Common
Cause A Regd. Society Vs. Union of India
& Ors [1996] INSC 1387 (4 November 1996)
Kuldip
Singh, Faizan Uddin
ACT:
HEAD NOTE:
O R D
E R
Union of India and Ors. Writ Petition (C) No. 26/95 was whether the
allotments of retail outlets for petroleum products (Petrol Pumps) were illegal
and as such liable to the quashed. This Court by the judgment dated September 25, 1996 came to the conclusion that the
allotments made by Capt. Satish Sharma were arbitrary, discriminatory, mala
fide, wholly illegal and as such were liable to be quashed.
This
Court reached the said findings on the following reasoning :
"All
the 15 allotments - discussed above - have been made by the Minister in a
stereotyped manner.
The
Petroleum Ministry. There is no receipt - entry on any of the applications. The
applicants seem to have approached dealt with in any of the branches of the
Ministry. There is nothing on the record to indicate that the Minister kept any
criteria in view while making the allotments. How the applicants came to know
about the availability of the petrol pumps is not known. No advertisement was
made to invite the applications. There is nothing on the record to show that
any other method of the inviting applications was adopted. There is no
indication in the allotment- orders or any where in the record to show that the
Minister kept any guidelines in view while making these allotments. The
allotments have been made in a cloistered manner. The petrol pumps - public
property - have been doled out in a wholly arbitrary manner." .....
"All
these allotments are wholly arbitrary nepotistic and are motivated by
extraneous consideration."
"We
have no hesitation in holding that Capt. Satish Sharma in his capacity as a
Minister for Petroleum and Natural Gas deliberately acted in a wholly arbitrary
and unjust manner. We have no doubt in our mind that Capt. Satish Sharma knew
that the allottees were relations of his personal staff, sons of Ministers,
Selection Boards and the members of the Oil Selection Boards themselves. The
allotments made by him were wholly mala fide and as such cannot be sustained.
We are
further of the view that Capt. Satish Sharma acted in a wholly biased manner
inasmuch as he unfairly regarded with favour the cases of 15 allottee before
him.
The relevant
circumstances available from record and discussed by us leave no manner of
doubt in our mind that Capt. Satish Sharma deliberately acted in a biased
manner to favour these allottees and as such the allotment orders are wholly
vitiated and are liable to be set aside." "Mr. Satish Sharma has
acted in utter violation of the law laid- down by this Court and has also infarcted
Article 14 of the Constitution of India. As already stated in a minister in the
Central Government is in a position of a trustee in respect of the public
property under his agencies are a kind of wealth which the Government must
distribute in a bona fide manner and in conformity with law. Capt. Satish
Sharma has betrayed the trust reposed in him by the people under the
Constitution." One of the directions issued by this Court was an under :
"5.
Capt. Satish Sharma shall show- cause within two weeks why a direction be not
issued to the appropriate police authority to register a case and initiate
prosecution against him for criminal breach of trust or any other offence under
law. He shall further show-cause within the said period why he should not, in
addition, be made liable to pay damages for his mala fide action in allotting
petrol pumps to the above mentioned fifteen persons." Pursuant to the
above quoted direction, a show cause notice was issued to Capt. Satish Sharma.
He has filed affidavit in reply to the show cause notice.
We
have heard Mr. Salve, learned counsel appearing for Capt. Satish Sharma. There
are two parts of the directions quoted above. This Court has called upon Capt. Satish
Sharma to show cause why a direction be not issued to the appropriate police
authority to register a case and initiate prosecution against him for criminal
breach of trust or any other offence under law.
The
findings of this Court, quoted above, and the conclusion reached in the Common
Cause case, leave no manner of doubt that an investigation by an independent
authority is called for in this case. We, therefore, direct the Central Bureau
of Investigation (CBI) to register a case against Capt. Satish Sharma in
respect of the allegation dealt with and the findings reached by this Court in
the Common Cause case. The CBI shall hold investigation and proceed in
accordance with law. There shall be no limit on the power, scope and sphere of
investigation by the CBI.
We,
however, make it clear that the CBI shall not be influenced by any observations
made by this Court or the findings reached in Common Cause case, for reaching
the conclusion as to whether any prima facie case for prosecution/trial is made
out against Capt. Sharma. It shall have to be decided on the basis of the
material collected and made available with the CBI as a result of the
investigation. We direct the CBI to complete the investigation within three
months of the receipt of this order. The CBI shall file interim report to
indicate the compliance of this order. This shall be to indicate the compliance
of this order. This shall be done by January 20, 1997 and this matter shall be
listed on January 22, 1997 before a Bench of which Mr. Justice Faizan Uddin is
a member.
Mr. Harish
Salve has addressed elaborate arguments on the question of damages. We place on
record our appreciation for Mr. Harish Salve for assisting this Court in a very
fair and independent manner.
According
to Mr. Salve this is not a case where compensatory or exemplary damages should
be imposed.
According
to him nominal damages would meet the ends of justice.
This
Court has authoritatively laid down in Nilabati Ors. 1993 (2) SCC 746 that
damages can be awarded by this Court in proceedings under Article 32 of the
Constitution of India. Mr. Salve has taken us through the Privy Council 1129.
Lord Devlin in his opinion has held that exemplary damages can be awarded for
"oppressive, arbitrary and unconstitutional action by the servants of the
Government".
Mr.
Salve has also taken us through the judgment of the Services Ltd. 1993 Queen's
Bench 507. Broome's case elaborately discussed and relied upon in this
judgment. It would be useful to quote the relevant part of the opinion by
Stuart-Smith L.J.
"This
first category is "oppressive, arbitrary or unconstitutional action by the
servants of the government." It is common ground that this category of
persons is not limited to the servants of central government, but includes
servants of local government and the police.
In
Broome v. Cassell & Co. Ltd. (1972) A.C. 1027, 1077- 1078, Lord Hailsham of
St. Marylebone L.C. said :
"...
I would be surprised if it included only servants of the Government if the
strict sense of the word. It would, in my view, obviously apply to the police
... and almost as certainly to local and other officials exercising improperly
rights of search or arrest without warrant, and it may be that in the future it
will be held to include other abuses of power without warrant by persons
purporting to exercise legal authority." Lord Reid said, at pp. 1087-88 :
"With
regard to the first I think that the context shows that the category was never
intended to be limited to Crown servants. the contrast is between "the
Government" and private individuals. Local government is as much
government as national government, and the police and many other persons are
exercising governmental functions. It was unnecessary in Rookes v. Barnard to
define the exact limits of the category. I should certainly read it as
extending to all those who by common law or statute are exercising functions of
a governmental character." Lord Wilberforce said at p.1120 :
"There
is not perhaps much difficulty about category 1 : it is well based on the cases
and on a principle stated in 1703 - 'if public officers will infringe men's
rights, they ought to pay greater damages than other men to deter and hinder
others from the like offences:' Ashby v. White (1703) 2 Id. Raym. 938, 956, per
Holt C.J. Excessive and insolent use of power is certainly something against
which citizens require as much which I understand your Lordships to endorse
would correspond with Holt C.J.'s 'public officers' and would partly correspond
with modern needs." Lord Diplock said of the first category, at p.1130 :
"It
would embrace all persons purporting to exercise powers of government, central
or local, conferred upon them by statute or at common law by virtue of the
official status or employment which they held." In the said case Thomas
Bingham M.R. further elaborated the concept in the following words :
"In
the first category there had been what he variously described as an
"arbitrary and outrageous use of executive power:' (see p. 1223) and
" oppressive, arbitrary or unconstitutional action by the servants of the
government:" see p. 1226. Minute textual analysis of these expressions is
inappropriate.
This
was a judgment, not a statute.
But
there can be no doubt What Lord Devlin was speaking about. It was gross misuse
of power,involving tortious conduct, by agents of government. According to the
traditional classification of the law of tort, such misuse of power could give
rise to any one of a number of causes of action, which Lord Devlin was not at
pains to identify." The Court of Appeal also relied upon the judgment of
Appeal Cases 1027.
We are
of view that the legal position that exemplary damages can be awarded in a case
where the action of a public servant is oppressive, arbitrary or
unconstitutional is unexceptionable. The question for consideration, however,
is whether the action of Capt. Satish Sharma makes him liable to pay exemplary
damages. In view of the findings of this Court in Common Cause Case - quoted
above - the answer has to be in the affirmative. Satish Sharma's actions were
wholly arbitrary, mala fide and unconstitutional. This Court has given clear
findings to this effect in the Common Cause case. We, therefore, hold that
Capt. Satish Sharma is liable to pay exemplary damages.
We
have heard Mr. HN Salve on the question of quantum.
Mr.
Salve has vehemently contended that Capt. Sharma was a part of the system which
was operating before his joining as a Minister. According to him the types of
wrongs were being committed even earlier on the assumption subjective
satisfaction. He has further contended that since the concept of absolute
liability of public servants for misfeasance has been of recent origin in this
country even while awarding exemplary damages leniency should be shown.
There
is some plausibility in the contentions raised by Mr. Salve. After examining
all the facts and circumstances of this case and giving thoughtful
consideration to this aspect, we direct Capt. Satish Sharma to pay a sum of Rs.50
lac as exemplary damages to the Government Exchequer.
Since
the property with which Capt. Sharma was dealing was public property, the
Government which is "by the people" has to be compensated. We further
direct Capt. Sharma to deposit the amount with the Secretary, Ministry of
Finance, Government of India within nine months from today. The amount if not
paid, shall be recoverable as arrears of land revenue.
Back
Pages: 1 2