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TMI Blog2024 (7) TMI 1407X X X X Extracts X X X X X X X X Extracts X X X X ..... Sri Madhukar Deshpande, learned Central Government Counsel appearing for respondents 1 and 2 and Sri B.N. Jagadeesh, learned Additional State Public Prosecutor appearing for respondents 3 and 4. 3. Facts, in brief, germane are as follows:- One Ullas Karanth said to be the * son of Dr. K. Shivarama Karanth, is the Chief Functionary for Centre for Wild Life Studies. The petitioner registers a trust deed under the name and style of Centre for Wildlife Studies with the object of promoting and carrying on activities relating to scientific study *Deleted vide chamber order dated 27.06.2024. and conservation of natural habitats of wildlife, promoting projects which involve rehabilitation of endangered animals, ecosystem and plants. The members of the scientists in the Trust are internationally recognized and have been conferred several awards and innumerable encomiums. With the aforesaid objects, on 23-01-1990 the Trust registers itself under the Act. The registration has been renewed from time to time. On 05-03-2021, the petitioner makes an application for change of bank account in which funds of the trust were being operated, which also came to be permitted. After the said act, th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s reasonable opportunity of being heard. Being heard would not mean personal hearing. It is his submission that the requirement is only issuance of a show cause notice and not personal hearing. The show cause notice had admittedly been issued in the case at hand. Therefore, the impugned order cannot be interfered with on the said ground. 6. I have given my anxious consideration to the submissions made by the respective learned counsel and have perused the material on record. 7. The afore-narrated facts are not in dispute. The registration of the petitioner on 23-01-1990 is a matter of record. On an allegation that there has been mis-management of funds of foreign contributors, an order of suspension of registration of the petitioner comes about on 05-03-3021 for a period of six months. After the suspension, it is said that a communication is sent to the petitioner for which the respondents do not have any proof and the contention is that it was never received by the petitioner. Therefore, I leave the submission thereto as it is. The petitioner then, to the order of suspension, is seen to have sent a reply on 11-04-2023. This results in a show cause notice being issued to the peti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n any reasonable activity in its chosen field for the benefit of the society for two consecutive years or has become defunct. (2) No order of cancellation of certificate under this section shall be made unless the person concerned has been given a reasonable opportunity of being heard. (3) Any person whose certificate has been cancelled under this section shall not be eligible for registration or grant of prior permission for a period of three years from the date of cancellation of such certificate." (Emphasis supplied) Section 14 of the Act permits cancellation of registration made under Section 12 of the Act, if the Government is satisfied, after making such inquiry as it may deem fit, to cancel the certificate. Sub-section (2) of Section 14 of the Act mandates that no order of cancellation under the Section shall be made unless the person concerned is given a reasonable opportunity of being heard. Sub-section (3) mandates that any person whose certificate has been cancelled shall not be eligible for registration or grant for a period of three years from the date of such cancellation. 9. A perusal at Section 14 of the Act would indicate two significant mandates i.e., ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ations are not correct is set out at pages 553 to 558. (v) Pajero Car was received by the petitioner in the year 1998, which vehicle was used extensively for forest activities for nearly 10 years, after which, it became unfit for further activities of the Trust and therefore, a decision was taken to sell it. Permission was also sought for from the Customs Department and the Customs Department granted permission to sell the Car and consequently, the Car was sold for the value set out in the books of the petitioner. (Pages 559 to 570) (vi) Though the donation was received for the project "WILD KAAPI", there were no takers and ultimately, the Managing Trustees incorporated the partnership firm under the name and style "WILD KAAPI LLP". Not a single rupee of foreign contribution was transferred to "WILD KAAPI LLP". What comes about is one of the impugned orders dated 04-09-2023. A perusal at the impugned order would not indicate that it is so cryptic that it needs to be annulled. But, the issue is not with regard to it being cryptic. The issue is, whether the petitioner should have been afforded a personal hearing in terms of sub-section (2) of Section 14 of the Act prior to pa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... days, the applications for the grant of mining lease shall, if the area was previously held and worked under a mining lease, be disposed of before the application for the grant of prospecting licence are considered: PROVIDED FURTHER that the applications received for grant of prospecting licence shall be liable to be considered only if they have not been already disposed of." (underline supplied) 6. The Rule Making Authority has chosen to specifically provide that the power of rejection or refusal can be exercised by the State Government after giving an opportunity of being heard. We cannot accept the narrow interpretation put by the second respondent that 'opportunity of being heard' may not be necessarily 'opportunity of being personally heard'. 7. The words 'after giving an opportunity of being heard' were inserted by the amendment dated 2nd May 1979. Earlier sub-rule (1) of Rule 12 simply provided that the State Government may, for reasons to be recorded in writing and communicated to the applicant, refuse to grant or renew prospecting licence. Therefore, the Rule Making Authority has added the aforesaid words which clearly imply that the intention was to provide an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... bjections. ................ If the right to be heard is to be a real right and is worth anything it must carry with it a right in the person to know the case which is made against him. He must know what materials have been collected, what evidence has been given and what statements or reports have been made affecting his rights. He must be given a fair opportunity for correcting or contradicting any relevant statement pre-judicial to his view. These principles appear in all these cases right from the celebrated judgment of Lord Loreburn, L.C. in Board of Education v. Rice (1911 A.C. 179)" 20. This crucial aspect appears to have escaped the notice of the disciplinary authority. The show cause notice issued by the disciplinary authority against the proposed penalty asked the respondent to file only the representation. The respondent has not been afforded an opportunity of being heard. When the Rules governing the conducting of enquiry specifically provide that a hearing shall be given to the delinquent employee, he ought to be given a fair hearing and failure to give such a hearing would vitiate the order of penalty. The order against the respondent, therefore, cannot be sustained ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dated 29, September 2016 which is reproduced by the Union of India in his affidavit and which reads as hereunder "as per inputs with financial assistance of ACTIOONAID, UK, NGOs like Society for Advocacy and Development (SAMVAD) and Jai Bharti Shiksha Kendra, Katni M.P. Chalked out a plan on November 11, 2011 to increase public awareness against the proposed Chutka Nuclear Power Plant and Ataria Dam Project. In this connection, an agreement was made between British based financial agency ACTION AID and SAMVAD, including Jai Bharti Shiksha Kendra, in the month of January, 2012, under Network co-ordination Project for a period of 10 years to mobilize the public against the Chutka Projects including the Ataria Dam Project, ACTIONAID, UK sanctioned an amount of Rs. 10 Lakh to SAMVAD for the year 2012 for carrying out the campaign." The affidavit while not denying the fact that no opportunity was given to the petitioner of being heard before the impugned order was passed cancelling his registration states in paragraph-6 that principles of natural justice has not been violated as the action has been taken strictly as per the FCRA, 2010. 6. Heard the learned counsel for the parties an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ive principles" which the statutory authorities have to follow while exercising the discretion vested in them. This principle has been extended even when the authorities have to exercise administrative discretions under certain situations. Another well-settled principle which has emerged during the years that where a statute vests discretion in the authority to exercise a particular power, there is an implicit requirement that it shall be exercised in a reasonable and rational manner free from whims, vagaries and arbitrariness. 5. The High Court has primarily considered the question as to whether denying an opportunity to the appellant to be heard before his prayer to dispense with the deposit of the penalty is rejected, violates and contravenes the principles of natural justice. In that connection, several judgments of this Court have been referred to. It need not be pointed out that under different situations and conditions the requirement of compliance of the principle of natural justice vary. The courts cannot insist that under all circumstances and under different statutory provisions personal hearings have to be afforded to the persons concerned. If this principle of affor ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... deposit of such amount itself is an exception which has been incorporated in different statutes including the one with which we are concerned. Second proviso to sub-section (1) of Section 4-M says in clear and unambiguous words that an appeal against an order imposing a penalty shall not be entertained unless the amount of the penalty has been deposited by the appellant. Thereafter the third proviso vests a discretion in such appellate authority to dispense with such deposit unconditionally or subject to such conditions as it may impose in its discretion taking into consideration the undue hardship which it is likely to cause to the appellant. As such it can be said that the statutory requirement is that before an appeal is entertained, the amount of penalty has to be deposited by the appellant; an order dispensing with such deposit shall amount to an exception to the said requirement of deposit. In this background, it is difficult to hold that if the appellate authority has rejected the prayer of the appellant to dispense with the deposit unconditionally or has dispensed with such deposit subject to some conditions without hearing the appellant, on perusal of the petition filed on ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... not issued any instructions or directions under Section 11, which requires that the rules of natural justice be complied with. Thirdly, it cannot be said that the appellants had been condemned unheard as the entire material on which the appellants were relying was placed before SEBI. It is upon consideration of the entire matter that the offer of the appellants was rejected. This is evident from the detailed order passed by SEBI on 30-4-2007. The letter indicates precisely the exceptional circumstances mentioned by the appellants seeking to withdraw the public announcement. Each and every circumstance mentioned was considered by SEBI. Therefore, it cannot be said that the appellants have been in any manner prejudiced by the non-grant of the opportunity of personal hearing. Therefore, the submission made by Mr Shyam Divan with regard to the breach of rules of natural justice is rejected." (Emphasis supplied) The finding of the Apex Court is that SEBI has not issued any instruction or direction under Section 11 of the Act therein, which requires that Rules of natural justice be complied with. Therefore, non-grant of opportunity of personal hearing has not caused any prejudice to ..... X X X X Extracts X X X X X X X X Extracts X X X X
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