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REPORTABLE

IN THE SUPREME COURT OF INDIA

CIVIL APPELLATE JURISDICTION

CIVIL APPEAL NO. 4475  OF 2015 (Arising out of SLP (C) No.25607 of 2013  

Manyata Devi …Appellant

Vs.

State of U.P. & Ors. …Respondents

J U D G M E N T

T.S. THAKUR, J.

1.    Leave granted.

2. This appeal arises of out an order dated 2nd April, 2013,

passed by the High Court of Judicature at Allahabad whereby

Writ  Petition No.17398 of 2013 filed by the appellant has

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been  dismissed  and  the  order  passed  by  the  District

Magistrate, Basti, refusing to issue a character certificate in

favour of the appellant upheld.

3. The appellant appears to have applied to the District

Collector, Basti, for a character/enlistment certificate in her

favour,  which  it  appears  is  one  of  the  requirements

prescribed  for  registration  as  a  contractor  under  the

Irrigation  Department  of  the  State  of  Uttar  Pradesh.  The

appellant,  as  proprietor  of  M/s  Krishna  Construction  was

already  registered  as  a  contractor  but  since  the  said

registration was valid only for a period three years ending

31st June, 2009, a fresh character/solvency certificate was

necessary for renewal of her registration.  

4. The application made by the petitioner appears to have

remained unattended for some time forcing her to file Writ

Petition  No.17945 of  2010 which  was  disposed  of  by  the

High Court by its order dated 5th April, 2010 directing the

District  Magistrate,  Basti,  to  consider  and  decide  the

application of the appellant within a period of six weeks. The

District Magistrate in compliance with the said order issued a

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solvency certificate in favour of the appellant on 24th May,

2010 but deferred the grant of character certificate till such

time the Superintendent of Police inquired into the matter

and submitted a report. On receipt of the report from the

Superintendent of Police, the District Magistrate passed an

order dated 15th June, 2010 declining to issue the character

certificate to the appellant on the solitary ground that her

husband was involved in four criminal cases during the past.

5. Aggrieved by the refusal of the character certificate in

her favour, the appellant filed Writ Petition No.9875 of 2011

before the High Court which was disposed of by the High

Court  on  14th February,  2012  with  a  direction  that  the

appellant  should  approach  the  Commissioner  in  appeal

against  the  order  passed  by  the  District  Magistrate.  The

appellant  accordingly  preferred  an  appeal  before  the

Commissioner, Basti, who set aside the order passed by the

District Magistrate and remitted the matter back to him for

appropriate orders with the observation that the request for

grant of a character certificate must be considered on the

basis of the personal character of the person applying for

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the same and not of her family members. Notwithstanding

that direction, the District Magistrate once again passed an

order dated 12th December, 2012 rejecting the prayer for the

issuance of a character certificate on the ground that the

appellant  did  not  have  any  knowledge  of  contract  works

which works were being got executed by her through her

son and other  persons.  The appellant  challenged the said

order  before  the  High  Court  in  Writ  Petition  No.17398 of

2013 which came to be dismissed by the High Court by its

order dated 2nd April, 2013. Hence the present appeal.

6. We have heard learned counsel for the parties at length

and perused the orders  passed by the District  Magistrate

and the Commissioner and those passed by the High Court.

The material facts are not in dispute. It is not in dispute that

the  appellant  is  the  sole  proprietor  of  M/s  Krishna

Construction.  It is also not in dispute that the appellant was

a registered contractor with the Irrigation Department of the

Government of U.P. for executing civil works. It is also not

disputed that the registration was earlier granted in favour

of  the  appellant  pursuant  to  a  solvency  and  character

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certificate  issued in  her  favour  by  the District  Magistrate,

Basti.  It  is  common  ground  that  the  registration  of  the

appellant remained valid  upto 31st June, 2009, whereafter

the  same  required  a  renewal  based  on  a  fresh  solvency

certificate  and  a  character  certificate  according  to  the

applicable  norms prescribed by the Irrigation Department.

That  a  solvency  certificate  was  issued  in  favour  of  the

appellant is also not in dispute. So also there is no dispute

that  the appellant  is  not  involved in  any criminal  case or

activity of any objectionable kind. That being the position,

the  District  Magistrate  should  have  simply  certified  her

character  because  that  was  the  only  question  which  the

former was called upon to examine while dealing with the

request  made  by  the  appellant.  The  District  Magistrate,

however, appears  to  have been  swayed by considerations

wholly extraneous to the question whether the appellant had

a good moral character.  In the first order of refusal passed

by him, he opined that since the appellant’s husband had

criminal  cases  registered  against  him, she was disentitled

from claiming a certificate  of  good moral  character. Apart

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from the fact that the cases against the appellant’s husband

to which the District Magistrate appears to be referring had

ended  in  his  acquittal,  it  is  difficult  to  appreciate  how

criminal  cases  registered  against  the  husband  of  the

appellant could possibly deny her a certificate of good moral

character. The Commissioner, Basti was, therefore, perfectly

justified  in  setting  aside  the  order  passed by the District

Magistrate and directing him to consider the request for the

issue of a certificate based on the character of the applicant

and not her relative or member of the family.  Since there

was nothing adverse about the appellant,  one would have

expected  the  District  Magistrate  to  issue  the  requisite

certificate in favour of the appellant. Instead of doing so, the

District Magistrate appears to have invented fresh reasons

for  denial  of  a  certificate.  This  time,  the  certificate  was

denied not because the appellant or anyone in her family

was implicated in any criminal case but on the ground that

she  had  no  experience  in  getting  the  contract  works

executed. We have not been able to appreciate as to how

the District Magistrate could have brought in the question of

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the appellant’s capability as a contractor or her experience in

executing  works  to  bear  upon  her  good  moral  character.

Even when the appellant  may have had no experience  in

getting government works executed she could still claim that

she bore a good moral character. The reasoning given by the

District  Magistrate  was wholly  irrelevant  to  say the least.

Inasmuch  as  the  District  Magistrate  ignored  the  order

passed  by  the  Commissioner  and  the  considerations  that

would go into grant or refusal of the character certificate, he

committed a mistake that is palpable on the face of record.  

7. It was argued on behalf of the respondent-State that

since  the  appellant  had  no  experience  of  executing

contracted works, the refusal of a character certificate was

only  meant  to  prevent  her  from  getting  registered  as  a

contractor with the department. It was also argued that the

registration of a contractor was necessary and unless such

registration was granted only in deserving cases, the very

purpose of the registration would stand defeated. There was,

according  to  learned  counsel  for  the  respondent,  a

“contractors mafia” operating in the State of Uttar Pradesh

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which demanded that registration is granted only to people

who  have  no  criminal  background  so  that  genuine

contractors are not prevented from winning contracts from

the Government and competing for allotment of works. It

was argued that since the husband of the appellant could

not  himself  be  registered  on  account  of  his  criminal

background, the appellant was being projected for such a

registration only to make it possible for the husband to carry

out the works in the name of his wife.  Registration of the

appellant, in such a situation, would defeat the very purpose

behind such registrations, argued the learned counsel.  

8. There  is  no  quarrel  with  the  proposition  that

registration can be insisted upon by the State Government

or its departments for purposes of allotment of works and

participation in auctions relating thereto.  There is  also no

difficulty in the State providing for production of a character

certificate as one of the conditions of eligibility.  Experience

of the Contractor, if considered relevant for the purposes of

such  registration,  could  also  be  stipulated  as  one  of  the

requirements  to  be  satisfied  by  the  applicants  under  the

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Rules or Regulations. That such regulation ought to ensure

participation  of  only  genuine  contractors  and  prevent  the

mafia from hijacking the system cannot also be faulted.  The

question, however, is whether that purpose which is indeed

laudable could be achieved by a side wind viz. by the District

Magistrate  denying a character  certificate  to an applicant.

Our answer is in the negative. We say so because the very

fact that a character certificate is issued does not mean that

everyone who has such a certificate gets a vested right to be

registered as a contractor. The District  Magistrate  did  not

have any authority under the rules stipulating registration of

contractors to consider such requests for registration or to

grant or refuse the same. It is the competent authority in

the Irrigation Department concerned who has to take a call.

Inasmuch as the District Magistrate took upon himself the

duty of  examining whether  the appellant  was suitable  for

registration,  he went beyond the legitimate sphere of  the

jurisdiction vested in him which was limited to considering

the request for issuance of a character certificate.  

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9. Having said  so,  we must  add that  copy of  the rules

regulating  the  registration  of  contractors  has  not  been

produced by the State. It is, therefore, difficult for us to say

whether the rules are comprehensive enough to disentitle

persons who do not have any experience in execution of the

contract works from claiming registration.  But there is  no

manner of doubt that, if the ground situation in the State of

Uttar  Pradesh so  requires,  the department  concerned can

and indeed ought to strengthen the registration procedure

by framing new rules or amending the existing rules on the

subject making registration possible only upon satisfaction of

such conditions as may be prescribed by such rules including

experience in executing contracts as one such condition.    

10. In the result we allow this appeal, set aside the order

passed by the High Court and direct the District Magistrate

to reconsider the matter and dispose of the application for

grant  of  a  character  certificate  keeping  in  view  the

observations made herein. We make it clear that even when

the character certificate is issued by the District Magistrate

in favour of the appellant, the Competent Authority shall be

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free  to  examine  the  prayer  for  registration  or  renewal  in

accordance with law having regard to the requirements that

already exist or may be prescribed on the subject by the

authority competent to do so.  No costs.

……………………………………….…..…J.       (T.S. THAKUR)

……………………………………….…..…J.        (ROHINTON FALI NARIMAN)

……………………………………….…..…J.         (PRAFULLA C. PANT)

New Delhi May 15, 2015

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