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Reportable

IN THE SUPREME COURT OF INDIA

CIVIL APPELLATE JURISDICTION

CIVIL APPEAL NO.  6774 of 2015 (@ SLP(C) NO. 16650 OF 2012)

Poonam  ... Appellant

                               Versus

State of U.P. & Ors. ... Respondents

J U D G M E N T

Dipak Misra, J.

The  appellant  invoked  the  jurisdiction  of  the  High  

Court  of  Judicature at  Allahbad under  Article  226 of  the  

Constitution praying, inter alia, for issue of writ of certiorari  

for quashment of the order dated 2.3.2012 passed by the  

respondent  no.2,  Commissioner,  Azamgarh  Division,  

Azamgarh  in  Appeal  No.  85/109/153/334/M of  2008-12  

and  further  seeking  a  writ  of  Mandamus  against  the

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respondents not to interfere in the peaceful functioning of  

fair  price  shop  in  Gram  Sabha  Ardauna,  Tehsil  Sadar,  

District Mau.  

2. The facts that formed the bedrock of the writ petition  

are that a fair price shop being shop no. 2 was run by the  

5th respondent in Gram Sabha Ardauna, Tehsil Sadar, Block  

Ratanpura,  District  Mau,  which  was  allotted  to  him  by  

allotment  order  dated  11.5.2001  and  while  he  was  

continuing, on various complaints being made against him  

pertaining  to  non-distribution  of  essential  commodities,  

Sub-Divisional Magistrate, Sadar, District Mau ordered an  

enquiry  and  after  obtaining  the  report,  suspended  his  

licence and called for an explanation from him vide order  

dated 30.5.2008.  As the factual matrix would depict vide  

order  dated  3.6.2008  the  shop  of  respondent  no.5  was  

attached  to  another  shop  being  run  by  one  Bhupendra  

Singh and the respondent no.5 handed over the charge of  

shop  on  19.7.2008.   On  the  said  date  the  final  enquiry  

report  was  placed  before  the  Deputy  District  Magistrate,  

Sadar, District Mau and the report reflected that there was  

improper distribution of essential commodities in violation  

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of instructions and accordingly the competent authority by  

its  order  dated  23.7.2008  cancelled  the  allotment  of  the  

respondent no.5.  

3. Being dissatisfied with the order of cancellation, the 5th  

Respondent preferred an appeal before the Commissioner,  

Azamgarh assailing the order dated 23.7.2008, along with  

an application for stay of the cancellation of allotment, but  

the  appellate  authority  declined  to  pass  any  interim  

protective  order.   Eventually,  the appeal  preferred by the  

appellant was allowed.  May it be stated that the appellant  

herein  had  got  herself  impleaded  in  the  appeal  on  the  

ground  that  she  had  been  allotted  the  shop  no.2  after  

cancellation of the allotment along with the licence granted  

in favour of the original allottee, the appellant therein.  

4. The appellate authority after hearing the appellant and  

the impleaded party and upon perusal  of  the file,  opined  

that the entire proceeding against the original allottee was  

initiated on the basis of the oral statements pertaining to  

the  allegations made by  some BPL card holders  that  the  

shopkeeper  had  told  them  that  their  cards  had  been  

cancelled; and there was no enquiry and investigation by  

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the Deputy District Magistrate from the official documents  

as regards the cancellation of original ration cards of  the  

BPL card holders;  that  the  allottee  was  not  provided  the  

copy of the investigation report and hence, he was deprived  

of opportunity to submit his clarification and on the whole,  

there were serious procedural lapses; and that on a careful  

scrutiny of number of aspects, it was perceptible that the  

investigation carried out by the Block Development Officer  

was  absolutely  faulty.   Being  of  this  view,  the  appellate  

authority by order dated 2.3.2012, allowed the appeal of the  

appellant,  restored  the  allotment  and  cancelled  the  

allotment of the subsequent allottee.

5. Aggrieved by the aforesaid order, the appellant herein  

who was the subsequent allottee  in  respect  of  shop no.2  

preferred C.M.W.P. No. 16390 of 2012 before the High Court  

which by the impugned order dated 3.4.2012 relied upon an  

earlier judgment in  Sri Pal Yadav v. State of U.P. and  

others1 and dismissed the writ petition on the ground that  

she  had  no  right  to  continue  the  litigation  being  a  

subsequent allottee, for she had no independent right.

1  2008 (1) ADJ 718

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6. Calling in question the legal defensibility of the order  

passed by the writ court, it is submitted by Mr. Dushyant  

Parashar,  learned  counsel  for  the  appellant  is  that  the  

approach  of  the  High  Court  is  absolutely  erroneous  

inasmuch as it had treated the allotment of the appellant in  

respect of the fair price shop as a stop gap arrangement and  

she had entered into the shoes of the original allottee and,  

therefore, her allotment was subject to attainment of finality  

of cancellation order totally remaining oblivious to the fact  

that  she  was  appointed  as  a  dealer  under  Visually  

Handicapped quota.   It  is  further  urged by him that  her  

rights being independent in nature, she has a right to assail  

the  appellate  order  and  the  High  Court  could  not  have  

dismissed the writ petition without adverting to the merits  

of the case.    

7. Mr. Vikrant Yadav, learned counsel appearing for the  

State,  per  contra,  would  contend  that  in  the  village  

Ardauna, two fair price shops were in existence and one was  

allotted to Mr. Bhupinder Singh and the other one to Mr.  

Arvind Kumar, the 5th respondent herein and on the basis of  

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the complaint made by the Gram Sabha, the Sub-Divisional  

Magistrate had attached the shop of respondent no.5 to the  

shop of Bhupinder Singh, after suspending his licence on  

3.6.2008  and  eventually,  an  order  of  cancellation  was  

passed;  and when the order of cancellation was set aside in  

appeal,  the  original  allottee  is  entitled  to  get  back  his  

allotment in respect of shop no.2. and hence, the appellant  

has no legal right to assail the order passed by the appellate  

authority.   Learned  counsel  for  the  State  would  further  

submit that shop no.2 having become available and there  

being  no  order  that  said  shop  is  declared  as  the  shop  

reserved for any kind of quota, either vertical or horizontal,  

the present appellant cannot assert any independent right  

in respect of the said shop.   

8. At the very outset, we must unequivocally state that  

we  are  not  required  to  enter  into  the  issue  whether  

cancellation was justified or not or the order passed by the  

appellate authority allowing the appeal is defensible in the  

facts and circumstances of the case, for the High Court has  

expressed its disinclination to enter into the said arena at  

the instance of the present appellant on the foundation that  

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she was an allottee after the cancellation of the allotment  

who was the licencee to run the fair price shop of the 5th  

respondent.   Learned  counsel  for  the  appellant  has  also  

rightly  not  advanced any argument  in that  regard except  

emphasising  on  the  facet  that  as  the  appellant  had  an  

independent right on her own the High Court was under the  

lawful  obligation  to  address  itself  with  regard  to  legal  

substantiality of the order passed by the appellate authority  

on the touchstone of exercise of writ jurisdiction, however  

restricted  it  may  be.   To  bolster  the  said  submission,  

immense emphasis is placed on the nature of the allotment  

made in favour of the appellant.   

9. Be  it  noted,  before  the  appellate  authority,  the  

appellant had got herself impleaded after coming to know  

that the 5th respondent had preferred an appeal challenging  

the order of  cancellation, and the appellate authority had  

considered the submissions of the original allottee as well as  

the present appellant.  The thrust of the matter is whether  

the  appellant  can  be  regarded  as  a  person  who  is  a  

necessary party to the lis in such a situation and is entitled  

under law to advance the argument that the order passed  

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by the appellate forum being legally unsustainable, the writ  

court was obliged to adjudicate the controversy on merits.  

10.  It  is  an admitted position that village Ardauna had  

initially two shops.  Shop no.2 was allotted in favour of the  

5th respondent and he was granted licence to run the fair  

price  shop.   On  the  basis  of  certain  complaints  being  

received  the  competent  authority  after  an  enquiry  had  

cancelled  the  licence.   The  appellate  authority  after  

ascribing  certain  reasons,  has  overturned the  said  order.  

The  effect  of  the  said  order  has  to  be  that  the  original  

allottee remains an allottee and his licence continues.   The  

appeal  was  preferred  challenging  the  cancellation  of  

allotment  and the  order  of  licence.   It  is  not  a  situation  

where the appeal had been treated to have been rendered  

infructuous on the basis of any subsequent event, such as,  

the shop in question has been demarcated for any reserved  

category.  In that event, such subsequent fact would have  

been brought to the notice of the appellate authority and in  

that event, possibly no relief could have been granted by the  

appellate  authority  to  the  appellant  except  removing  the  

stigma.  The stand of the State is that initially the shop no.2  

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was attached  to  the  other  licencee  and thereafter  on the  

basis of the resolution passed by the Gram Sabha, it was  

allotted to the present appellant though it was mentioned  

that it had been granted under the visually impaired quota.  

But the character of the shop remained the same.  

11.  At this juncture, it is obligatory on our part to refer to  

the  letter-circular  dated  1.2.2009  issued  by  the  Chief  

Secretary,  which  refers  to  the  Government  Order  dated  

17.8.2002 in respect of the scheduled caste, scheduled tribe  

and other backward classes.  Thereafter, there is reference  

to certain horizontal reservation which refers to the ladies of  

certain  reserved  categories,  family  members  of  the  army  

who had expired in  the  concerned  reserved category,  ex-

army personnel, freedom fighters of the concerned reserved  

categories and their wives and the handicapped persons of  

the  concerned  category.   After  so  stating,  the  circular  

proceeds to mention as under:-

“In this regard I was direction to say that for the  allotment  of  FPS  shop  in  the  rural  and  urban  area,  according  to  the  above  arrangement  Horizontal  reservation  is  also  approved,  under  

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which  there  is  arrangement  to  give  02%  reservation  to  the  candidate  of  handicapped  persons.   In  view  of  the  problem  of  the  blind  persons  after  appropriate  consideration,  the  administration  has  decided  that  the  blind  handicapped  be  granted  1%  reservation  under  Horizontal reservation. In this manner now to the  handicapped  person  in  place  of  2%  shall  be  approved 3% reservation and in this manner 1%  increased reservation shall be approved only for  the  handicapped  of  blind  persons.   In  this  manner in para no.3 of the Govt order sub para  Gh  adding  para  3(d),  the  handicapped  person  shall be granted 1% reservation.

In  this  manner  Horizontal  reservation  shall  be  36% in  place  of  35% which  is  under  the  total  reservation category of 50%.”

12. After issue of the said circular, a further letter dated  

12.8.2008 was issued which mentioned the subject granting  

priority to the blind handicapped for completing the backlog  

in the vacant fair price shops under the public distribution  

system in rural and urban area.  It is relevant to produce  

certain paragraphs of the said circular:-

“1.  Through Govt. order no. 2715/29-6-02-162- Sa/01 dated 17th August, 2012 for the allotment  of FPS shop for the implementation of reservation  has  been  issued  guidelines  and  for  the  reservation  of  FPS  shop  also  applied  the  Horizontal  arrangement.   Under  the  above  arrangement there is the provision to grant 2%  reservation  to  the  handicapped.   In  the  above  horizontal  there  was  no  clear  arrangement  for  

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blind handicapped persons. Vide Govt. order no.  311/29.06.08-162  SA/01  T.C.  dated  01  February, 2008 amending the above Govt. order  granted  one  percent  horizontal  reservation  to  handicapped blind person.

2. It came in the notice of the administration  that  in  regard  to  the  reservation  of  blind  handicapped persons  vide  Govt.  order  they  are  not getting the representation.  It is pertinent to  mention  here  that  in  the  entire  district  of  the  state  given  the  direction  on  the  administration  level to complete the quota of reservation.  The  administration  after  appropriate  consideration  has  taken  decision  till  then  backlog  cannot  completed  for  the  present  reservation  of  the  blind,  since  then  the  blind  person  should  be  granted first priority in the allotment of the shop,  in consideration they are fulfilling the prescribed  condition issued by the Govt for the allotment of  the shop.  In case that resident of gram Sabha,  who is entitled, the blind do not apply then the  resident  of  concern  Gram  Sabha  block  development  area,  other  blind  person  shall  be  entitled to apply.  In the allotment of FPS shop  under Public Distribution system on the basis of  total  shop  the  reservation  should  be  assessed.  Up  to  the  completion  of  blind  handicapped  should not furnish the shop from any category,  under the public distribution system in regard to  FPS shop time to time issued Govt order should  be treated amended up to this limit.”

[underling is ours]

13. Though, the narration of facts is reflective of a different  

contour of controversy. i.e., allotment and grant of licence  

for  a  fair  price  shop,  the  seminal  issue,  as  noted  

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hereinabove,  would  hinge  on  the  answer  to  the  question  

pertaining to right to assail the order passed in appeal.  The  

appellant was not impleaded as a party in the appeal but  

she  herself  got  impleaded.   Assuming  the  appellant  

authority would have decided the appeal in favour of  the  

original allottee in her absence, could the present appellant,  

a  subsequent  allottee  in  respect  of  the  same shop,  have  

been allowed in law to make a grievance by invoking the  

jurisdiction of  any statutory forum or for  that matter  the  

High  Court  under  Article  227  of  the  Constitution.   In  

essence, whether she is a necessary party to the litigation  

and entitled to contest the legal vulnerability of the order of  

cancellation or in any manner advance the plea that  her  

allotment would not be affected despite the factum that the  

order  of  cancellation  of  the  earlier  allottee  has  been  

quashed.   To appreciate the said issue we will dwell upon  

certain  authorities  though  they  may  pertain  to  different  

jurisprudence.   

14. First, it is necessary to understand about the concept  

of necessary and proper party.  A Four-judge Bench in Udit  

Narain  Singh Malpaharia v Additional Member Board  

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of Revenue, Bihar and another2 has observed thus:-  

“7.  ....it  would  be  convenient  at  the  outset  to  ascertain who are necessary or proper parties in  a  proceeding.   The law  on the  subject  is  well  settled:  it is enough if we state the principle.  A  necessary  party  is  one without  whom no order  can be made effectively; a proper party is one in  whose  absence  an  effective  order  can  be  made  but whose presence is necessary for a complete  and final decision on the question involved in this  proceeding. ”

15. In Vijay Kumar Kaul and others v. Union of India  

and others3  the court referred to the said decision and has  

opined thus:-  

“36.  Another  aspect  needs  to  be  highlighted.  Neither before the Tribunal nor before the High  Court,  Parveen Kumar and others were arrayed  as parties. There is no dispute over the factum  that they are senior to the appellants and have  been  conferred  the  benefit  of  promotion  to  the  higher posts. In their absence, if any direction is  issued for  fixation of  seniority,  that  is  likely  to  jeopardise  their  interest.  When  they  have  not  been impleaded as parties such a relief is difficult  to grant.

37. In this context we may refer with profit to the  decision in  Indu Shekhar Singh v. State of U.P.4  wherein it has been held thus: (SCC p. 151, para  56)

2 AIR 1963 SC 786 3 (2012) 7 SCC 610 4 (2006) 8 SCC 129

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“56. There is another aspect of the matter. The  appellants herein were not  joined as parties in  the writ petition filed by the respondents. In their  absence,  the  High  Court  could  not  have  determined the question of inter se seniority.”

38. In Public Service Commission v. Mamta Bisht5  this  Court  while  dealing  with  the  concept  of  necessary  parties  and  the  effect  of  non- impleadment of such a party in the matter when  the selection process is assailed observed thus:  (SCC pp. 207-08, paras 9-10)

“9.  …  in  Udit  Narain  Singh  Malpaharia  v.   Board  of  Revenue6,  wherein  the  Court  has  explained  the  distinction  between  necessary  party,  proper  party  and  proforma  party  and  further  held  that  if  a  person  who  is  likely  to  suffer from the order of  the court and has not  been impleaded as a party has a right to ignore  the said order as it has been passed in violation  of  the  principles  of  natural  justice.  More  so,  proviso to  Order  1 Rule  9 of  the Code of  Civil  Procedure,  1908  (hereinafter  called  ‘CPC’)  provides that non-joinder of necessary party be  fatal.  Undoubtedly,  provisions  of  CPC  are  not  applicable  in  writ  jurisdiction  by  virtue  of  the  provision of Section 141 CPC but the principles  enshrined  therein  are  applicable.  (Vide  Gulabchand Chhotalal Parikh v. State of Gujarat7,  Babubhai  Muljibhai  Patel  v.  Nandlal  Khodidas   Barot8 and Sarguja Transport Service v. STAT9.)

10.  In  Prabodh Verma v.  State  of  U.P.10 and  Tridip Kumar Dingal v. State of W.B.11, it has been  

5 (2010) 12 SCC 204 6 AIR 1965 SC 786 7 AIR 1965 SC 1153 8 (1974) 2 SCC 706 9 (1987) 1 SCC 5 10 (1984) 4 SCC 251 11 (2009) 1 SCC 768

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held  that  if  a  person  challenges  the  selection  process, successful candidates or at least some  of them are necessary parties.”

16. At this juncture, it is necessary to state that in  Udit  

Narain  (Supra)  question  arose  whether  a  tribunal  is  a  

necessary party.  Recently a two-Judge Bench in Asstt. G.M  

State Bank of India v. Radhey Shyam Pandey12 referred  

to  Hari  Vishnu Kamath v.  Ahmad Ishaque and Ors.13  

and adverted to the concept of a tribunal being a necessary  

party and in that context ruled that:-

“In  Hari  Vishnu  Kamath (supra),  the  larger  Bench was dealing with a case that arose from  Election Tribunal which had ceased to exist and  expressed the view how it is a proper party.  In  Udit Narain Singh (supra), the Court was really  dwelling upon the controversy with regard to the  impleadment  of  parties  in  whose  favour  orders  had  been passed  and in  that  context  observed  that tribunal is a necessary party.   In  Savitri  Devi (supra), the Court took exception to courts  and tribunals being made parties.  It is apposite  to note here that propositions laid down in each  case has to be understood in proper perspective.  Civil courts, which decide matters, are courts in  the strictest sense of the term.  Neither the court  nor the Presiding Officer defends the order before  the superior court it does not contest.  If the High  Court,  in  exercise  of  its  writ  jurisdiction  or  revisional jurisdiction, as the case may be, calls  for the records, the same can always be called for  by  the  High  court  without  the  Court  or  the  

12 2015 (3) SCALE 39 13 AIR 1955 SC 233

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Presiding  Officer  being  impleaded  as  a  party.  Similarly,  with  the  passage  of  time  there  have  been many a tribunal which only adjudicate and  they have nothing to do with the lis.  We may cite  few  examples;  the  tribunals  constituted  under  the  Administrative  Tribunals  Act,  1985,  the  Custom, Excise & Service Tax Appellate Tribunal,  the  Income  Tax  Appellate  Tribunals,  the  Sales  Tax  Tribunal  and  such  others.   Every  adjudicating authority may be nomenclatured as  a tribunal but the said authority(ies) are different  that  pure  and  simple  adjudicating  authorities  and that is why they are called the authorities.  An Income Tax Commissioner, whatever rank he  may be holding, when he adjudicates, he has to  be made a party, for he can defend his order.  He  is entitled to contest.  There are many authorities  under many a statute.  Therefore, the proposition  that  can  safely  be  culled  out  is  that  the  authorities  or  the  tribunals,  who  in  law  are  entitled to defend the orders passed by them, are  necessary parties and if they are not arrayed as  parties, the writ petition can be treated to be not  maintainable  or  the  court  may  grant  liberty  to  implead  them  as  parties  in  exercise  of  its  discretion.  There are tribunals which are not at  all required to defend their own order, and in that  case  such  tribunals  need  not  be  arrayed  as  parties.”  

The principle that has been culled out in the said case  

is  that  a  tribunal  or  authority  would  only  become  a  

necessary party which is entitled in law to defend the order.  

17. The term “entitled to defend” confers an inherent right  

to a person if he or she is affected or is likely to be affected  

by an order to be passed by any legal forum, for there would  

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be violation of natural justice.  The principle of audi alteram  

partem has its own sanctity but the said principle of natural  

justice  is  not  always  put  in  strait  jacket  formula.   That  

apart, a person or an authority must have a legal right or  

right in law to defend or assail.

18. We may first clarify that as a proposition of law it is  

not in dispute that natural justice is not an unruly horse.  

Its applicability has to be adjudged regard being had to the  

effect and impact of the order and the person who claims to  

be affected; and that is where the concept of necessary party  

become  significant.    In  The  General  Manager,  South  

Central Railway, Secunderabad and another v. A.V.R.   

Siddhantti and Others14 the Court was dealing with an  

issue  whether  the  private  respondent  therein  had  

approached  the  High  Court  under  Article  226  of  the  

Constitution for issue of a writ of mandamus directing the  

General Manager, South Central Railway and the Secretary,  

Railway  Board  to  fix  the  inter  se,  seniority   as  per  the  

original  proceedings,  dated  16.10.1952,  of  the  Railway  

Board and to further direct them not to give effect to the  

14 (1974) 4 SCC 335  

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subsequent proceedings dated 2.11.1957 and 13.01.1961 of  

the Board issued by way of “modification” and ‘clarification”  

of its earlier proceedings of 1952.  The High Court accepted  

the contentions of the private respondent and struck down  

the  impugned  proceedings.   A  contention  was  canvassed  

before this Court that the writ petitioners had not impleaded  

about 120 employees who were likely to be affected by the  

decision  and,  therefore,  there  being  non-impleadment  

despite  they  being  necessary  parties,  it  was  fatal  to  the  

decision.  Rejecting the said submission the court held:-  

“As regards the second objection, it is to be noted  that the decisions of the Railway Board impugned  in the writ petition contain administrative rules of  general  application,  regulating  absorption  in  permanent departments, fixation of seniority, pay  etc. of the employees of the erstwhile Grain Shop  Departments.  The  respondents-petitioners  are  impeaching the validity of those policy decisions  on the ground of their being violative of Articles  14 and 16 of the Constitution. The proceedings  are  analogous  to  those  in  which  the  constitutionality  of  a  statutory  rule  regulating  seniority  of  Government  servant  is  assailed.  In  such  proceedings  the  necessary  parties  to  be  impleaded are those against  whom the relief  is  sought,  and  in  whose  absence  no  effective  decision  can  be  rendered  by  the  Court.  In  the  present case, the relief is claimed only against the  Railway which has been impleaded through its  representative. No list or order fixing seniority of  the  petitioners  vis-a-vis  particular  individuals,  

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pursuant  to  the  impugned  decisions,  is  being  challenged. The employees who were likely to be  affected as a result of  the re-adjustment of  the  petitioner’s  seniority  in  accordance  with  the  principles  laid  down in  the  Board’s  decision of  October  16,  1952,  were,  at  the  most,  proper  parties and not necessary parties, and their non- joinder could not be fatal to the writ petition.”

19. The court further agreed with the principle stated in B.  

Gopalaiah and Ors v. Government of Andhra Pradesh15,  

J.S. Sachdev and Ors. v. Reserve Bank of India, New  

Delhi16 and Mohan Chandra Joshi v. Union of India and  

Ors.17   In this context reference to the authority in State of  

Himachal  Pradesh  and  another  v.  Kailash  Chand  

Mahajan and Others18 would be appropriate.  In the said  

case a contention was raised that non-impleadment of the  

necessary party was fatal to the writ petition.  In support of  

the said stand reliance was placed upon two decisions of  

two different  High Courts;  one,  State of  Kerala v.  Miss  

Rafia Rahim19 and the other in  Padamraj  v.  State of  

Bihar20.   The  Court  distinguished  both  the  decisions  by  

holding thus:-

15 AIR 1969 AP 204 16 ILR (1973) 2 Delhi 392 17 C.W. No. 650 of 1970, decided by Delhi High Court  18 1992 Supp (2) SCC 251 19 AIR 1978 Ker 176 20 AIR 1979 Pat 266

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“The  contention of  Mr  Shanti  Bhushan that  the  failure to implead Chauhan will be fatal to the writ  petition does not seem to be correct. He relies on  State of Kerala v.  Miss Rafia Rahim. That case re- lated to admission to medical college whereby in- validating the selection vitally affected those who  had  been  selected  already.  Equally,  the  case  Padamraj Samarendra v. State of Bihar, has no ap- plication.  This  was  a  case  where  the  plea  was  founded in Article 14 and arbitrary selection. The  selectees  were  vitally  affected.  The plea  that  the  decision of the court in the absence of Chauhan  would be violative of principle of natural justice as  any adverse decision would affect him is not cor- rect.”

The  Court  placed  reliance  on  A.  Janardhana v.  

Union of India21 and ultimately did not accept the submis-

sion that the writ petition was not maintainable because of  

non-impleadment of the necessary party.

20. In this context the authority in Sadananda Halo and  

Others  v.  Momtaz  Ali  Sheikh  and  Others22 is  quite  

pertinent.  The Division Bench referred to the decision in  

All India SC & ST Employees’ Assn. v. A. Arthur Jeen23  

wherein this court had addressed the necessity in joining  

21 (1983) 3 SCC 601 22 (2008) 4 SCC 619 23 (2001) 6 SCC 380

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Page 21

the necessary candidates as parties.  The Court referred to  

the  principle  of  natural  justice  as  enunciated in  Canara  

Bank v. Debasis Das24.   We may profitably reproduce the  

same:-  

“Natural justice has been variously defined. It is  another name for common sense justice. Rules of  natural justice are not codified canons. But they  are  principles  ingrained  into  the  conscience  of  man.  Natural  justice  is  the  administration  of  justice in a common sense liberal way. Justice is  based substantially on natural ideals and human  values.  The  administration  of  justice  is  to  be  freed  from  the  narrow  and  restricted  considerations which are usually associated with  a  formulated  law  involving  linguistic  technicalities and grammatical niceties. It is the  substance of justice which has to determine its  form. Principles of natural justice are those rules  which have been laid down by the courts as being  the  minimum  protection  of  the  rights  of  the  individual  against  the  arbitrary  procedure  that  may be adopted by a judicial, quasi-judicial and  administrative  authority  while  making an order  affecting those rights. These rules are intended to  prevent such authority from doing injustice.”

And again:-  

“Concept of natural justice has undergone a great  deal of change in recent years. Rules of natural  justice are not rules embodied always expressly  in a statute or in rules framed thereunder. They  may be implied from the nature of the duty to be  performed under a statute. What particular rule  of natural justice should be implied and what its  

24 (2003) 4 SCC 557

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context should be in a given case must depend to  a great extent on the facts and circumstances of  that  case,  the  framework  of  the  statute  under  which  the  enquiry  is  held.  The  old  distinction  between a judicial act and an administrative act  has withered away. The adherence to principles  of  natural  justice  as  recognised  by  all  civilised  States is of supreme importance….”

21. We  have  referred  to  the  aforesaid  passages  as  they  

state  the  basic  principle  behind  the  doctrine  of  natural  

justice, that is, no order should be passed behind the back  

of a person who is to be adversely affected by the order.  The  

principle behind proviso to Order I Rule 9 that the Code of  

Civil  Procedure  enjoins  it  and  the  said  principle  is  also  

applicable  to  the  writs.   An  unsuccessful  candidate  

challenging the selection as far as the service jurisprudence  

is  concerned  is  bound  to  make  the  selected  candidates  

parties.  

22. In J.S. Yadav Vs State of U.P. & Anr25 in Paragraph  

31 it has been held thus:-

“No order  can be passed behind the  back of  a  person adversely affecting him and such an order  if passed, is liable to be ignored being not binding  on such a party as the same has been passed in  violation of the principles of natural justice.  The  principles  enshrined  in  the  proviso  to  Order  1  

25 (2011) 6 SCC 570

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Page 23

Rule  9  of  the  Code  of  Civil  Procedure,  1908  provide that impleadment of a necessary party is  mandatory  and  in  case  of  non-joinder  of  necessary party, the petitioner-plaintiff  may not  be  entitled  for  the  relief  sought  by  him.  The  litigant has to ensure that the necessary party is  before the court, be it a plaintiff or a defendant,  otherwise  the  proceedings  will  have  to  fail.  In  service  jurisprudence  if  an  unsuccessful  candidate challenges the selection process, he is  bound to implead at least some of the successful  candidates  in  representative  capacity.   In  case  the  services  of  a  person  are  terminated  and  another person is appointed at his place, in order  to get relief, the person appointed at his place is  the necessary party for the reason that even if the  petitioner-plaintiff  succeeds,  it  may  not  be  possible  for  the  Court  to  issue  direction  to  accommodate the petitioner without removing the  person  who  filled  up  the  post  manned  by  the  petitioner-plaintiff. (Vide Prabodh Verma V. State  of  U.P,  Ishwar  Singh  Vs.  Kuldip  Singh,  Tridip  Kumar Dingal Vs. State of W.B, State of Assam V.  Union of India and Public Service Commission V.  Mamta  Bisht).  More  so,  the  public  exchequer  cannot be burdened with the liability to pay the  salary  of  two  persons  against  one  sanctioned  post”.

23. To appreciate the said decision in a real perspective, it  

is absolutely necessary to state the facts under which the  

decision was  rendered  and such a  statement  of  law was  

made.  The issue that arose before this Court related to an  

order passed by the High Court of  Allahabad by which it  

had  dismissed  the  writ  petition  filed  by  the  appellant  

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Page 24

challenging the notification dated 28.05.2008 by which on  

the date of constitution of the Uttar Pradesh State Human  

Rights Commission, the appellant was declared to cease to  

hold the office as a member of the said commission.  This  

Court noted the facts which were relevant and germane for  

the disposal of the appeal in paragraph 2.  The appellant  

therein was appointed as a member of the Commission on  

29.06.06 for a period of five years. Certain provisions of the  

Protection of Human Rights Act 1993, stood amended vide  

the  Protection  of  Human  Rights  (Amendment  Act,  2006)  

which came into force on 23.11.2006.  After completion of  

the  tenure  by  Chairperson  of  the  Commission  and other  

members in October 2007, the appellant remained the lone  

working member of the Commission.  The State Government  

issued the notification on 28.05.2008 to the effect that the  

appellant had ceased to hold the office as a Member of the  

Commission.  The said notification was challenged on the  

ground that he had been appointed for a tenure of five years  

and that period could not be curtailed.  The appellant had  

not impleaded any of the members who had been appointed  

as  members  on  06.06.2008.    Various  contentions  were  

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raised on behalf of the appellant and the said submissions  

were resisted by the State on two counts, namely, that the  

appellant had not impleaded the newly appointed members  

as  parties  and  further  he  had  suffered  the  disability  by  

virtue  of  the  operation  of  the  amended  law.   This  court  

referred to the provision contained in unamended Section  

21(2) of the Act and the Amended Section 21(2) of the Act.  

Prior  to  the  amendment,  the  qualification  prescribed  for  

Member was “a person who is or has been a District Judge  

in that State” and after the amendment the qualification of  

the member was changed to the extent “he is or has been a  

Judge of a High Court or District Judge in the State with a  

minimum of 7 years experience as a District Judge”.  The  

court  referred  to  Article  236(a)  of  the  Constitution  and  

Section 3(17) of the General Clauses Act, 1897.  Be it stated,  

the contention was advanced that a person who has gained  

experience  as  an  Additional  District  Judge,  he  would  be  

entitled for consideration as his experience is equivalent to  

that of a District Judge.  Repelling the said submission, the  

Court held:-

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Page 26

“12. The aforesaid submission seems to be very  attractive  but  has  no substance  for  the reason  that a cadre generally denotes a strength of a ser- vice or a part of service sanctioned as a separate  unit.  It  also  includes  sanctioned  strength  with  reference to grades in a particular service. Cadre  may also include temporary, supernumerary and  shadow posts created in different grades. The ex- pressions “cadre”, “posts” and “service” cannot be  equated with each other.  (See  Union of  India v.  Pushpa Rani and State of Karnataka v. K. Govin- dappa26.) There is no prohibition in law to have  two or more separate grades in the same cadre  based  on  an  intelligent  differential.  Admittedly,  the post of District Judge and Additional District  Judge in the State of U.P. is neither interchange- able  nor  intertransferable.  The  aforesaid  Rules  merely  provide  for  an  integrated  cadre  for  the  aforesaid posts. Thus, the submission is liable to  be rejected being preposterous.

xxx xxx xxx

14. In such a fact situation, we do not see any co- gent reason to take a view contrary to the same  for the reason that in case the legislature in its  wisdom has prescribed a minimum experience of  seven years as a District Judge knowing it fully  well the existing statutory and constitutional pro- visions, it does not require to be interpreted ig- noring the legislative intent. We cannot proceed  with an assumption that legislature had commit- ted  any  mistake  enacting  the  said  provision.  Clear  statutory  provision in such a  case  is  re- quired to be literally construed by considering the  legislative  policy.  Thus,  no  fault  can  be  found  with  the  impugned  judgment  and  order  of  the  High Court on this count.”

26  (2009) 1 SCC 1

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Page 27

24. After  so stating,  the Court noted the fact  that  2006  

amendment  was  not  under  challenge.   However,  it  noted  

that  the  issue  agitated  by  the  appellant  was  that  the  

legislature never intended to apply the amended provisions  

with  retrospective  effect  and,  therefore,  it  could  not  be  

discontinued from the post, for his rights stood protected by  

the provisions of Section 6 of the General Clauses Act. The  

Court  referred  to  the  authorities  in  State  of  Punjab  v.  

Bhajan  Kaur27,  Sangam  Spinners  v.  Regl.  Provident  

Fund  Commr.28,  and  Railway  Board  v.  C.R.  

Rangadhamaiah29 and held as follows:-

“Thus, from the above, it is evident that accrued  rights  cannot  be  taken  away  by  repealing  the  statutory provisions arbitrarily. More so, the re- pealing law must provide for  taking away such  rights, expressly or by necessary implication.”

25. Thereafter,  the  Court  proceeded  to  lay  down  as  

follows:-

“There is  no specific  word in the 2006 Amend- ment Act to suggest its retrospective applicability.  Rather the positive provisions of Section 1 sug- gest to the contrary as it reads:-

“1. Short title and commencement.—(1)   *** 27  (2008) 12 SCC 112 28  (2008) 1 SCC 391 29  (1997) 6 SCC 623

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(2) It shall come into force on such date as the  Central Government may, by notification in the  Official Gazette, appoint.”

Undoubtedly, the amended provisions came into  force  on  23-11-2006 vide  S.O.  2002 (E),  dated  23-11-2006,  published  in  the  Gazette  of  India,  Extra  Pt.  II,  Section  3(ii)  dated  23-11-2006.  In  fact, the date 23-11-2006 is the pointer and puts  the  matter  beyond doubt.  Thus,  in  view of  the  above, we do not have any hesitation to declare  that the Notification dated 28-5-2008 is patently  illegal.”

26. After so stating, in paragraph 32 of the judgment, the  

Court held thus:-

“The appellant did not implead any person who  had been appointed in his place as a Member of  the Commission. More so, he made it clear before  the  High Court  that  his  cause  would be  vindi- cated if the Court made a declaration that he had  illegally been dislodged/restrained to continue as  a  Member  of  the  Commission.  In  view  of  the  above, he cannot be entitled to any other relief  except  the declaration in his  favour which had  been made hereinabove that the impugned Notifi- cation dated 28-5-2008 is illegal.”

27. On a keen understanding of  the aforesaid authority,  

two aspects are clear.  First, it had noted the fact what was  

pleaded before the High Court that the selected members  

were not arrayed as parties.  Thereafter, it had proceeded to  

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deal with the distinction between a District Judge and an  

Additional District Judge, that is, for the purpose of meeting  

the qualification under the amended Act.  Thereafter, as is  

manifest,  it  proceeded  to  analyse  the  retrospective  

applicability of the amended provision and opined that the  

provision  is  not  retrospectively  applicable  and,  therefore,  

notification is  bad in law.   Paragraph 31 of  the  decision  

proceeded  to  state  that  unless  necessary  parties  are  

arrayed, no relief can be granted.  Irrefragably, there can be  

no cavil  over the said proposition of  law.  Thereafter,  the  

Division Bench proceeded to state that in case the services  

of a person are terminated and another person is appointed  

in his place, in order to get the relief, the person appointed  

at his place is the necessary party for the reason that even if  

the petitioner succeeds, it may not be possible for the Court  

to issue a direction to accommodate the petitioner without  

removing the person who filled up the post manned by the  

petitioner.  To arrive at the said conclusion, five authorities  

have been relied upon.  We shall discuss at length the said  

decisions.  

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Page 30

28. We shall deal with the authorities in seriatim.  A three-

judge Bench decision in  Prabodh Verma and Others v.   

State  of  Uttar  Pradesh  and  Others30 requires  to  be  

addressed.  The facts in the said case deserved to be stated.  

In  the  said  case  the  principal  question  that  arose  for  

determination  before  this  Court  was  the  constitutional  

validity of two Uttar Pradesh Ordinances, namely, (1) The  

Uttar  Pradesh  High  Schools  and  Intermediate  Colleges  

(Reserve Pool Teachers) Ordinance, 1978 (U.P. Ordinance 10  

of  1978),  and  (2)  The  Uttar  Pradesh  High  Schools  and  

Intermediate  Colleges  Reserve  Pool  Teachers)  (Second)  

Ordinance,  1978 (U.P.  Ordinance 22 of  1978).   The High  

Court on certain reasons had struck down the ordinance.  

Be it noted, the writ petition was filed by the Uttar Pradesh  

Madhyamik Shikshak Sangh.  Apart from the question of  

validity, the subsidiary question that arose before this Court  

is whether the termination of the services of the appellants  

and  the  petitioner  before  this  Court  as  secondary  school  

teachers and intermediate college lecturers following upon  

the High Court judgment is valid and, if not, the relief to  

30 (1984) 4 SCC 251

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Page 31

which they are entitled.  After narrating the facts, the Court  

observed that the writ petition filed by the Sangh suffered  

from two serious, though not incurable, defects. We think it  

appropriate  to  reproduce  the  statement  of  facts  as  

reproduced in the judgment.   

“The first defect was that of non-joinder of neces- sary parties. The only respondents to the Sangh’s  petition were the State of Uttar Pradesh and its  concerned officers.  Those who were vitally  con- cerned, namely, the reserve pool teachers, were  not made parties — not even by joining some of  them  in  a  representative  capacity,  considering  that their number was too large for all of them to  be joined individually as respondents. The mat- ter,  therefore,  came  to  be  decided  in  their  ab- sence. A High Court ought not to decide a writ  petition  under  Article  226  of  the  Constitution  without the persons who would be vitally affected  by its judgment being before it as respondents or  at least by some of them being before it  as re- spondents  in  a  representative  capacity  if  their  number  is  too  large,  and,  therefore,  the  Alla- habad High Court ought not to have proceeded to  hear  and  dispose  of  the  Sangh’s  writ  petition  without insisting upon the reserve pool teachers  being made respondents to that writ petition, or  at least some of them being made respondents in  a representative capacity, and had the petitioners  refused to do so,  ought to have dismissed that  petition for non-joinder of necessary parties.”

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Page 32

29. Thereafter  the  Court  proceeded  to  summarise  its  

conclusion  and  the  relevant  conclusion  for  the  present  

purpose are reproduced below:-

“50  (1)   A  High  Court  ought  not  to  hear  and  dispose of a writ petition under Article 226 of the  Constitution without the persons who would be  vitally affected by its judgment being before it as  respondents  or  at  least  some  of  them  being  before  it  as  respondents  in  a  representative  capacity if their number is too large to join them  as  respondents  individually,  and,  if  the  petitioners refuse to so join, then the High Court  ought to dismiss the petition for non-joinder of  necessary parties.

(2) The Allahabad High Court ought not to have  proceeded to hear and dispose of Civil Miscella- neous Writ  No.  9174 of  1978 —  Uttar Pradesh  Madhyamik  Shikshak  Sangh v.  State  of  Uttar  Pradesh —  without  insisting  upon  the  reserve  pool  teachers  being  made  respondents  to  that  writ petition or at least some of them being made  respondents thereto in a representative capacity  as the number of the reserve pool teachers was  too large and, had the petitioners refused to do  so, to dismiss that writ petition for non-joinder of  necessary parties.”

 30. On a studied perusal of the aforesaid judgment, it is  

crystal  clear  that  this  Court  had  opined  that  when  the  

constitutional validity of a provision is challenged and there  

are beneficiaries of  the said provision, some of them in a  

representative  capacity  have  to  be  made  parties  failing  

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which the writ court would not be justified in hearing a writ  

petition in the absence of the selected candidates when they  

are already appointed on the basis of the provision which  

was under assail before the writ court.  

31. In  Ishwar  Singh  v  Kuldip  Singh  and  others31, a  

two-Judge Bench was dealing with the situation where the  

selection and consequent appointments were challenged by  

unsuccessful candidates before the High Court primarily on  

the ground that the interviews held for the said selection  

were  a  sham  affair.   The  High  Court  had  quashed  the  

selection and the appointments on the foundation that the  

interviews held were neither fair nor proper thereby vitiating  

the selection.  This Court dislodged the order of the High  

Court on a singular count which is to the following effect: -

“It is not disputed by the learned counsel for the  parties  that  except  Ishwar  Singh,  no  other  selected candidate was impleaded before the High  Court.   The selection and the appointments have  been quashed entirely at their back.  It is further  stated that even Ishwar Singh, one of the selected  candidates,  who  was  a  party,   had  not  been  served and as such was not heard by the High  Court.  We are of the view that the High Court  was not justified in hearing the writ petition in  the absence of the selected candidates especially  when they had already been appointed.”

31 1995 Supp (1) SCC 179

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32. The decision in the aforesaid case is graphically clear  

that  the  selection  was  under  challenge  but  the  selectees  

were not made parties.  There can be no shadow of doubt  

that they were necessary parties and, therefore, this Court  

expressed the view, which we have reproduced hereinabove.  

33. In Tridip Kumar Dingal and other v. State of West  

Bengal  and  Others32 an  appeal  was  preferred  by  the  

appellants  being  aggrieved  and  dissatisfied  with  the  

judgment and order passed by the High Court of Calcutta.  

The facts giving rise to the appeal by special leave before  

this  Court  were  that  the  State  of  West  Bengal  in  the  

Department of Health and Family Welfare taking note of the  

acute shortage and non-availability of adequate number of  

Medical  Technologists,  took  an  initiative  to  fill  up  the  

requisite number of vacancies by taking up the matter with  

Employment Exchange.  A Memorandum was issued by the  

Assistant Director of Health Services (Administration) to the  

Director of Employment Exchange for sponsoring the names  

of  candidates  for  the  post  of  Medical  Technologists.  

Eventually, on the basis of the marks obtained in the oral  32 (2009) 1 SCC 768

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interview, a list was prepared.  The candidates who could  

not get entry into the select list challenged the same before  

the  West  Bengal  Administrative  Tribunal.   The  tribunal  

granted liberty to the authorities to make appointments of  

the candidates selected and empanelled subject to the result  

in  the Original  Application.   The matter  at  various times  

travelled to the High Court, which directed for disposal of  

the Original Application.  Eventually, the tribunal directed  

for preparation of the fresh merit list on the basis of marks  

obtained  in  the  written  examination  and  oral  interview  

excluding those who were already in service.  The tribunal  

also observed that the Committee had fixed 40% as pass  

marks in the oral interview and the said standard should be  

applied on the total marks as pass marks and appointment  

should be given from the fresh panel so prepared in order of  

merit subject to reservation and filling up of vacant posts.  

The decision of the tribunal was challenged before the High  

Court  and  the  High  Court  opined  that  the  question  of  

retaining those candidates who had been appointed must be  

considered afresh by the tribunal since the tribunal had not  

assigned any reason as to why they should be permitted to  

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be continued in service.  The High Court had expressed the  

view  that  no  sympathy  should  have  been  shown  to  the  

candidates  when  the  tribunal  itself  had  expressed  the  

opinion  that  the  selection  process  was  vitiated.   Various  

other reasons were also ascribed by the High Court.  After  

remit,  the  tribunal  considering  the  rivalised  submissions  

and  taking  an  overall  view  of  the  matter  found  that  the  

selection process was bona fide and in accordance with law  

and,  therefore,  it  requires  to  be  approved.   The  tribunal  

further  held  that  appointments  which  had  already  been  

made by the authorities in respect of 190 candidates who  

had gained experience of more than three years of work of  

investigation entrusted to them should not be disturbed.  A  

direction  was  issued  to  the  State  authorities  to  offer  

appointments  to  successful  candidates in  the  waiting  list  

subject  to  the  availability  of  vacancies  following  medical  

examination and police verification.  The said judgment was  

challenged before the High Court which set aside the order  

of  the  tribunal  and  directed  a  fresh  panel  of  Medical  

Technologists to be prepared by the State Government on  

the  basis  of  the  qualifying  marks  obtained  both  in  the  

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written  test  as  well  as  in  the  oral  interview.   Certain  

directions were given by the High Court including the one if  

those candidates who had already been appointed did not  

find place in the panel, consequential orders would be made  

by the State Government but those who were in the panel  

were accommodated if by reason of existing vacancies, they  

should  be  accommodated.    The  said  order  became  the  

subject matter of special leave petition which was dismissed  

as  withdrawn.   As  the  order  of  the  High  Court  was  not  

implemented,  a  contempt  petition  was  filed.   An  

unconditional  apology  was  offered  on  behalf  of  the  

contemners stating that they were ready and willing to carry  

out the directions.  At that juncture, the High Court passed  

an interim order to the extent that Court was not inclined to  

issue any direction for removal/termination of services of 66  

persons who were working since three to four years.  The  

Court  also  directed  the  State  to  report  to  the  Court  as  

regards the exact number of vacancies which were available  

for  the  appointment  of  the  panel  to  be  prepared  and  to  

inform whether nine vacancies which had become defunct  

could be revived.  When the matter was placed again on the  

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next  date,  the  High  Court  noted  that  a  panel  of  586  

candidates, had been prepared on the basis of 40% marks  

obtained by candidates both in the written test as well as in  

the oral interview.  It also observed that 66 persons who had  

been appointed could be accommodated by granting liberty  

to  the  State  Government  in  the  manner  it  thought  best  

without disturbing their seniority or continuity of service.  It  

further directed that remaining vacancies should be filled  

up on the basis of seniority position from the panel of 586  

candidates.   With  the  aforesaid  directions,  the  contempt  

petition was disposed of  and the  said order  was assailed  

before this Court.  After hearing the learned counsel for the  

parties,  this  Court  came  to  hold  that  the  contention  on  

behalf  of  the  State  Government  that  written  examination  

was  held  for  shortlisting  the  candidates  and  was  in  the  

nature of elimination test had no doubt substance, for the  

said authorities  regard being had to the large number of  

applicants  seeking  appointment  and  small  number  of  

vacancies, had no other option but to screen candidates by  

holding a written examination more so, when there were no  

rules in that regard.   This Court further opined that it was  

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an administrative decision and such a plea was raised by  

the State in the first round of litigation before the tribunal  

which had held that the action of State authorities to be  

wrong  and  the  High  Court  upheld  it  and  State  did  not  

challenge the order before this Court and, therefore, in the  

second round the High Court did not commit any error of  

law in directing the authorities to prepare merit list on the  

basis  of  marks  obtained  by  the  candidates  in  written  

examination as also in oral interview.  It was further held  

that  in  such  a  situation  it  was  not  open  to  the  State  

authorities to reiterate and reagitate the same ground on  

the same occasion.  A contention was raised on behalf of the  

appellant that there cannot be more than 15% marks at the  

oral interview, which was not accepted by this Court at that  

stage, for such a direction was issued as early as in 2000  

and the appellants were applicants before the Tribunal and  

the petitioners before the High Court had accepted the said  

decision  and  did  not  challenge  the  legality  thereof  by  

approaching this Court.  Thereafter, the Court proceeded to  

deal  with the 66 candidates.   In that  context  it  ruled as  

follows:-  

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“Regarding protection granted to 66 candidates,  from the record it is clear that their names were  sponsored by the employment exchange and they  were selected and appointed in 1998-1999. The  candidates  who  were  unable  to  get  themselves  selected and who raised a grievance and made a  complaint  before  the  Tribunal  by  filing  applications ought to have joined them (selected  candidates)  as  respondents  in  the  original  application,  which  was  not  done.  In  any  case,  some  of  them  ought  to  have  been  arrayed  as  respondents in a “representative capacity”. That  was also not done. The Tribunal was, therefore,  wholly right in holding that in absence of selected  and appointed candidates and without affording  opportunity  of  hearing  to  them,  their  selection  could not be set aside.”  

[Emphasis added]

34. We  have  referred  to  the  said  authority  in  a  

comprehensive manner to understand the ratio.  It is quite  

simple.  If a non-selected candidate challenges the selection,  

he  is  under  legal  obligation  to  implead  the  selected  

candidates as they are necessary parties and there can be  

no two opinions as regards such a proposition of law.  

35. In  State of Assam v. Union of India and Others33  

the State of Assam, being aggrieved by the decision rendered  

in writ appeal and the dismissal of the review application  

filed by it, had approached this Court.  The factual matrix  

33 (2010) 10 SCC 408

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as was presented before the Court was that Union of India  

had introduced “Family Welfare Scheme” under its Family  

Planning Programme and under the said Scheme, there was  

a provision for appointment of Voluntary Female Attendants  

on a monthly honorarium of Rs.50/- per month from the  

inception of the Scheme which was subsequently increased  

to  Rs.100/-  per  month,  w.e.f.   February,  2001.   As  the  

factual  narration  would  show  a  writ  petition  was  filed  

claiming benefit from the respondents of the pay of Rs.900/-  

per month,  the minimum of the pay scale payable to the  

Voluntary Female Attendants.  A prayer was also made for  

regularisation.  A direction was given by the High Court that  

it was for the State Government to consider the prayers in  

accordance with law.  A similar writ was filed by another  

female attendant wherein the Union of India and the State  

of Assam were arrayed as respondents and the High Court  

disposed of the writ petition relying on the earlier judgment.  

The Union of India being aggrieved preferred a writ appeal in  

which it did not implead the State of Assam as a party to  

those proceedings.  The contention of the Union of India was  

that  the  voluntary  female  attendants  were  not  their  

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employees and, therefore, the Single Judge was not correct  

in  issuing direction to  the  Union of  India  for  payment  of  

minimum pay scale.  It was urged that the State of Assam  

had  issued  appointment  letters  to  the  said  female  

attendants.   There was no mention in those appointment  

letters  that  they  were  appointed  under  the  centrally  

sponsored scheme.  A prayer was made to discharge them of  

their  liability  of  any  payment  of  wages  to  the  private  

respondents  appointed  by  the  State  Government.   The  

Division Bench accepted the stand of the Union of India and  

held that the appointment letters had nothing to link them  

with the centrally sponsored scheme of voluntary workers at  

fixed honorarium.  On the basis of the aforesaid analysis,  

the Division Bench observed that the Union of India had no  

responsibility of  making the payment on the minimum of  

the pay scale to the voluntary female attendants, and fixed  

the liability  on the State  of  Assam.  Being aggrieved,  the  

State of Assam had preferred the appeal by special leave.  

The  two-Judge  Bench  referred  to  the  decision  in  Udit  

Narain (supra) and opined thus:-

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“15. In aid of his submission, the learned Senior  Counsel has placed reliance on the law laid down  by this Court in Udit Narain Singh Malpaharia v.  Board  of  Revenue,  wherein  it  was  held  that  in  proceedings for a writ of certiorari, it is not only  the tribunal or authority whose order is sought to  be quashed but also the parties in whose favour  the  said  order  is  issued,  are  necessary  parties  and that it is in the discretion of the court to add  or implead proper parties for completely settling  all the questions that may be involved in the con- troversy either suo motu or on the application of  a party to the writ or on application filed at the  instance of such proper party.

16. We respectfully agree with the observations  made by this Court in Udit Narain case and adopt  the same. We may add that the law is now well  settled  that  a  necessary  party  is  one  without  whom, no order  can be made effectively  and a  proper party is one in whose absence an effective  order can be made but whose presence is neces- sary for a complete and final decision of the ques- tion involved in the proceeding.

xxx xxx xxx

23. We are also unable to comprehend any possi- ble  reasons  for  the  Union of  India  to  omit  the  State of Assam from the array of parties in the  writ appeals filed before the Division Bench of the  High Court. The fact remains that they were not  made parties to the proceedings. The High Court,  in our view, while allowing the appeals filed by  the  Union  of  India  and  shifting  the  liability  of  payment of salary/wages to the Voluntary Female  Attendants on the State of Assam, should have  taken a little more care and caution to find out  whether the State of Assam is arrayed as a party  to the proceedings and whether they are served  

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with the notice of the appeals and in spite of ser- vice, whether they have remained absent. This is  the least that is expected from the Court. Without  making this small verification, the Division Bench  of the High Court has fixed huge recurring finan- cial  liability  on  the  State  Government.  In  our  opinion, in matters of this nature, even by mis- take of the party, the proper parties were not ar- rayed  in  the  proceedings,  it  is  the  duty  of  the  Court  to  see  that  the  parties  are  properly  im- pleaded.  It  is  well-settled  principle  consistent  with  natural  justice  that  if  some  persons  are  likely to be affected on account of setting aside a  decision  enuring  to  their  benefit,  the  Court  should not embark upon the consideration and  the correctness of such decision in the absence of  such persons.”

36. The proposition of  law stated hereinabove has to be  

understood in proper perspective.  There were two prayers  

in the writ petition. One was for payment of salary, the other  

was  for  regularisation.   Ultimately,  the  Division  Bench  

absolved the Union of India from liability of payment and  

fastened it on the State.  The State was not arrayed as a  

party to the lis.  That was an accepted fact.  Needless to  

emphasise the State of Assam was a necessary party and  

more so when the Union of India was taking the stand that  

it was the State of Assam which had to bear the liability.  

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The  State  of  Assam was  entitled  to  resist  the  stand and  

stance put forth by the Union of India in law.  

37. In  Public  Service  Commission,  Uttranchal  v.  

Mamta Bisht  and Others34 it  was  held  by  a  two-Judge  

Bench that the first respondent therein wanted her selection  

against a reserved category vacancy and, therefore, the last  

selected candidate in that category was a necessary party  

and without impleading her the writ petition could not have  

been  entertained  by  the  High  Court,  for  if  a  person  

challenges a selection process, successful candidates or at  

least some of them are to be arrayed as parties they being  

necessary parties.  To appreciate the controversy, we must  

reproduce two paragraphs from the said authority:-

“9. In case Respondent 1 wanted her selection  against  the  reserved  category  vacancy,  the  last  selected candidate in that category was a neces- sary party and without impleading her, the writ  petition could not have been entertained by the  High Court in view of the law laid down by nearly  a Constitution Bench of this Court in Udit Narain  Singh Malpaharia v.  Board of  Revenue,  wherein  the Court has explained the distinction between  necessary  party,  proper  party  and  pro  forma  party  and further  held  that  if  a  person who is  likely to suffer from the order of  the court and  has not been impleaded as a party has a right to  ignore the said order as it has been passed in vio-

34 (2010) 12 SCC 204

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lation of  the principles  of  natural  justice.  More  so, proviso to Order 1, Rule 9 of the Code of Civil  Procedure,  1908 (hereinafter  called  “CPC”)  pro- vides that non-joinder of necessary party be fatal.  Undoubtedly, provisions of CPC are not applica- ble in writ jurisdiction by virtue of the provision  of Section 141 CPC but the principles enshrined  therein are applicable. (Vide Gulabchand Chhota- lal Parikh v. State of Gujarat, Babubhai Muljibhai   Patel v.  Nandlal  Khodidas  Barot35 and  Sarguja  Transport Service v. STAT36.)

10. In Prabodh Verma v.  State of U.P. and Tridip  Kumar Dingal v.  State of W.B., it has been held  that if a person challenges the selection process,  successful  candidates or at  least some of  them  are necessary parties.”

38. The said decision, as we understand, clearly spells out  

that in the absence of  a necessary party, no adjudication  

can take place and, in fact, the non-joinder would be fatal to  

the case.   

39. The  aforesaid  decisions  do  not  lay  down  as  a  

proposition of law that in every case when a termination is  

challenged,  the  affected  person  has  to  be  made  a  party.  

What has been stated is when one challenges a provision as  

ultra vires the persons who are likely to be affected, some of  

them should be made parties in a representative capacity.  

That has been the consistent view of this Court in service  35  (1974) 2 SCC 706 36  (1987) 1 SCC 5

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jurisprudence.   Some  other  decisions,  which  have  been  

relied  upon  are  directly  connected  with  regard  to  the  

selection and selectees.  On a perusal of the analysis made  

in  J.S. Yadav (supra),  we are disposed to think that the  

Court  has  applied  the  principle  pertaining  to  the  

constitutional validity by equating it with the interpretation  

of  a  provision,  whether  it  is  retrospective  or  prospective.  

That apart, the Court, as is evident from paragraph 32 of  

the  judgment,  has  noted  that  the  prayer  made  by  the  

appellant only related to the declaratory relief.    The said  

decision has to be understood in the context.  A ratio of a  

decision has to be understood in its  own context,  regard  

being  had  to  the  factual  exposition.   If  there  has  been  

advertence  to  precedents,  the  same  has  to  be  seen  to  

understand and appreciate the true ratio.  The ratiocination  

in  the  said  decision  is  basically  founded  on  the  

interpretation  of  the  statutory  provision  and  the  relief  

claimed.  The Court has been guided by the fact that when  

the  interpretation  as  regards  the  provision  whether  it  is  

retrospective  or  prospective,  the  selected  members  are  

necessary parties.   

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40. In this regard, we may refer to the rule stated by Lord  

Halsbury in Quinn v. Leathem37:-

“Every judgment must be read as applicable to  the  particular  facts  proved  or  assumed  to  be  proved,  since  the  generality  of  the  expressions  which may be found there are not intended to be  expositions of the whole law but govern and are  qualified  by  the  particular  facts  of  the  case  in  which such expressions are to be found.”

41. A three-Judge Bench in Union of India and others v.   

Dhanwanti Devi and others38 while discussing about the  

precedent under Article 141 of the Constitution, held that:-

“9. Before adverting to and considering whether  solatium and interest would be payable under the  Act, at the outset, we will dispose of the objection  raised by Shri  Vaidyanathan that  Hari  Krishan  Khosla case39 is not a binding precedent nor does  it operate as  ratio decidendi to be followed as a  precedent and is per se per incuriam. It is not ev- erything said by a Judge while giving judgment  that constitutes a precedent. The only thing in a  Judge’s decision binding a party is the principle  upon which the case is decided and for this rea- son it is important to analyse a decision and iso- late from it the  ratio decidendi. According to the  well-settled theory of  precedents, every decision  contains  three  basic  postulates—(i)  findings  of  material facts, direct and inferential. An inferen- tial  finding  of  facts  is  the  inference  which  the  Judge draws from the direct, or perceptible facts;  (ii) statements of the principles of law applicable  to the legal problems disclosed by the facts; and  

37  (1901) AC 495, p. 506 38  (1996) 6 SCC 44 39  1993 Supp (2) SCC 149

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(iii) judgment based on the combined effect of the  above. A decision is only an authority for what it  actually decides. What is of the essence in a deci- sion is its ratio and not every observation found  therein nor what logically follows from the vari- ous  observations  made  in  the  judgment.  Every  judgment must be read as applicable to the par- ticular  facts  proved,  or  assumed  to  be  proved,  since the generality of the expressions which may  be found there is not intended to be exposition of  the whole law, but governed and qualified by the  particular facts of the case in which such expres- sions are to be found. It would, therefore, be not  profitable  to  extract  a  sentence  here  and there  from the judgment and to build upon it because  the essence of the decision is its ratio and not ev- ery observation found therein. The enunciation of  the reason or principle on which a question be- fore a court has been decided is alone binding as  a precedent. The concrete decision alone is bind- ing between the parties to it, but it is the abstract  ratio decidendi, ascertained on a consideration of  the judgment in relation to the subject-matter of  the decision, which alone has the force of law and  which, when it is clear what it was, is binding. It  is only the principle laid down in the judgment  that is binding law under Article 141 of the Con- stitution. A deliberate judicial decision arrived at  after hearing an argument on a question which  arises in the case or is put in issue may consti- tute a precedent, no matter for what reason, and  the  precedent  by  long  recognition  may  mature  into rule of stare decisis. It is the rule deductible  from the application of law to the facts and cir- cumstances of the case which constitutes its  ra- tio decidendi.

10. Therefore, in order to understand and appre- ciate the binding force of a decision it is always  necessary to see what were the facts in the case  in which the decision was given and what was  

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the point which had to be decided. No judgment  can  be  read  as  if  it  is  a  statute.  A  word  or  a  clause or a sentence in the judgment cannot be  regarded as a full exposition of law. Law cannot  afford to be static  and therefore,  Judges are to  employ  an  intelligent  technique  in  the  use  of  precedents......”

42. From the aforesaid, it  is clear as day that what has  

been  stated  in  paragraph  31  in  the  case  of  J.S.  Yadav  

(supra) does not even follow from the authorities referred to  

therein.   We have analysed the principle  of  when and in  

what  circumstances,  a  decision  becomes  a  binding  

precedent.   We  have  also  discussed  the  facts  at  length  

keeping  in  view  the  declaratory  relief  made  in  the  writ  

petition preferred before  the  High Court.   The context  in  

which the observations have been made have to be kept in  

mind.  Regard being had to the factual scenario in entirety  

and  further  taking  note  of  the  fact  that  the  court  was  

basically concerned with the retrospective and prospective  

applicability of the provision, we are disposed to think that  

it is not a binding precedent for the proposition that in a  

case  of  termination  or  removal  or  dismissal,  the  person  

appointed  in  the  place  of  a  terminated,  removed  or  

dismissed employee would be a necessary party.   That is  

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how the said authority  has to be understood,  and we so  

understand.   

43. It has been held in Debasis Das (supra), the principles  

of natural justice are to be determined in the context and it  

must  depend  to  a  great  extent  on  the  facts  and  

circumstances of that case.  In this context, the decision in  

Kailash  Chand  Mahajan (supra)  becomes  extremely  

apposite.  May it be noted, we have already referred to the  

said  judgment  but  a  detailed  analysis  is  necessary  to  

understand the present controversy.  In the said case, the  

first  respondent,  after his retirement,  was appointed as a  

Member  of  the  Himachal  Pradesh  State  Electricity  Board  

and thereafter as the Chairman of the said Board.  He was  

granted extensions from time to time.  The last extension  

was issued on June 12, 1989 for a period of three years i.e.,  

July 25, 1992.  After the General Elections to the Legislative  

Assembly which was held in January 1990, the Government  

issued a notification on March 6, 1990 by which the earlier  

notification was superseded and the appointment of the said  

respondent as Chairman was extended from July 25, 1989  

to March 6, 1990.  Another notification was issued on the  

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same date directing that one R.S. Chauhan shall function as  

the Chairman of the Board.  The first respondent preferred a  

writ  petition  assailing  the  validity  of  the  notification  by  

which his period was curtailed and prayed for certiorari to  

quash the same.   When the writ  petition was pending,  a  

notification was issued terminating the appointment of the  

writ petitioner.  The High Court had passed a direction that  

no appointment to the post of Chairman could be made till  

further orders of the Court.  That order was passed on 30 th  

March, 1990.  At the time of conclusion of the hearing, the  

learned Advocate General after obtaining instructions filed  

an  undertaking  to  the  effect  that  the  notification  dated  

March 6, 1990 curtailing the period of the writ  petitioner  

would be withdrawn.  Accepting the undertaking, the writ  

petition  was  disposed  of.   On  June  11,  1990,  the  

Government withdrew both the notifications, i.e., March 6,  

1990 and March 30,  1990.   On June  11,  1990,  a  show  

cause  notice  was  issued  to  Kailash  Chand  Mahajan  and  

eventually he was suspended and R.S. Chauhan, a Member  

of the Board was allowed to function as the Chairman.  The  

issuance  of  the  show  cause  notice  and  the  order  of  

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suspension  were  challenged  in  a  writ  petition.   Various  

arguments  were  advanced  from both  sides  and  the  High  

Court  eventually  quashed  the  notifications  issued  by  the  

State.  Be it noted, a contention was raised before the High  

Court  that  R.S.  Chauhan  having  been  appointed  as  the  

Chairman,  he  ought  to  have  been  impleaded  as  a  party  

which was rejected by the High Court.  This Court, dwelling  

upon various facets, posed the question whether the failure  

to implead R.S. Chauhan would be fatal to the writ petition.  

Addressing  the  said  issue,  as  stated  earlier,  this  Court  

distinguished the decision of Miss Rafia Rahim (supra) and  

Padamraj (supra) and thereafter proceeded to state thus:-

“104. On the contrary, we think we should ap- proach the matter from this point of view, viz., to  render an effective decision whether the presence  of Chauhan is necessary? We will in this connec- tion refer to A. Janardhana   v.   Union of India   it is  held as under:  

“Approaching the matter from this angle,  it may be noticed that relief is sought only  against the Union of India and the Min- istry concerned and not against any indi- vidual  nor  any  seniority  is  claimed  by  anyone individual against another partic- ular  individual  and,  therefore,  even  if  technically the direct recruits were before  

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the court, the petition is not likely to fail  on that ground.”

105. What  was the  first  respondent  seeking in  the writ petition? He was questioning the validity  of  the  Ordinance  and the  Act  whereby  he  had  been deprived of his further continuance. What is  the  relief  could  he  have  asked  for  against  Chauhan?   None.  The  first  point  is  Chauhan  came to be appointed consequent to the suspen- sion  of  the  first  respondent  which  suspension  had come to be stayed by the High Court on June  12, 1990. Then, again, as pointed out by the High  Court  it  was “till  further  orders”.  Therefore,  we  hold the failure to implead Chauhan does not af- fect the maintainability of the writ petition.”

[Emphasis added]

The said decision, we are inclined to think is a binding  

precedent for the purpose of understanding the concept of  

necessary party.  The Court has relied on the pronounce-

ment in A. Janardhana (supra). What has been really laid  

down  is  that  R.S.  Chauhan  was  not  entitled  in  law  to  

contest the lis as Kailash Chand, the aggrieved party, was  

challenging the ordinance as he had faced the curtailment  

of period of his tenure.  

44. In this context, we may refer to certain other authori-

ties where there has been an expansion of the concept of  

necessary  party.   The  Constitution  Bench  in  U.P.  Awas  

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Evam Vikas Parishad  vs.  Gyan Devi (Dead) by LRs. &  

Ors.40 has laid down that in a land acquisition proceeding,  

the local authority is a necessary party in the proceedings  

before the Reference Court and is entitled to be impleaded  

as a party in those proceedings wherein it can defend the  

determination of the amount of compensation by the Collec-

tor and oppose enhancement of the said amount and also  

adduce evidence in that regard.  That apart, it has also been  

stated that in the event of enhancement of the amount of  

compensation by  the  Reference  Court,  if  the  Government  

does not file an appeal, the local authority can file an appeal  

against the award in the High Court after obtaining leave of  

the Court.  That apart, the Court also opined that in an ap-

peal by the person having an interest in the land seeking  

enhancement of  the amount of  compensation awarded by  

the  Reference  Court,  the  local  authorities  should  be  im-

pleaded as a party and is entitled to be served notice of the  

said  appeal  and  that  could  apply  to  appeal  in  the  High  

Court as well as in the Supreme Court.

40 (1995) 2 SCC 326

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45. In  Delhi  Development  Authority  vs.  Bhola  Nath  

Sharma  (Dead)  by  LRs  and  Ors.41,  the  question  arose  

whether  the  Delhi  Development  Authority,  at  whose  in-

stance  land  of  the  respondent  and  others  had  been  ac-

quired, could be treated as a ‘person interested’ within the  

meaning of Section 3(b) of the Land Acquisition Act, 1894  

and it was entitled to an opportunity to participate in the  

proceedings held before the Land Acquisition Collector and  

the Reference Court for determining the compensation.  The  

two-Judge  Bench  referred  to  U.P.  Awas  Evam  Vikas  

Parishat (supra) and relied upon a passage from  SLP (C)  

No.1608 of 199942 and eventually allowed the appeal and  

set aside the impugned judgment of the High Court as well  

as that of the Reference Court and remitted the matter to  

the Reference Court to decide the reference afresh after giv-

ing opportunity of hearing to the parties which shall neces-

sarily include opportunity to adduce evidence for the pur-

pose of determining the amount of compensation.

46. We have referred to the aforesaid decisions with the  

purpose that the company or the authority has been treated  41 (2011) 2 SCC 54 42 Decided on 12.04.1999

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as a necessary party on the foundation that it meets the cri-

terion provided in the definition clause and that apart ulti-

mately it has to pay the compensation.  Therefore, it has a  

right in law to participate in the proceedings pertaining to  

determination  of  the  amount  of  compensation.  Factual  

score, needless to say, stands on a different footing.

47. Few examples can be given so that the position can be  

easily appreciated.  There are provisions in some legislations  

pertaining to Gram Panchayat or Panchayat Samiti where  

on certain grounds the competent authority has been con-

ferred  the  power  to  remove  the  elected  Sarpanch  or  the  

Chairman, as the case may be on certain counts.  Against  

the order of the Collector, an appeal lies and eventually ei-

ther a revision or a writ lies to the High Court.  After his re-

moval,  someone by way of indirect election from amongst  

the members of the Panchayats or the Panchayat Samiti is  

elected as  the  Sarpanch or  the  Chairman.   The removed  

Sarpanch assails his order of removal as he is aggrieved by  

the manner, method and the reasons for removal.  In his  

eventual success, he has to hold the post of the Sarpanch, if  

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the tenure is there.  The question, thus, arises whether the  

person who has been elected in the meantime from amongst  

the members of the Panchayat Samiti or Sabha is a neces-

sary party.  The answer has to be a categorical ‘no’, for he  

cannot oppose the order of removal assailed by the affected  

Sarpanch nor can he defend his election because he has  

come into being because of a vacancy, arising due different  

situation.

48. In the instant case, shop no.2 had become vacant.  The  

appellant was allotted the shop, may be in the handicapped  

quota but such allotment is the resultant factor of the said  

shop falling vacant.  The original allottee, that is the respon-

dent, assailed his cancellation and ultimately succeeded in  

appeal.  We are not concerned with the fact that the appel-

lant herein was allowed to put her stand in the appeal.  She  

was neither a necessary nor a proper party.  The appellate  

authority  permitted  her  to  participate  but  that  neither  

changes the situation nor does it confer any legal status on  

her.  She would have continued to hold the shop had the  

original allottee lost the appeal.  She cannot assail the said  

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order in a writ petition because she is not a necessary party.  

It  is  the  State  or  its  functionaries,  who could have  chal-

lenged the same in appeal.  They have maintained sphinx  

like silence in that regard.  Be that as it may, that would not  

confer any locus on the subsequent allottee to challenge the  

order passed in favour of the former allottee.  She is a third  

party to the lis in this context.  The decisions which we have  

referred to  hereinbefore  directly  pertain to  the  concept  of  

necessary  party.   The  case  of  Kailash  Chand  Mahajan  

(supra) makes it absolutely clear.  We have explained the  

authority in  J.S. Yadav’s case (supra) and opined that it  

has to rest on its own facts keeping in view the declaratory  

relief  made  therein,  and  further  what  has  been  stated  

therein cannot be regarded as a binding precedent for the  

proposition that in a case of removal or dismissal or termi-

nation, a subsequently appointed employee is a necessary  

party.  The said principle shall apply on all fours to a fair  

price shop owner whose licence is cancelled.  We may has-

ten to add, this concept will stand in contradistinction to a  

case where the land after having vested under any statute in  

the State have been distributed and possession handed over  

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to different landless persons.  It is because of such allot-

ment and delivery of possession in their favour, that is re-

quired under the statute rights are created in favour of such  

allottees and, therefore, they are necessary parties as has  

been held in Ram Swarup & Ors. vs. S.N. Maira & Ors.43  

The subtle distinction has to be understood.  It does not re-

late to a post or position which one holds in a fortuitous cir-

cumstance.  It has nothing to do with a vacancy.  The land  

of which possession is given and the landless persons who  

have received the Pattas and have remained in possession,  

they have a right to retain their possession. It will be an an-

archical  situation,  if  they  are  not  impleaded  as  parties,  

whereas in a case which relates to a post or position or a va-

cancy, if he or she who holds the post because of the va-

cancy having arisen is allowed to be treated as a necessary  

party or allowed to assail the order, whereby the earlier post  

holder or allottee succeeds, it will only usher in the reverse  

situation – an anarchy in law.   

49. In this context, reference to the judgment in  Ramesh  

Hirachand  Kundanmal vs.  Municipal  Corporation  of  

43 (1999) 1 SCC 738

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Greater  Bombay  &  Ors.44 would  be  fruitful.   The  two-

Judge Bench was dealing with the concept of  duminus litis  

which relates to the plaintiff.  The Court analysed the provi-

sion contained in Order I  Rule 10 and various sub-rules.  

The subject matter in the case pertained to a dispute be-

tween the petitioner  and the respondent no.1 which cen-

tered on the demolition and unauthorized construction by  

the competent authority under the Bombay Municipal Act.  

The respondent no.2 was the lessee in possession of the ser-

vice station.  The Municipal Corporation had not issued any  

notice to the said respondent.  It was contended before the  

Court that the respondent no.2 was instrumental in the ini-

tiation  of  the  proceeding  by  the  Municipal  Corporation  

against him.  The court addressed to the issue whether the  

said respondent is a necessary or proper party.  In the said  

case, the appellant had instituted a case against the third  

respondent for declaration that she was the lawfully married  

wife of the third respondent who had entered context and  

admitted the claim.   An application for  impleadment  was  

sought by the respondent nos.1 and 2 on the ground that  

44 (1992) 2 SCC 524

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they were respectively the wife and son of the third respon-

dent and they were interested in denying the appellant’s sta-

tus as wife and the children as the legitimate children of the  

third respondent.  The trial court had allowed the applica-

tion and the said order was confirmed by the High Court in  

its revisional jurisdiction.  This Court referred to the author-

ity in Razia Begum vs.  Anwar Begum45 and came to hold  

that there is a clear distinction between the suits relating to  

property and those suits in which the subject matter of liti-

gation is a declaration as regards status or legal character.  

The Court observed that in the former category, the rule of  

personal interest is distinguished from the commercial in-

terest which is required to be shown before a person may be  

added as a party and accordingly held :-

“The  only  reason  which  makes  it  necessary  to  make a person a party to an action is so that he  should be bound by the result of the action and  the question to be settled, therefore, must be a  question in the action which cannot be effectually  and completely settled unless he is a party. The  line has been drawn on a wider construction of  the rule between the direct interest or the legal  interest and commercial interest. It is, therefore,  necessary  that  the  person  must  be  directly  or  legally interested in the action in the answer, i.e.,  

45 AIR 1958 SC 886

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he can say that the litigation may lead to a result  which will affect him legally that is by curtailing  his legal rights.”

And again:-

“It is difficult to say that the rule contemplates  joining as a defendant a person whose only object  is to prosecute his own cause of action. Similar  provision  was  considered  in  Amon v.  Raphael  Tuck & Sons Ltd.46, wherein after quoting the ob- servations of  Wynn-Parry,  J.  in  Dollfus  Mieg  et   Compagnie S.A. v.  Bank of England47, that their  true test lies not so much in an analysis of what  are the constituents of the applicants’ rights, but  rather in what would be the result on the subject  matter of the action if those rights could be es- tablished, Devlin, J. has stated:

“The test is ‘May the order for which the  plaintiff is asking directly affect the inter- vener  in  the  enjoyment  of  his  legal  rights’.”

Eventually,  the Court  unsettled the order  passed by  

the trial court as well as by the High Court.

50. We have  referred to  the  said  decision in extenso as  

there is emphasis on curtailment of legal right.  The ques- 46  (1954) 1 All ER 273 47  (1950) 2 All ER 605, 611

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tion to be posed is whether there is curtailment or extinc-

tion of a legal right of the appellant. The writ petitioner be-

fore the High Court was trying to establish her right in an  

independent manner, that is, she has an independent legal  

right.  It is extremely difficult to hold that she has an inde-

pendent legal right.  It was the first allottee who could have  

continued in law, if his licence would not have been can-

celled.  He was entitled in law to prosecute his cause of ac-

tion and restore his legal right.  Restoration of the legal right  

is pivotal and the prime mover.  The eclipse being over, he  

has to come back to the same position.  His right gets re-

vived and that revival of the right cannot be dented by the  

third party.

51. In view of the aforesaid premises, we do not perceive  

any merit in this appeal and, accordingly, the same stands  

dismissed.  There shall be no order as to costs.  

.............................J. [Dipak Misra]

..........................., J.     [R. Banumathi]

New Delhi October 29, 2015

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