Case Note & Summary
The appeal arose from the withdrawal of a No Objection Certificate (NOC) issued to the appellant Trust for establishing an Ayurvedic Medical College and Hospital in Himachal Pradesh. The appellant Trust, formed in 2012, proposed to set up the college and hospital during an investment meet in 2014. After site inspection and submission of project report, the Principal Secretary (Ayurveda) issued an NOC on 20.02.2017. The appellant obtained affiliation from Himachal Pradesh University on 02.03.2017 and a loan sanction on 03.03.2017. However, on 14.03.2017, the NOC was withdrawn. The appellant challenged the withdrawal before the High Court, which dismissed the writ petition. The Supreme Court considered whether the withdrawal was proper. The State contended that the NOC was issued without following the Rules of Business, which required the matter to be placed before the Council of Ministers. The Chief Minister had placed the matter before the Cabinet, but the Minister for Ayurveda unilaterally withdrew it and directed issuance of NOC. The High Court examined Rules 14 and 16 of the Rules of Business and found that item no. 17 of the Schedule (important change of policy) required Cabinet approval. The Supreme Court agreed that the NOC was invalid as it was issued without Cabinet concurrence. The Court held that no indefeasible right arises from an illegal grant, and promissory estoppel does not apply when officers act ultra vires. The plea of natural justice was rejected as a useless formality since the Department could not override the Cabinet's decision. The appeal was dismissed.
Headnote
A) Administrative Law - Withdrawal of NOC - Rules of Business - NOC issued by Department without placing matter before Council of Ministers as required under Rules 14 and 16 of the Rules of Business of the Government is invalid - The Chief Minister had placed the matter before the Cabinet, but the Minister unilaterally withdrew it and directed issuance of NOC - Held that such NOC is void ab initio and can be withdrawn (Paras 8-9). B) Promissory Estoppel - Ultra Vires Acts - Doctrine of promissory estoppel not applicable when officers act outside scope of authority - Reliance on M/s Jit Ram Shiv Kumar v. State of Haryana - Held that government cannot be bound by unauthorised actions of its officers (Para 10). C) Natural Justice - Useless Formality - Even if hearing was given, Department could not override decision of Council of Ministers - Held that opportunity of hearing would have been a useless formality (Para 12). D) Indefeasible Right - Invalid Grant - No indefeasible right can be claimed on basis of illegal grant - Held that appellant cannot claim any right on NOC issued without authority (Para 10).
Issue of Consideration
Whether the withdrawal of a No Objection Certificate (NOC) to commence an Ayurvedic Medical College and Hospital was proper.
Final Decision
The Supreme Court dismissed the appeal, upholding the High Court's judgment that the withdrawal of NOC was proper.
Law Points
- Withdrawal of NOC
- Rules of Business
- Promissory Estoppel
- Natural Justice
- Ultra Vires
- Indefeasible Right
