Ratio Decidendi and Obiter Dicta under Interpretation of Statute

The judgement contains the following four parts –

When we talk about the third part, it is divided into two parts, in other words judgements has two parts :

1. Ratio Decidendi
2. Obitur Dicta

1. Ratio Decidendi: Ratio Decidendi  is a latin maxim means “ the reason for deciding”

Ratio decidendi is a legal phrase that translates from Latin to mean “the reason,” or the motivation behind a legal decision. Ratio includes all the principles a court relies on – be they moral, political, or social – to justify their reasoning for coming to a decision in a case.

Ratio Decidendi is nothing but it’s part of judgement in which Judge gives reason for his judgement.

Rules of Ratio Decidendi:

• The ratios should be conclusive and not just a mere attempt of scrutinizing the fact.
• The core element of the dispute should be analyzed and resolved through such reasons.
• The reasons should be relevant to the arisen issue.
• The rations should come out of a dispute in law not from the dispute in facts.
• As already mentioned, all the reasons expressed in a precedent are binding.
• In a case, when the judges agree to the decision but have different reasons for the same. Then, the core area of acceptance shall be focused on.

The doctrine of ratio decidendi can be better understood by a concrete illustration. There are some English cases which are :

Bridges v. Hawkeshworth In this case a customer found some money on the floor of a shop.

The Court applied the rule of “finders-keepers” and awarded possession of the money to him rather than to the shop-keeper. The ratio decidendi of this case is that finder of goods is the keeper, i.e., has right of possession over it.

In another case of South Staffordshire Water Company v. Sharman,  where the defendant found two gold rings in a mud of pool owned and occupied by the plaintiffs, the court refused to apply the “finders-keepers” rule expressed in Bridges’ case on the ground that in that case money was found in a public place, i.e., on the shop floor but in the instant case, it was found in a pool which was not open to public.

Hence ratio decidendi is a principle of law which forms the basis of decision in a particular case.

• Obiter Dicta: Pronouncements of law, which are not part of the ratio decidendi are called as obiter dicta and they are not authoritative or binding on subordinate Courts. Obiter dicta may be defined as mere casual expressions by the Court which carry no weight.

In the course of judgment, a Judge may make various observations which are not precisely relevant to the issues before him. For instance, he may illustrate his reasoning by reference to hypothetical situations. Whatever said by the Court by the way of statements of law which lay down a rule but which is unnecessary for the purpose in hand, are called obiter dicta. These dicta have the force of persuasive authority and are not binding upon the courts. The courts may seek help from them but they are not bound to follow them.

Obiter dicta literally means something said by the Judge by the way, which does not have any binding authority. Goodhart defines obiter dictum as

“a conclusion based on a fact the existence of which has not been determined by the court”

This it is a mere causal statement of observation which is not pertinent, relevant or essential to decide the issue in hand.

It does not have any binding authority.

Binding and Persuasive Value :

Obiter dicta of their lordship of the Hon’ble Supreme Court is entitled to highest respect and is binding on all courts of the country in the absence of any direct pronouncements.

The dicta are not binding on the Supreme Court itself but have the persuasive value.

Case Laws:

In Nirbhaya case in which death penalty of gang rap accuseds was imposed by the Hon’ble Supreme Court, Hon’ble Supreme Court at para 149 of page 428 In the words of Swami Vivekananda the best thermometer to the progress of a nation is its treatment of its woman.

What is binding under Article 141

Art. 141 state that only the ratio decidendi of a case is binding not the obiter dicta.

Bengal Immunity Company Limited v. State of Bihar. (1955):

The SC has correctly pointed out that the words of Article 141-“binding on all courts in India”, does not to include the Supreme Court. The SC is not bound by its own judgments but is free to reconsider them in appropriate cases as and when required.

Although there is no express provision, but by convention the decisions of a High Court are binding on all lower courts within the territorial jurisdiction of that HC. Similarly, a decision of a higher Bench, is binding on the lower Bench.

Advantage of the Doctrine :

• It is time savings and avoid unnecessary litigations.
•  It brought greater certainty and consistency in the law.
•  It eliminates the element of ambiguity and enables the lower courts to follow the decision of the higher court with question.
• The element of predictability is one of the primary needs in the efficient functioning of a judicial system. The doctrine of Stare Decisis thus ensures that the judgements given by the courts are predictable thereby boosting the confidence of the people in the judicial system.

Disadvantage of the Doctrine :-

• It is being criticized because of its effect of limiting the free development of law.
• Foremost disadvantage of this doctrine and the precedent system is its rigidity and unwillingness to allow change.
• Another disadvantage is its complexity which sometimes makes the situation more uncertain.
• Many time judicial decisions deemed as mistakes are being continued in the form of precedent law.
• The doctrine of Stare Decisis is also considered as a doctrine that is against the principles of democracy since it allows unelected judges to make law through their judgements.

Non-binding nature under Article 141 of the Indian Constitution

• The decisions that are not expressed properly. In the case of State v. Synthetics and Chemicals Ltd. and Anr. (1991), it was stated that a decision that lacks expression and rational grounds and further where it did not proceed on consideration of the legal issue, such decision shall not have a binding effect as per Article 141 of the Constitution of India.
• The decisions that are not founded on appropriate grounds.
• The decisions that did not proceed based on consideration of the legal issue. In the case of Dr. Shah Faesal and Others v. Union Of India and Another (2020), it was observed by the Supreme Court that only the principle laid down in a judgement shall be considered as binding law under Article 141 of the Constitution.
• As per the doctrine of Stare Decisis, the Obiter dicta of a case is not binding, thus it cannot be considered solely as a reason to declare any statutory rule invalid. It only has a persuasive value.
• The decision rendered per incuriam is not binding in nature. This means any decision made on per incuriam, must not be used as a precedent.
• In the case wherein the decision is rendered sub-silentio, even then such decision is not used as a precedent. Sub-silentio means when a question of law was not correctly and reasonably determined.
• The scenario wherein the Court’s observations regarding the facts of the cases are not binding.

Types of judicial precedents

• Declaratory precedent – A declaratory precedent refers to such a precedent wherein an already existing rule is applied in deciding a question of law. 
• Original precedent – In the case of an original precedent, a new law is established to apply it in a legal issue. It can be said that the original precedents are primarily the reason for the making of new laws. 
• Persuasive Precedent –  A persuasive precedent is a kind of precedent wherein there is no compulsion for the judge to abide by a certain precedent regarding a legal issue, however, such a judge has the responsibility to consider the precedent before taking any action.  
• Absolutely Authoritative Precedents – In the case of an absolutely authoritative precedent, it is a mandate for the judges to follow a particular precedent in deciding a legal matter. Moreover, the judge must abide by the precedent even if they have a dissenting opinion regarding such precedent. 
• Conditionally Authoritative Precedents – When it comes to the case of conditionally authoritative precedents, the concerned judge has to follow the authoritative precedent as it is, but in certain special cases. A judge may disregard the decision of a court if it fails to be rational and lawful. 

Precedents and treatment by Higher Courts

For a case that has been earlier decided by a lower court, a higher court can do the following–

• Reversal of decision –  By order of a higher court, the judgement of the lower courts shall cease to have any effect on the parties or the public.
• Refusal to follow a decision – A High Court has the power to refuse to follow the decision of a lower court in cases where the High Court cannot reverse or overrule the lower court’s decision.
• Distinguish from the decision – Where a High Court finds that the material facts of the case differ and the principles decided in the precedence is extremely narrow to be adequately applied to the facts of the case before it, then the High Court may distinguish such case from the previously given decision by the lower court.
• Overrule of decision – In a situation where a High Court decides that the decision taken by the lower court regarding a particular is wrong, then it overrules such decision of the lower court.