Principles of Natural Justice VIII / The Revival of Ray XCI

RBI has been issuing ‘Master Directions’ on diverse issues since 2016.

Every proceeding which involves civil consequences or adversely affects a citizen should be in accordance with Principles of Natural Justice. Erusian Equipment & Chemicals Ltd. v. State of West Bengal, (1975) 1 SCC 70 held, since blacklisting affects privileges of a blacklisted person, fundamentals of fair play require, such a person be provided an opportunity of being heard. Mangilal v. State of Madhya Pradesh, (2004) 2 SCC 447 held, statutory silence should be taken to imply need to observe Principles of Natural Justice. Cantonment Board v. Taramani Devi, 1992 Supp (2) SCC 501 held, audi alteram partem is a part of Article 14.  

‘Master Directions on Frauds’ entails significant civil consequences and do not expressly provide an opportunity of being heard. Thus, audi alteram partem must then be read into ‘Master Directions on Frauds’ to save them from vice of arbitrariness.

Hon’ble Chief Justice of India, Hon’ble Justice Dr. D.Y. Chandrachud, State Bank of India v. Rajesh Agarwal, [Civil Appeal No. 7300 of 2022].