question arising on the language of Section 68-D(2) of the Motor Vehicles Act, 1939, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... stage it must also be mentioned that the control of the State Financial Corporation Act, by virtue of Section 9, vests in a Board of Directors. Of course the Board of Directors would take the assistance of the Executive Committee and the Managing Director. But the control remains that of the Board of Directors and therefore there is no question of presuming that there was any conflict of duty or that the Managing Director would not act fairly. 12. Reliance was also placed upon the decision of another Constitution Bench of this Court in the case of A.K. Kraipak and Ors. v. Union of India and Ors. . In this case the Acting Inspector General of Forest of Jammu Kashmir State was himself a candidate for selection to the Indian Forest Service. Even though he was a candidate he became a Member of the Selection Board constituted under Regulation 5 for preparing a list of officers of State Forest Service. In the list which was prepared his name was shown as No. 1. It was pointed out that the Acting Inspector General of Forest did not sit in the Selection Board at the time when his name was considered by the Selection Board. This Court held even though he may not have sat in the Select ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... espondent Bank as an Estate Officer under the Public Premises (Eviction of Unauthorised Occupants) Act, 1971, was challenged on the ground that it was violative of Article 14 of the Constitution of India. This Court held that in the very nature of things, only an officer or an appointee of the Government, statutory authority or Corporation can be thought of for implementing the provisions of the Act. This Court held that personal bias cannot be attributed to such officers either in favour of the bank or against any occupant who is being proceeded against, merely because he happens to be an officer. Thus, the authorities disclose that mere appointment of an officer of the Corporation does not by itself bring into play the doctrine that 'no man can be a judge in his own cause'. For that doctrine to come into play it must be shown that the concerned officer has a personal bias or a personal interest or has personally acted in the concerned matter and/or has already taken a decision one way or the other which may be interested in supporting. This being the law it will have to be held that the decision of the Delhi High Court is erroneous and cannot be sustained and the view tak ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rated by the same Amending Act which incorporated provisions for enforcement against a. surety. The fact that it is incorporated at the time when provisions permitting proceedings against a surety are being incorporated indicates that the Legislature was aware that proceedings under Section 32G could apply even against a surety. If at this time the Legislature intended that Section 32G was not to apply to a surety then the Legislature would have specifically so provided. It is therefore clear that the remedy under Section 32G is available even against a surety. 17. In support of the submission that the Legislature did not intend to apply Section 32G to a surety, reliance was placed upon the case of P.K. Unni v. Nirmala Industries and Ors. wherein it has been held that the Court must proceed on the assumption that the Legislature did not make a mistake and that it intended to say what it said. It was held that assuming there is a defect or an omission in the words used by the Legislature, the Court cannot correct or make up the deficiency. It was held that the Court cannot add words to a Statute or read words into it which are not there, especially when a literal reading thereof ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he applicant had sufficient cause for not making the application within the said period. (2) Where any workman is entitled to receive from the employer any money or any benefit which is capable of being computed in terms of money and if any question arises as to the amount of money due or as to the amount at which such benefit should be computed, then the question may, subject to any rules that may be made under this Act, be decided by such Labour Curt as may be specified in this behalf by the appropriate Government [within a period not exceeding three months]. 20. It was submitted that the wordings of Section 33C(1) and 32G are identical. Reliance was then placed upon the authority of this Court in the case of Fabril Gasosa v. Labour Commissioner and Ors. wherein Section 33C was considered. It was held that Section 33C is in the nature of an execution proceeding designed to recover the dues of the workmen. The distinction between Sub-sections (1) and (2) was noticed and it was held that this distinction is mainly in the procedural aspect and not with any substantive rights of workmen. It was held that after the determination is made by the labour court under Sub-section (2) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t is contemplated is a mere mathematical calculation after looking into the papers. The borrower and the surety or the guarantor know what are the amounts due, they know what amounts have been repaid, they know when the amounts were to be repaid, what has not been repaid or how belatedly amounts have been repaid. They knew what the rate of interest is. Thus a mere calculation has to be made to ascertain the amount due. If on such calculations it is found that an amount due is due to the Financial Corporation then a Certificate of Recovery can be issued. Undoubtedly, the provision is the nature of an execution proceeding but it is not a recovery proceeding pursuant to a decree of a Court. It is a recovery proceeding on the amount being found to be due by a simple verification by the State Government or the authority appointed by it. Further to accept the interpretation suggested by counsel would be to go against the very purpose and object of the Act which is to ensure speedy recovery. With that object in that Sections 29, 31 and 32 have been enacted. These have been found to be inadequate. Thus by Section 32G one more remedy of recovery is given to a Financial Corporation. Merely f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... required of the Financial Corporation cannot be carried to the extent of disabling them from recovering what is due to them. Thus a provision incorporated by the Legislature with intention to enable Financial Corporations to speedily recover amounts due to them cannot be whittled down by giving an interpretation which would render it nugatory. 23. It was next submitted that under Sections 31 and 32 an elaborate procedure has been established. It was submitted that unlike that Section 32G does not lay down any procedure. It was submitted that this Court must thus strike down Section 32G as being arbitrary. It was submitted that such a draconian provision can be exercised without giving any reasons in writing and in the absence of any procedure. It was submitted that absence of procedure means that the principles of natural justice need not be followed. It was submitted that no right of Appeal has been provided against the issuance of a Certificate of Recovery issued under Section 32G. In support of the submission that such a provision must be struck down, reliance was placed upon the case of Excel Wear etc. v. Union of India and Ors. wherein Sections 25(O) and Section 25(R) of t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er remedy was available, resort should not be had to the dilatory procedure of the ordinary civil court. It was held that such a Section is not discriminatory and is not violative of Article 14 of the Constitution. 25. There is no provision barring jurisdiction of Civil Courts. Thus a suit can be filed or resort can always be had to the High Court under Article 226 or Article 227 of the Constitution of India. Section 32G provides that the State Government or the authority will issue a certificate after following the procedure. The words 'after following the procedure' necessarily indicates that principles of natural justice have to be complied with. Thus, notice would have to be issued, the party concerned would have to be heard and then only the order would be passed. We see no substance in the submission that the order must always be a speaking order or a reasoned order. Considering the fact that the provisions only contemplate arithmetical calculations or simple verification, the question of any reasoned or speaking order does not arise. All that is to be stated is that the amount is found due. On that basis the Certificate of Recovery is to be issued. We, therefore, ..... X X X X Extracts X X X X X X X X Extracts X X X X
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