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A Division Bench of the Gujarat High Court has upheld the power of the state government to permanently debar Notaries. In doing so, it has partly set aside an order of a Single Judge, who had held that Rule 13(12)(b) of the Notaries Rules, 1956 – which grants the government the power to permanently debar a notary – was ultra vires the parent Act.
The facts of the case are that the respondent enrolled with the Bar Council of Gujarat in December 1984. He came to be appointed as a Notary Public by the Gujarat government and received a certificate to practice in July 2002.
In March 2014, a complaint lodged against the respondent, wherein it was alleged that he notarized a fraudulent power of attorney in January 2008. As per the scheme of the Act, an inquiry was conducted into the allegations. In November 2014, the inquiry officer concluded that the respondent had committed a serious misconduct under Section 10(d) of the Notaries Act. This warranted a penalty under Rule 13(12) of the Notaries Rules.
The following month, the state government passed an order permanently debarring the respondent under Rule 13(12)(b)(i).
The respondent then challenged this order before the Gujarat High Court. After hearing the matter, a Single Judge Bench in February 2016 set aside the government order. The Single Judge also held that Rule 13(12)(b)(i) is invalid as the same travels beyond the scope of Section 10 of the Act, which does not empower the state government to permanently debar a Notary from practice.
The Single Judge Bench came to its conclusion based on two grounds – firstly that penalty of permanent debarment is impermissible in law, and secondly, that the order of debarment stood vitiated for want of notice to the respondent.
Aggrieved by the order, the State of Gujarat filed the present appeal before the High Court.
Kamal Trivedi, Senior Advocate and Advocate General, appearing for the State of Gujarat, vehemently submitted that the Single Judge had committed a serious error in holding that Rule 13(12)(b)(i) is invalid as the same travels beyond the scope of Section 10 of the Act.
Before arriving at its decision, the Division Bench of Justices JB Pardiwala and VB Mayani delved into the relevant provisions of law.
Section 10 of the Act deals with the power of the government to remove names of notaries from Register on grounds of insolvency, conviction and misconduct, among others.
Rule 13(12) (b) provides:
“…(b) If after considering the report of the competent authority, the appropriate Government is of the opinion that action should be taken against the notary the appropriate Government may make an order
Further, Section 15(2)(g) specifies the power to the Central Government to frame rules in respect of “the manner in which inquiries into the allegations of professional or other misconduct of Notaries may be made”.
After going through the case law on the topic, the Division Bench held that it could not subscribe to the view taken by the Allahabad High Court in Kashi Prasad Saksena, which, like the Single Judge Bench, had held that Rule 13(12)(b) was ultra vires the Act. It thus held,
“…Once the certificate of practice is cancelled, the name of the Notary from the register will have to be deleted or removed. However, that does not mean that the State Government is not empowered or competent to pass an order of perpetually debarring the Notary from practice or suspend him from practice for a specified period…we state that Section 10 is not the repository of the power to impose appropriate penalty or punishment…
…We hold that Rule 13(12)(b) of the Rules is valid and in a given case, more particularly, having regard to the nature of the professional misconduct or any other misconduct, it is open for the State Government to perpetually debar the Notary from practice.”
The Division Bench, however, partly agreed with the Single Judge as regards the aspect of granting a Notary an opportunity of being heard before any final decision is taken.
“We are of the view that the Notary Public may not be entitled to be heard for the second time with regard to penalty or punishment, but at least the State Government needs to give an opportunity of hearing with regard to the findings recorded by the Inquiry Officer in his inquiry report.”
Thus, the Court directed the state government to give an opportunity of hearing to the respondent as regards the legality and validity of the inquiry as well as the findings recorded by the Inquiry Officer. This exercise is to be completed within fifteen days.
Advocates Rakesh Patel and Vinay Vishen appeared along with AG Trivedi for the state. The respondent Notary was represented by Senior Advocate Mehul Shah and Advocate Jay Thakkar. Advocate Vishwas Shah appeared for the second respondent.
Read the judgment: