Courts must pass reasoned orders to enable parties understand why they lost or won cases: SC

New Delhi: The Supreme Court has said that courts need to pass a reasoned order in every case which would enable the parties involved in the litigation to understand as to “why one party has won and other has lost”. 

The top court remanded back to the Madhya Pradesh High Court at Indore, a matter related to provident fund contribution for deciding it afresh.

A bench of justices A M Sapre and Navin Sinha said that the order of the court should highlight the legal principles applicable to the issues involved.

“Time and again, this court has emphasised on the courts the need to pass reasoned order in every case which must contain the narration of the bare facts of the case of the parties to the lis, the issues arising in the case, the submissions urged by the parties, the legal principles applicable to the issues involved and the reasons in support of the findings on all the issues arising in the case and urged by the learned counsel for the parties in support of its conclusion,” the bench said. 

The court said it is really unfortunate that the division bench (of high court) failed to keep in mind these principles while disposing of the writ petition. 

“Such order, in our view, has undoubtedly caused prejudice to the parties because it deprived them to know the reasons as to why one party has won and other has lost,” the bench said. It said that the top court can never countenance the manner in which such order was passed by the high court which has compelled it to remand the matter for deciding the writ petition afresh on merits. 

The bench, after perusing the order of the high court said, “Indeed, in the absence of any application of judicial mind to the factual and legal controversy involved in the appeal and without there being any discussion, appreciation, reasoning and categorical findings on the issues… It is difficult for this court to sustain such order of the division bench.” 

It said that the only expression used by the division bench in disposing of the appeal is “on due consideration” and it is not clear to the court as to what was that due consideration, which persuaded the high court to dispose of the writ petition because in the earlier paragraphs only facts are set out. The court set aside the order of the high court and remanded back the matter to it to decide it afresh on merits and in accordance with law while keeping in mind its observations.

Advocate Dushyant Parashar, appearing for Central Board of Trustees, said that on May 19, 2008, it had issued summons under provisions of Employees Provident Fund and Miscellaneous Provisions Act to M/s Indore Composite Pvt. Ltd. for non -payment of the provident fund contribution in the year 2005 -06 on the wages lesser than the minimum wages prescribed for the employees under the category of semi -skilled.

He said that the company in its response submitted that the department has not considered non- working days of the employees already furnished in Form 3A for year 2005 -06 and there were some unskilled employees but the department has treated all of them as semi-skilled. The board, after considering the reply of the company, directed the company to deposit Rs 87,204 within 15 days from the receipt of that order. 

Further, the board on January 21, 2015, directed the company to pay damages and allied dues of Rs 91,585 for the delayed payments. The order of the board was challenged by the company before the Employees Provident Fund Appellate Tribunal, New Delhi and the tribunal set aside the order of the board.

The board, thereafter, challenged the order before the high court but it dismissed the petition and upheld the order of appellate tribunal. Thereafter, the board challenged the order of high court before the apex court