Shivsagar
Tiwari Vs. Union of India & Ors [1996] INSC 1302
(11 October 1996)
Kuldip
Singh, B.L. Hansaria Hansaria.J.
ACT:
HEAD NOTE:
Edmund
Burke stated as early as 1777: "Among a people generally corrupt, liberty
cannot long exist." In 1778, he observed: "An arbitrary system indeed
must always be a corrupt one. There never was a man who thought he had no law
but his own will, who did not soon find that he had no end but his own
profit."
2.
According to Francis Beanmount (1584-1616) corruption is a tree, whose branches
are of an un measurable length, they spread everywhere, and the dew that drops
from thence, hath infected some chairs and stools of authority.
3. In
the Encyclopaedia of Democracy by Seymour Martin Lipset, Vol.1, page 310, in
the Chapter "Corruption", it is stated that corruption is an abuse of
public resources for private gain. It is known that bribes open the way for
access to the State for those who are willing to pay and can afford to pay. The
situation leaves non-corrupt citizen with the belief that one counts only if
one has the right personal contact with those who hold power and also allow
persons with money power to get things done to their advantage through back
door.
4. In
the present case, as we are concerned with alleged motivated, arbitrary and
high-handed actions of a Minister, it would be worth-while to point out what
role has been assigned in a parliamentary democracy to a Minister.
The
head of the State (President or Governor in our country, as the case may be,)
calls upon the leader of the political party that commands majority to form
government and appoints him as Prime/Chief Minister; and on later's advice
appoints other Ministers. Business of the Government, gets allocated and is run
as per business rules framed, which in our Constitution has been dealt by
Article 166(3). The executive power of the Government is distributed department
wise and one Government is distributed department wise and one Minister is made
the head of that department. That Minister becomes responsible for the actions,
acts and policies of his department. He becomes principally accountable and
answerable to the people. His powers and duties are regulated by the law of the
land. The legal and moral responsibility or liability for the acts or omissions
rest solely on the Minister.
5.
Having noted the philosophy, sociology and etymology of corruption, as well as
the essence of a parliamentary democracy, let it broadly be seen what had
happened in the present case. For this purpose it would be enough to note some
of the prima facie conclusions arrived at by the Central Bureau of
Investigation (CBI) who was required by this Court to inquire into the matter
(which has come to be known as Housing Scam) by order dated 14.2.1996.
6. The
CBI has since inquired into the master in some detail and has by now submitted
4 Interim the CBI, orders of allotment in respect of the shops/stalls in
question were passed by Smt. Shiela Kaul, the then Minister of Urban
Development, and "all the 6 shops have been allotted by her to her own
relation/employees/domestic servants of her family members and family friends.
She has allotted 2 shops to her 2 grandsons, one shop to the maidservant of her
son, Sh. Vikram Kaul who is residing in Dubai, one ship to handloom manager of the firm owned by her son-in-law and
another shop to a close friend. One shop has been allotted to the nephew of the
Minister of State, Sh. P.K. Thungon.
While
making allotments in respect of stalls, she has allotted most of stalls to the
relations/friends of her personal staff and officials of Dte. of Estates."
The CBI has also reported that Smt. Shiela Kaul had made ten different
categories of persons as the basis for deciding allotments, but even this categorisation
was not adhered to while making allotments. The further findings are:
(1)
"Many other organisations/persons who had also applied for allotment of
shops/stalls from time to time were not considered for allotment and no
reasons, whatsoever, were assigned for non-allotment of shops/stalls to
them"; and
(2)
"At the time of discretionary allotments made by Smt. Shiela Kaul in 1992
and 1994 persons who were relations of her personal staff were considered and
allotted shops."
7. In
the order dated 19.7.1996 this Court noted that a regular case under sections
120/B, 420,468/471 IPC and section 13(2) read with 13(1) (d) of the Prevention
of Corruption Act, 1988, has been registered against Smt. Shiela Kaul and her
Addl. Private Secretary Rajan S. Lala and others. The order of that date has
also noted about various other steps taken, which include inssuance of show
cause why allotments of shops/stalls should not be cancelled. It was desired
that the notices be served within a week and the Estate Officer, after
considering their replies, if any, place a report before the Court within four
weeks.
8.
Such a report was filed under the affidavit of Shri Harcharan Jeet Singh,
Director of Estates, which was taken up for consideration on 16.9.1996. The
affidavit of the Director has stated that from 1994 onwards 52 shops/stalls had
been sanctioned by the then Minister of Urban Development (Smt. Shiela Kaul)
out of which 7 shops were allotted by Smt. Kaul before she had approved policy
of 1994 and the remaining 45 shops were allotted after the policy of 1994. In
the affidavit the gist of the objections filed by the various allottees was
enclosed. This Court thought it appropriate to give an opportunity of hearing
to all these persons before any action was taken. A direction was, therefore,
given to the Director to issue individual notices to the 52 persons (wrongly
mentioned as 42 in the order) to be personally present in the Court or be
represented through their counsel on 27th September. These alottees so appeared
either in person or through counsel and they were heard.. The sum and substance
of the representations of the allottees was that they had been given an
allotment either because of their being unemployed youths, freedom fighters,
handicapped, members of Scheduled Castes/Scheduled Tribes, widow or
poverty-stricken.
9.
Question is whether they were selected in accordance with law, which aspect as
its importance because apparently a large number of other persons could as well
fall within the categories in question and had applied also? From the report of
the CBI it is clear that the alottees had been selected, not by following the
tender system, as required by the policy of 1994, but because of their
relationship with the Minister or her personal staff, or being employees or
friends of such persons. If that be so, the allotments were wholly arbitrary
and speak of misuse of power. All important question is what is required to be
done to undo the wrong and how the wrong doer is to be dealt with within the
parameters known to law.
10. It
would be apposite in this contact to refer to the recent decision of this Court
in Writ Petition (C) No.26 of 1995 (Common Cause, a Registered Society v. Union
of India) rendered on September 25, 1996, in which one of us (Kuldip Singh,J.)
reiterated the need to act fairly and justly in the matter of grant of largesses,
pointing out that any arbitrary distribution of national wealth would violate
the law of the land. Mention was made of the judgment in Lucknow Development
Authority v. N.K. Gupta, 1994(1) SCC 243, stating that the same approved
"misfeasance in public office" as a part of the law of the tort. It
was pointed out that public servants become liable in damages for malicious,
deliberate or injurious wrong- doing.
11. A
reference to Wade's 'Administrative Law' shows that a breach of statutory duty
does give rise in public law to liability, which has come to be known as
"misfeasance in public office", and which includes malicious abuse of
power.
This
aspect has been dealt at pages 789 et al of 7th Edition. It has been stated
that public authorities or officers may be liable in damages for malicious,
deliberate or injurious wrong-doing. The Supreme Court of Canada in Ron Carelli
v. Duplejis (1959) 16 DLR (2d) 689 awarded damages against the Prime Minister
of Quebec personally for directing the cancellation of a restaraunt-owner's
liquor licence. The Supreme Court of Victoria in Farrington v.
Thomson,
1959 VR 280, awarded damages against a licensing inspector and a police officer
who had ordered the plaintiff to close his hotel and cease supplying liquor,
though they knew they did not posses such a power. Smith J.
referred
in that case to the statement of Best CT made in Henly v. Lyme Corpn., (1858) 5
Bing 91 at 107 reading as below:- "Now I take it to be perfectly clear,
that if a public officer abuses his office, either by an act of omission or
commission, and the consequence of that is an injury to an individual, an
action may be maintained against such public officer. The instance of this are
so numerous that it would be a waste of time to refer to them."
12.
The learned author has then opined that the cases establish that the tort of
misfeasance in public offices goes at least to the length of imposing liability
on public officer who does an act which to his knowledge amounts to an abuse of
his office.
13. We
may also note what has been stated in this regard in "Cases and Materials
on Administrative Law" by SH Bailey and others at pages 826 et al of 2nd
Edition. The authors have noted the decision rendered in Bourgoin SA v. Minister
of Agriculture, Fishery and Food, 1985-3 All ER 585, on the subject of
misfeasance. In that case damages were claimed against a Minister, which was
held permissible.
Lord Diplock's
observation in Dunlop v. Woolllahar Municipal Council, 1982 AC 158, that this
was "well established" position was noted.
14.
From the aforesaid it is clear that the above has been accepted as a part of
the law of tort practically all over the world. What is more, in some countries
exemplary damages have been awarded for misuse of public power.
Reference
may be made to Deshpriya and another v. Municipal Council, Nuwara Eliva &
Others. which a decision of the Supreme Court of Sri Lanka dated 10.3.1995,
noted at pages 115 to 117 of 1996(1) Commonwealth Human Rights Law Digest
(CHRD). Therein, aggravated award was ordered where political discrimination
was the motive for restricting freedom of expression. The Supreme court of Bahamas in the case of Tynes v. Barr, by a
decision rendered on 28.3.1994, ordered for exemplary damages for arbitrary,
oppressive or unconstitutional action by State Officials. A summary of this
decision is reported at pages 117 to 120 of the aforesaid Law Digest. The need
for awarding exemplary damages was felt by Sauyer, J. because of the arrogant,
abusive and outrageous disregard shown by the police for the law. The learned
Judge awarded $40,505 as special damages; $ 75,000 for assault, battery and
false imprisonment; $ 1,00,000 for malicious prosecution and $ 40,000 for
breach of the plaintiff's constitutional rights. Reference may also be made to
the decision of supreme Court of Jamaica in Samulls v. Attorney General (noted at pages 120 to 122 of the
aforesaid Digest) in which Reckford, J. by his decision dated 11.11.1994
awarded exemplary damages for assault, battery and malicious prosecution. The
award was quantified at $ 1,00,000.
15.
The world jurisprudence has thus accepted misfeasance in public office as a
species of tortious liability and, to prevent misuse, different courts across
the sea have been awarding exemplary damages.
16. We
are conscious that the aforesaid cases dealt with injury to a third party
(following misuse of power) who had sought damages for the loss caused, whereas
in the present case there is no injury as such to any third person.
Even
so, the aforesaid cases have been referred for two purposes. Firstly and
primarily to bring home the position in law that misuse of power by a public
official is actionable in tort. Secondly, to state that in such cases damages
awarded are exemplary. The fact that there is no injury to a third person in
the present case is not enough to make the aforesaid principles non-applicable
inasmuch as there was injury to the high principle inasmuch as there was injury
to the high principle in public law that a public functionary has to use its
power for bonafide purpose only and in a transparent manner. Insofar as the
aspect of loss is concerned, it deserves to be pointed out that there was loss
in present case also; and this was to the State Exchequer resultant upon giving
of allotments without calling tender as required by the policy. Needless to say
that if tender would have been called, higher revenue would have been earned by
the State on giving the allotments. For these reasons, we are of the view that
the mere fact that in the present case there is no injury to a third person and
he has not come forward to claim damages, has no sequitur in so far as the tortious
liability following misfeasance of public office is concerned.
17.
Now, to take care of the illegality, we have to take two steps. First, cancel
the allotments. To decide as to who should get the shops/stalls, the Government
would first consider whether its policy of 1994 and categorisation made by it
need alteration in any way. While undertaking this work, the Government would
make such provisions in the policy which are just and fair. After the policy
has been framed, the shops/stalls would be allotted as per the policy and by
following a procedure having the sanction of law. In case it would be that any
of the present allottees would not be the person so selected, he/she shall be
asked to vacate the shop/shall by giving three months time. We would require
the Government to formulate the policy within two months and thereafter to
complete the exercise of allotment within two months. Till then, the present allottees
would be allowed to continue.
18.
Secondly, Smt. Shiela Kaul, who was prima facie personally responsible for the
illegal allotments, has to be asked to show cause as to why damage should not
be awarded against her for her alleged misuse of power. So, a notice be issued
to her to how cause why she should not asked to pay such sum as damages, for
each of the illegal allotments made by her, as this Court would deem just and
proper. The cause would be shown within three weeks of the receipt of this
order.
19.
The issue relating to the matter of illegal allotments of the aforesaid 52
shops/stalls, stands disposed of accordingly. It may be put up for further
orders on 1st November,
1996.
20.
Let a copy of this order be served on Smt. Shiela Kaul urgently to enable her
to act as ordered in the judgment. Steps in this regard shall be taken by the
Registry within three days.
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