A provision in a statute which is procedural in nature although employs the word shall may not be held to be mandatory if thereby no prejudice is caused. (See Raza Buland Sugar Co. Ltd. vs. Municipal Board, Rampur, State Bank of Patiala vs. S.K. Sharma, Venkataswamappa vs. Special Dy. Commr. (Revenue) and Rai Vimal Krishna vs. State of Bihar.)”
In Ashok Lanka and Another vs. Rishi Dixit and Others (2005) 5 SCC 598, it was held :
“53. The question as to whether a statute is mandatory or directory would depend upon the statutory scheme. It is now well known that use of the expression shall or may by itself is not decisive. The court while construing a statute must consider all relevant factors including the purpose and object the statute seeks to achieve. (See P.T. Rajan vs. T.P.M. Sahir and U.P. SEB vs. Shiv Mohan Singh.)”, Para 54
There cannot also be any doubt that ordinarily consequences flowing from contravention of an imperative character of a statute has to be given effect to. A statutory provision may be substantive or procedural. If it is substantive, the requirements laid down in the statute should ordinarily be complied with. However, when the provisions contain a procedural matter, substantial compliance thereof would serve the purpose.
Application of a statute or principle of law, however, may vary from case to case.
Only because the statute is imperative, it may not necessarily lead to a declaration that the order impugned is a nullity.
In State Bank of Patiala and Others vs. S.K. Sharma (1996) 3 SCC 364, Apex Court has, inter alia, laid down the law in the following terms:
“33. We may summarise the principles emerging from the above discussion. (These are by no means intended to be exhaustive and are evolved keeping in view the context of disciplinary enquiries and orders of punishment imposed by an employer upon the employee):
… … …
(4)(a) In the case of a procedural provision which is not of a mandatory character, the complaint of violation has to be examined from the standpoint of substantial compliance. Be that as it may, the order passed in violation of such a provision can be set aside only where such violation has occasioned prejudice to the delinquent employee.
(b) In the case of violation of a procedural provision, which is of a mandatory character, it has to be ascertained whether the provision is conceived in the interest of the person proceeded against or in public interest. If it is found to be the former, then it must be seen whether the delinquent officer has waived the said requirement, either expressly or by his conduct. If he is found to have waived it, then the order of punishment cannot be set aside on the ground of the said violation. If, on the other hand, it is found that the delinquent officer/employee has not waived it or that the provision could not be waived by him, then the Court or Tribunal should make appropriate directions (include the setting aside of the order of punishment, keeping in mind the approach adopted by the Constitution Bench in B. Karunakar. The ultimate test is always the same, viz., test of prejudice or the test of fair hearing, as it may be called.”
Refer: Management, Pandiyan Roadways Corp. Ltd. Versus N. Balakrishnan- AIR 2007 SCW 3595 : (2007) 7 SCALE 758 : (2007) 9 SCC 755