Supreme Court: The 3-judge bench of RF Nariman, Navin Sinha and KM Joseph has reiterated the principles of natural justice as follows:
(1) Natural justice is a flexible tool in the hands of the judiciary to reach out in fit cases to remedy injustice. The breach of the audi alteram partem rule cannot by itself, without more, lead to the conclusion that prejudice is thereby caused.
(2) Where procedural and/or substantive provisions of law embody the principles of natural justice, their infraction per se does not lead to invalidity of the orders passed. Here again, prejudice must be caused to the litigant, except in the case of a mandatory provision of law which is conceived not only in individual interest, but also in public interest.
(3) No prejudice is caused to the person complaining of the breach of natural justice where such person does not dispute the case against him or it. This can happen by reason of estoppel, acquiescence, waiver and by way of non-challenge or non-denial or admission of facts, in cases in which the Court finds on facts that no real prejudice can therefore be said to have been caused to the person complaining of the breach of natural justice.
(4) In cases where facts can be stated to be admitted or indisputable, and only one conclusion is possible, the Court does not pass futile orders of setting aside or remand when there is, in fact, no prejudice caused. This conclusion must be drawn by the Court on an appraisal of the facts of a case, and not by the authority who denies natural justice to a person.
(5) The “prejudice” exception must be more than a mere apprehension or even a reasonable suspicion of a litigant. It should exist as a matter of fact, or be based upon a definite inference of likelihood of prejudice flowing from the non-observance of natural justice
The court was hearing the challenging the cancellation of tender on the ground that it was “impractical” to go ahead with such tender. It was argued that such cancellation was illegal and arbitrary and against the principles of natural justice.
Applying the aforementioned principles to the facts of the case, the Court came to the conclusion that the respondent has been kept completely in the dark so far as the cancellation of the award of tender in his favour is concerned, the audi alteram partem rule having been breached in its entirety. Prejudice has indeed been caused to his client from the fact that one year of the contract period has been taken away.
[State of UP v. Sudhir Kumar Singh, 2020 SCC OnLine SC 847, decided on 16.10.2020]
