Karnataka HC: Natural Justice Does Not Require Adjudicating Authority to Answer Each and Every Submission

Aadrikaa Legal Services (ALS)- Law I Litigation I Arbitration

Date: 01.10.2026

Karnataka HC: Natural Justice Does Not Require Adjudicating Authority to Answer Each and Every Submission

The Karnataka High Court has dismissed two writ petitions filed by JSW Steel Limited challenging the refusal of the PMLA Appellate Tribunal to remand attachment proceedings to the Adjudicating Authority merely because JSW alleged that its written submissions and synopsis had not been specifically considered.

The Division Bench held that principles of natural justice do not invariably require a separate right to file a synopsis or written arguments, nor is a court or statutory authority required to reproduce or expressly answer every submission made by a party.

What natural justice essentially requires, the Court explained, is a real and effective opportunity to know the case and present a defence. An order must demonstrate application of mind to material and substantial contentions bearing upon the decision, but every argument need not be dealt with in elaborate detail.

Origin of the Dispute: Alleged Illegal Iron Ore Mining

• The dispute traces back to an FIR registered by the Central Bureau of Investigation on 1 October 2011 concerning alleged illegal mining and transportation of iron ore.
• The FIR involved, among others, G. Janardhana Reddy, G. Lakshmi Aruna and M/s Associated Mining Company (AMC). A chargesheet was subsequently filed by the CBI on 30 May 2012 for various offences under the IPC and Prevention of Corruption Act.
• The CBI allegations included that although AMC’s mining lease did not support the quantity shown as produced, substantial quantities of iron ore were allegedly illegally extracted from other mining areas and supplied onwards.
• According to the chargesheet allegations recorded in the judgment, the accused were alleged to have illegally extracted and transported substantial quantities of iron ore, with the value of 24 lakh metric tonnes alleged to be around ₹480 crore.

ED Registers PMLA Case

• As the underlying offences were scheduled offences under the Prevention of Money Laundering Act, the Enforcement Directorate registered ECIR/09/BZ/2012 on 25 September 2012.
• The ED treated the alleged ₹480 crore derived from the sale of illegally mined iron ore as “proceeds of crime” within the meaning of Section 2(1)(u) of the PMLA.

How JSW Steel Entered the PMLA Proceedings

• During investigation, the ED obtained details of JSW Steel’s bank accounts.
• The case recorded in the judgment was that JSW had been supplied approximately 1,84,992 metric tonnes of iron ore allegedly illegally extracted by the accused.
• The ED alleged that ₹33,80,87,617 was payable by JSW Steel in respect of iron ore purchased from G. Janardhana Reddy and G. Lakshmi Aruna, partners of AMC, and that this amount continued to constitute “receivables” of AMC’s erstwhile partners.
• On that basis, a Provisional Attachment Order dated 27 March 2015 was issued under Section 5(1) of the PMLA attaching various JSW Steel bank accounts aggregating approximately ₹24.37 crore.
• The judgment further records the ED’s allegation that another amount of approximately ₹9.43 crore remained in JSW Steel’s possession in connection with the alleged proceeds of crime.

Adjudicating Authority Confirms Attachment

• The Adjudicating Authority subsequently confirmed the attachment.
• The High Court records that, by order dated 9 April 2021, the Adjudicating Authority stated that JSW Steel’s reply to the show-cause notice had been considered, counsel for both sides had been heard, and the material placed before it had been examined.
• JSW Steel challenged the confirmation before the PMLA Appellate Tribunal.

JSW Steel Seeks Remand Before Appellate Tribunal

• On 10 December 2024, JSW Steel submitted before the Appellate Tribunal that the matter ought to be sent back to the Adjudicating Authority because its written submissions and synopsis had allegedly not been considered.
• The Tribunal gave the ED an opportunity to obtain instructions and alternatively permitted both parties to argue all issues, including matters which JSW claimed had not been dealt with by the Adjudicating Authority.
• When the appeals were again considered on 30 January 2025, the Tribunal declined to remand the proceedings at that stage. It observed that the issues could not be decided piecemeal and gave JSW liberty to raise all issues based on the pleadings and material already on record.
• The appeals were then listed for further arguments.
• JSW challenged that order before the Karnataka High Court.

JSW Steel: Failure to Consider Written Submissions Violated Natural Justice

• Senior counsel appearing for JSW Steel argued that its right to a fair hearing had not been properly respected by the Adjudicating Authority.
• According to JSW, its synopsis and written submissions had been ignored, and this amounted to a violation of natural justice at the original adjudication stage.
• The company argued that a defect in natural justice at the initial stage could not simply be cured at the appellate stage. It therefore contended that the Appellate Tribunal ought to have remanded the matter to the Adjudicating Authority.
• JSW relied upon the Supreme Court judgment in Institute of Chartered Accountants of India v. L.K. Ratna & Ors., (1986) 4 SCC 537.

ED: Appeals Were Still Pending, Writ Petitions Were Premature

• The Enforcement Directorate opposed the writ petitions as misconceived and not maintainable.
• The ED pointed out that JSW’s statutory appeals were still pending before the Appellate Tribunal and no final appellate order had been passed.
• Moreover, the Tribunal had expressly permitted JSW to argue all issues on facts and law. The ED therefore argued that approaching the High Court at that intermediate stage was premature.
• The ED also relied upon the Supreme Court’s decision in JSW Steel Ltd. v. Enforcement Directorate, 2025 SCC OnLine SC 2150 concerning the same broader proceedings.

Court Rejects JSW’s Natural Justice Argument

• The Karnataka High Court rejected JSW Steel’s principal contention.
• The Bench observed that the Adjudicating Authority’s order indicated that it had considered the material placed before it and heard counsel before confirming the provisional attachment.
• According to the High Court, where counsel have advanced arguments and also filed a synopsis or written submissions, the authority is not required to note “each and everything” contained in those documents.
• The mere absence of a specific reference to a synopsis or written submission does not, by itself, establish that the arguments were ignored.

Natural Justice Does Not Require Every Submission to Be Reproduced

The Court then articulated an important principle concerning procedural fairness.

It held that natural justice does not invariably require:

• a separate right to file a synopsis;
• a separate right to submit written arguments; or
• an express answer by the adjudicating authority to every submission.

Instead, the fundamental requirement is that the affected person should receive a real and effective opportunity to understand the case against it and present its defence in a manner appropriate to the statutory scheme and circumstances.

The Court further noted that such opportunity may ordinarily be oral or written and that even a personal hearing is not automatically an indispensable requirement in every statutory proceeding.

Meaningful Consideration Is Required, Not an Answer to Every Argument

• The High Court nevertheless drew an important distinction.
• While an adjudicating authority does not have to answer every argument in elaborate detail, it must meaningfully consider the submissions made before it.
• The order should disclose that the authority has applied its mind to the material on record and to substantial contentions that have a bearing on the decision.
• The extent of the obligation to give reasons is context-dependent and may be greater where the statute provides an appellate remedy or the nature of the decision demands accountability.
• Thus, the judgment does not dispense with the requirement of a reasoned decision. Rather, it distinguishes between meaningful consideration of material issues and a requirement to mechanically reproduce or separately answer every written argument.

No Breach of Natural Justice Found in JSW’s Case

• Applying those principles, the Court noted that it was not apparent from the order sheet that the Adjudicating Authority had itself invited a separate synopsis or written arguments.
• JSW had received an opportunity to make representations through counsel and had also filed its reply to the show-cause notice.
• Consequently, the Court held that non-mention of the separately filed synopsis did not amount to breach of natural justice.
• The Bench expressly concluded that failure to refer to each and every submission contained in the synopsis and written submissions did not establish denial of natural justice.

No Prejudice Caused as JSW Could Argue Everything Before Tribunal

• Another significant consideration was the absence of prejudice.
• JSW’s appeals remained pending before the Appellate Tribunal, and the Tribunal had expressly permitted the company to make all submissions on facts and law.
• The High Court therefore found that JSW had approached it before final adjudication of its appeals even though the impugned Tribunal order had not caused it prejudice affecting its ability to contest the attachment.
• The Court consequently held that the writ petitions were not maintainable on that ground alone.

Supreme Court Had Already Said Statutory PMLA Process Should Run Its Course

• The High Court also referred to the Supreme Court’s earlier decision in JSW Steel Ltd. v. Enforcement Directorate, 2025 SCC OnLine SC 2150.
• In that decision, the Supreme Court had noted that the PMLA provides a comprehensive statutory mechanism involving provisional attachment under Section 5, confirmation by the Adjudicating Authority under Section 8 and an appellate remedy under Section 26.
• The Supreme Court had observed that constitutional or appellate jurisdiction should ordinarily not be exercised where an efficacious alternative remedy is available and is actively being pursued.
• Significantly, the Supreme Court had identified the central controversy as whether the specific amount of ₹33,80,87,617, representing alleged unpaid consideration for iron ore supplied by AMC, could constitute “proceeds of crime” and whether subsequent withdrawals violated Section 3 of the PMLA.
• It had held that these were matters appropriately left for the statutory process to reach its logical conclusion.

High Court Calls Fresh Writ Proceedings Abuse of Process

• Taking the earlier litigation into account, the Karnataka High Court observed that both the High Court and Supreme Court had already declined to interfere with related proceedings while the statutory mechanism remained available.
• The Bench therefore characterised the filing of the present writ petitions at this stage as a “gross abuse of the process of the Court” and held that they were liable to be dismissed at the threshold.

Appellate Proceedings Are Continuation of Original Proceedings

• The High Court further held that the mere fact that the Appellate Tribunal had declined to remand the case on the alleged natural justice violation did not justify intervention under Articles 226 and 227 or Section 482 Cr.P.C.
• The Tribunal had jurisdiction to determine the appeals on both facts and law, and the appellate proceedings were described as a continuation of the proceedings before the Adjudicating Authority.
• Since JSW had been given liberty to raise all submissions before the Tribunal, the Court found no prejudice and no justification for directing remand at the threshold.

Final Decision: JSW Steel’s Writ Petitions Dismissed

• The Karnataka High Court ultimately dismissed both writ petitions without costs.
• All pending applications were also disposed of.
• The effect is that JSW Steel must pursue its pending statutory appeals before the PMLA Appellate Tribunal, where it remains free to raise its factual and legal arguments.
• Importantly, the High Court did not finally determine whether the disputed ₹33.80 crore constituted “proceeds of crime.” That substantive controversy remains within the statutory adjudicatory process.

Key Legal Principles Emerging From the Judgment

The judgment reinforces several important principles governing natural justice and judicial review in statutory proceedings:

1. Natural justice does not require every written argument or synopsis to be expressly reproduced or separately answered.
2. What is essential is a real and effective opportunity to know the case and present a defence.
3. Authorities must meaningfully consider the material and substantial contentions, but need not answer every argument in elaborate detail.
4. Non-reference to a separately filed synopsis does not automatically establish violation of natural justice.
5. Prejudice remains an important consideration while examining procedural objections.
6. Courts may decline writ intervention where statutory appellate proceedings remain pending and the appellant is free to raise all factual and legal contentions there.
7. A refusal by an Appellate Tribunal to remand a matter at an intermediate stage does not by itself warrant constitutional intervention where the Tribunal can decide the controversy on facts and law.

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Source: Karnataka High Court

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