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Thiruvengadam v. Muthu Chettiar And Another

Madras High Court
Jul 30, 1968
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Structured Summary of the Opinion (Veeraswami, O.C.J.)

Factual and Procedural Background

This appeal arises from an order of Kailasam, J., dismissing in limine a petition under Article 226 of the Constitution seeking to quash a State Government order dated 16 November 1967. That order granted the first respondent a permit under Section 5 of the Rice Milling Industry (Regulation) Act, 1958 (read with Government of India Notification G.S.R. 512 dated 22 April 1959) to establish a new rice mill at Enadhi Village, Pattukottai Taluk.

The first respondent applied for the permit on 8 November 1966; the site was approved on 10 January 1967; and the Panchayat Union Council reportedly gave permission on 13 March 1967. The permit prescribed a period within which the mill should be established. Since then the first respondent has constructed and installed the mill and incurred substantial expenditure.

The appellant, who represents a local temple located approximately 65 feet from the mill site, objected to the grant of the permit. The objections (also supported by some villagers) alleged that the mill would cause inconvenience to worshippers during festivals and that decortication vibrations might damage the temple building. The impugned government order is silent as to the objections, although its preamble shows reference to the District Revenue Officer's report dated 31 July 1967.

Kailasam, J. had dismissed the writ petition in limine relying on earlier writ petitions (W.P. Nos. 2132 and 2298 of 1966 (Mad)), viewing a Section 5 permit as an administrative order and the petitioners as not being persons aggrieved. The present appeal challenges that dismissal. Counsel for the appellant (Mr. G. Ramaswamy) argued that a Section 5 order is quasi-judicial and that the appellant, as an objector, is a person aggrieved. The Government Pleader contended that the appellant cannot be regarded as aggrieved.

Legal Issues Presented

  1. Whether an order granting a permit under Section 5(4) of the Rice Milling Industry (Regulation) Act is administrative in character or quasi-judicial in nature.
  2. Whether the appellant (a temple representative and objector) is a "person aggrieved" with locus to challenge the permit granted under Section 5.
  3. Whether absence of ex facie reasons in the grant order (in particular, lack of explicit dealing with objections) vitiates the order and warrants quashing by certiorari.

Arguments of the Parties

Appellant's Arguments (as presented)

  • The power of the Government under Section 5 is, given its nature and the manner of its exercise, quasi-judicial; therefore an objector (the appellant) is a person aggrieved and entitled to challenge the order under Article 226.
  • The impugned order is silent on the objections and does not give reasons for rejecting them; as a quasi-judicial order it is vitiated by failure to record reasons and thus susceptible to certiorari.
  • Counsel relied on decided cases to submit that whether a power is quasi-judicial depends on the nature of the power, the manner of its exercise and how it affects rights of parties.

Respondent / Government Arguments (as presented)

  • The order under Section 5 is administrative in character; petitioners in prior similar petitions were not regarded as persons aggrieved and the writ petitions were dismissed in limine.
  • The appellant cannot be regarded as a person aggrieved because he lacks a special interest distinct from the general public interest or general inconvenience; his complaint is one of nuisance about the mill's operation rather than about the grant of the licence itself.

Table of Precedents Cited

Precedent Rule or Principle Cited For Application by the Court
W.P. Nos. 2132 and 2298 of 1966 (Mad) Used by Kailasam, J. to treat rice-mill permit orders as administrative and to hold petitioners were not aggrieved. The opinion records that Kailasam, J. relied on these cases in dismissing the writ petition in limine; the present Court considered them but reached its conclusion on statutory construction and record review.
Board of High School and Intermediate Education U.P. v. Ghanshyam Das, (1963) 2 SCJ 509 : AIR 1962 SC 1110 Sets out that whether an authority must act judicially depends on statute's express provisions, nature of rights affected, manner of disposal, objective criteria, effect on persons — indicia to determine a duty to act judicially. The Court quoted and accepted the broad proposition that the inference whether a duty to act judicially arises depends on statutory indicia; it applied that test to Section 5 and the Act as a whole.
Ridge v. Baldwin, (1963) 2 WLR 935 : (1963) 2 All ER 66 : (1964) AC 40 Illustrates that failure to observe principles of natural justice can vitiate an order; involved dismissal under Section 191(4) of English Police Act where the officer was not informed of the ground and not given opportunity to explain. The Court cited Ridge but noted the English case does not support a broad rule that every public authority order affecting rights must allow representations; used it to explain limits of the natural justice principle.
Sadhu Singh v. Delhi Administration, (1966) 1 SCJ 215 : (1964) 1 SCR 243 : AIR 1966 SC 91 Shows the Supreme Court's view that Ridge does not establish a universal rule that any order affecting rights must grant opportunity of representation in every case. The Court referred to Sadhu Singh to support the proposition that even where authority's exercise affects parties, it is not automatic that the power is quasi-judicial; the scheme and intendment of the statute must be examined.
P.L.L. Ramanathan Chettiar v. Board of Revenue, Madras, ILR (1964) 1 Mad 151 : (1963) 2 Mad LJ 320 Authority reflecting the position under the Rice Milling regulatory scheme (court noted conformity with the view expressed in the present opinion). The Court stated its view was in conformity with this decision, using it as supportive precedent for treating Section 5 orders as administrative in character.
Orders in Writ Appeal No. 195 of 1962 and W.P. No. 43 of 1964 (Mad) — Lakshmi Ammal v. Commissioner of Civil Supplies, ILR (1964) 2 Mad 869 : (1965) 1 Mad LJ 119 Earlier decisions on related issues under the Rice Industry (Regulation) Act; the Court noted these left some questions open. The Court observed these orders left the question open but stated that its present view accords with them; it did not rely on them as decisive authority to change the analysis.
S.M. Transport (Private) Ltd. v. Raman and Raman (Private) Ltd., (1961) 2 Mad LJ 127 : ILR (1961) Mad 110 : AIR 1961 Mad 180 (FB) Defines "person aggrieved" as one having an interest distinct from general inconvenience; cites earlier English authority (Rex v. Richmond Confirming Authority; Ex parte Howitt). The Court applied this principle to conclude the appellant did not have the requisite special interest distinct from the general public to be a person aggrieved in respect of the licence grant.
Rex v. Richmond Confirming Authority; Ex parte Howitt (1921) 1 KB 248 & Rex v. Groom; Ex parte Cobbold (1901) 2 KB 157 English authorities cited in S.M. Transport to explain the test for special interest vs. general inconvenience when assessing aggrievement. These English authorities were incorporated into the S.M. Transport ratio; the present Court relied on the S.M. Transport formulation to assess whether the appellant was a person aggrieved and found he was not.

Court's Reasoning and Analysis

The Court conducted a focused statutory and record-based inquiry. Its reasoning proceeded in the following steps:

  1. Statutory character analysis: The Court examined Section 5 and the Act as a whole and concluded the Act is a regulatory measure intended to regulate the rice milling industry in the interest of the public. It noted:
    • Section 5(3) ties grant of permits to necessity for adequate supply of rice.
    • Section 5(4) prescribes the procedure for grant and lists matters to be considered and requires a full investigation in the prescribed manner.
    • Other provisions of the Act deal with restrictions, inspection powers, penalties, offences and delegation.
    • Section 12 does not provide a right of appeal against an order under Section 5.

    On this statutory matrix the Court concluded that an order under Section 5(4) is administrative in character rather than quasi-judicial. The Court emphasized that although the authority must consider specified matters and direct an investigation, the power is regulatory and not directed to adjudicating private rights in the manner of a judicial or quasi-judicial tribunal.

  2. On the relevance of quasi-judicial character: The Court acknowledged that quasi-judicial orders must, as a rule, set out reasons; administrative orders may also sometimes be required to give reasons depending on circumstances, but failure to state reasons does not automatically vitiate an administrative order. Instead, the Court may examine records to see whether the authority applied its mind reasonably to statutory provisions and facts.
  3. Record examination and application of mind: The Court inspected the record. It noted that the impugned order referred to the District Revenue Officer's report (dated 31 July 1967) and that report considered objections by worshippers and the appellant and recommended that those objections might be overruled. The Court also noted the District Supply Officer, who conducted the investigation under Section 5(4), made a report which the appellant characterized as showing substance in the objections, and that the Government's order did not explicitly address that characterization. Nevertheless, after reviewing the reports and the impugned order the Court was satisfied that the Government had applied its mind to the relevant statutory matters and the objections, and had rejected them for reasons reflected in the investigative reports even though those reasons did not appear ex facie in the order.
  4. On locus/“person aggrieved”: The Court considered whether the appellant had a special interest distinct from the general public sufficient to qualify as a person aggrieved. Citing S.M. Transport and related authorities, the Court adopted the test that an applicant must have an interest distinct from general inconvenience caused by alleged wrongful administration. The Court found that the appellant, a temple trustee/worshipper, was not a rival applicant nor an owner or otherwise interested in the statutory matters under Section 5(4). The alleged consequences (inconvenience to worshippers, possible effect on temple building) were not consequences directly connected to or flowing from the licence itself; any complaint of nuisance would be against the running of the mill, not the licensing decision, and would require separate proceedings. Therefore, the appellant was not a person aggrieved.

Holding and Implications

HOLDING: The appeal is dismissed. The Court held that an order under Section 5(4) of the Rice Milling Industry (Regulation) Act is administrative in character, the Government had applied its mind to the relevant objections reflected in the investigative reports, and the appellant is not a person aggrieved entitled to challenge the permit under Article 226 on the basis urged.

Direct Implications for the Parties:

  • The government's permit granting to the first respondent stands; the challenge was dismissed and the permit was not quashed.
  • The appellant was denied locus to maintain the writ petition and the Court found his proper remedy, if any, lay in separate proceedings directed at nuisance or the operation of the mill rather than in proceedings attacking the permit.
  • The appeal was dismissed with costs; counsel's fee was fixed at Rs. 100.

The opinion applies and aligns itself with existing authorities cited; it does not purport in the text to lay down a new or broader precedent beyond applying those principles to the statutory scheme and the record in this case.

Show all summary ...

Veeraswami, O.C.J:— This Appeal arises from an order of Kailasam, J., dismissing in limine the petition under Art. 226 of the Constitution to quash an order of the State Government, dated 16th November, 1967 granting to the first respondent a permit under Section 5 of the Rice Milling Industry (Regulation) Act, 1958, read with the Government of India Notification G.S.R 512, dated 22nd April, 1959 for establishing a new rice mill at Enadhi Village, Pattukottai Taluk. The first respondent applied for a permit on 8th November, 1966, the site was approved on 10th January, 1967 and it would appear that the Panchayat Union Council gave its permission for granting of a licence on 13th March, 1967. The permit issued to the first respondent prescribed a period within which he should establish the rice mill.

2. It is stated that since then the first respondent has put up the construction and installed a mill thereby incurring a heavy expenditure. The appellant representing a local temple which is 65 feet removed from the site on which the rice mill is located, raised certain objections which are also supported by some of the villagers who were worshippers. The objections were that the establishment of the rice mill so near the temple would cause inconvenience to the worshippers particularly at the time of the festival. Further, if decortication were to be permitted, the vibration emanating would affect the temple building. The impugned order of the Government granting the permit is silent about the objections. But the preamble to the order shows that the District Revenue Officer's report, dated 31st July, 1967 had been referred before the decision to grant the permit was arrived at. Kailasam, J., in dismissing the writ petition in limine stated that he did so in view of the decision of this Court in W.P Nos. 2132 and 2298 of 1966 (Mad). Those cases related to rice mill permits, as in the present appeal. The learned Judge took the view that an order granting permit was an administrative order and that the petitioners in those cases could not, in any case, be regarded as aggrieved. Mr. G. Ramaswamy for the appellant contends that an order under Section 5 of the Rice Milling Industry (Regulation) Act, is having regard to the nature of the power, a quasi-judicial order and that the appellant being an objector is also a person aggrieved. He says that inasmuch as the impugned order of the Government does not ex facie show that the objection had been dealt with and does not give reasons for rejecting them, it is as a quasi-judicial order, vitiated, which, for the reason, can be removed by this Court by certiorari. In support of his contention as to the nature of the power of jurisdiction of the Government under Section 5, he has invited our attention to certain decided cases to show whether the power or jurisdiction is quasi-judicial in character will depend upon its nature, the manner of its exercise and how it affects the rights of parties. The proposition formulated in that broad manner is unexceptionable. A power can be said to be quasi-judicial in character, if it confers authority to decide rights or liabilities which affect parties, and the statute which confers the power also indicates that there is a duty in exercising the power to act quasi-judicially. Board of High School and Intermediate Education U.P Allahabad v. Ghanshyam Das, (1963) 2 SCJ 509 : AIR 1962 SC 1110 observes:

“The inference whether the authority acting under a statute where it is silent has the duty to act judicially will depend on the express provisions of the statute read along with the nature of the rights affected, the manner of the disposal provided, the objective criterion if any to be adopted, the effect of the decision on the person affected and other indicia afforded by the statute. A duty to act judicially may arise in widely different circumstances which it will be impossible and indeed inadvisable to attempt to define exhaustively.”

In Ridge v. Baldwin, ((1963) 2 WLR 935 : (1963) 2 All ER 66 : (1964) AC 40), the second requirement of duty to act judicially was considered to be unnecessary in relation to a question whether the principles of natural justice had not to be followed in making an order under Section 191(4) of the English Police Act. That sub-section specified the grounds on which a constable could be dismissed from service, and, the particular ground on which the dismissal was made, having not been made known to the officer concerned and his explanation asked for, the House of Lords was of the view that on account of failure to observe the principles or natural justice, the order was vitiated. Referring to (1963) 2 WLR 935 : (1963) 2 All ER 66 : (1964) AC 40, the Supreme Court in Sadhu Singh v. Delhi Administration., (1966) 1 SCJ 215 : (1966) Mad LJ (Cri) 153 : (1964) 1 SCR 243 : AIR 1966 SC 91, pointed out that the English case did not support the broad proposition that no order of public authority which affected the rights of a person might be made without giving that person an opportunity of making a representation against the proposed order. It seems to us that even where there is authority the exercise of which affects parties, it cannot be taken as a rule that an order made in exercise of such power is necessarily quasi-judicial in character. The nature of the order will further depend upon the scheme and intendment of the provisions of the Act which confers the power and which may throw light on the question.

3. So far as an order made under Section 5 of the Rice Milling Industry (Regulation) Act is concerned, we are of the view that having regard to the provisions of that section and of the Act as a whole, it is administrative in character. The Act is intended to regulate the rice milling industry in the interest of the general public. The Act is essentially a regulatory measure. Sub-section (3) of Section 5 says that grant of a permit under sub-section (4) is related to the necessity for ensuring adequate supply of rice and sub-section (4) prescribes the procedure for grant of a permit. It specifies a number of matters which ought to be taken into account in granting a permit, and, for that purpose, the Government should cause a full and complete investigation to be made in the prescribed manner. The other provisions of the Act bear on restriction on rice mills, power of inspection returns, penalties, certain offences and delegation of powers.

We may particularly notice that Section 12 which provides for appeals, does not give a right of appeal against an order under Section 5. That by itself is not conclusive but on a consideration of these provisions we are clearly of opinion that an order under sub-section (4) of Section 5 is in its effect but administrative in character. It is true that in the course of exercising the power to grant a permit, the authority vested with the power is enjoined to have regard to the specified matters and for that purpose, an investigation ought to be directed. But beyond that the power to grant permit is not one to decide rights as such. It is contended by Mr. Ramaswamy that refusal of a permit may affect fundamental rights, but, in our view, that general consideration does not after the true character of the power under Section 5(4). It is a regulatory power which is justified by its being reasonable and intended to serve public interest.

4. A few cases which this Court had occasion to decide under the Rice Industry (Regulation) Act have been brought to our notice on that aspect of the question, but on the view we have taken, it does not appear to us to be necessary to refer to them in detail. The view we have expressed is, however, in con formity with P.L.L Ramanathan Chettiar v. Board of Revenue, Madras, ILR (1964) 1 Mad 151 : (1963) 2 Mad LJ 320, and the orders in Writ Appeal No. 195 of 1962 and W.P No. 43 of 1964 (Mad) Lakshmi Ammal v. Commissioner of Civil Supplies, ILR (1964) 2 Mad 869 : (1965) 1 Mad LJ 119, left the question open.

5. The question whether an order is quasi-judicial or administrative in character arises not with reference to the scope of the power of this Court under Art. 226 of the Constitution. The power under the Article is not confined to judicial or quasi-judicial orders, but it is within its ambit to review even administrative orders, if only to see that they conform to the rule of law and are within the limits of the grant of the relevant powers. The relevancy of the character of the order as quasi-judicial is that in the case of such orders they are bound to set out the reasons therefor. That is however, not to imply that administrative orders, as a rule are not required to set out reasons. There may be cases in which the circumstances may call for setting out reasons. But, in case of failure to do so it may not follow that the orders are necessarily bad. It will be open to the Court to examine the records and satisfy itself whether the authority exercising the power in deciding a matter has reasonably applied its mind to the appropriate statutory provisions and the facts.

6. In the instant case, on a reference to the record, we are satisfied that the licensing authority, in making the impugned order under Section 5 has applied its mind to all the relevant matters enjoined by the statutory provision to be taken into account and to the facts relating to them, though of course this does not appear ex facie the order. As we said, the order does refer to the report from the District Revenue Officer. We have looked into that report which has considered the objections from the worshippers and the appellant in relation to the temple and suggested that they might be overruled. When this report was referred to in the impugned order there is no reason in the circumstances to think that the Government did so mechanically. What is, however, stated for the appellant is that the District Supply Officer, who actually carried out the investigation contemplated by Section 5(4) and made a report made it appear to the appellant that there was substance in the objections on behalf of the temple, and that, the fact that the report was surprisingly against the temple was brought to the notice of the Government and there is nothing in the impugned order dealing with that aspect. But, the substance of the matter is whether the Government applied its mind to the objections on behalf of the temple and rejected them. That, we are satisfied, they did.

7. Learned Government Pleader contended that the appellant. In any case, cannot be regarded as an aggrieved person. Though, on the view which we have already expressed, this question does not require to be considered, nevertheless we may briefly express our view. A person can be said to be aggrieved, if apart from the general interest such a person, as a member of the public, may have, he has a particular or special interest in the subject-matter supposed to be wrongly decided. In S.M Transport (Private) Ltd. v. Raman and Raman (Private) Ltd., (1961) 2 Mad LJ 127 : ILR (1961) Mad 110 : AIR 1961 Mad 180 (FB), which arose under the provisions of the Madras Motor Vehicles Act, this Court after referring to the observations of Earl of Reading, C.J, in Rex v. Richmond Confirming Authority, Ex parte Howitt, (1921) 1 KB 248 and also Rex v. Groom; Ex parte, Cobbold, (1901) 2 KB 157, laid down the true principle in these words:

“The true principle is to determine whether the applicant has an interest distinct from the general inconvenience which may be suffered by the law being wrongly adrninistered.”

We do not see how, in that sense, the appellant can be said to be aggrieved in the matter of grant or refusal of licence to the first respondent under Section 5. He purports to be a trustee or worshipper of the temple. He is not a rival applicant for a rice mill permit nor is he the owner of a rice mill, nor as far as we are able to see, is he interested in the matters specified in S. 5(4) of the Act. It is true the averment is that the running of a lice mill 65 feet away from the temple may cause inconvenience to the worshipping public and also may affect the temple building. Whether it is so or not, that is not a consequence which is directly connected with or flows from the rice mill licence. The complaint of nuisance, if at all is directed against the running of the rice mill and not the permit itself. The remedy of the appellant, in such a case if it is available, is not in respect of the licence and has to be sought in separate proceedings. In our view, the appellant is not a person aggrieved.

8. The appeal is dismissed with costs.

9. Counsel's Fee Rs. 100.

10. Appeal dismissed.